Lousy 2019 for Junior Market stocks

January 1, 2020 by

Junior Market trades

Junior Market did not end 2019 with glory splashed all over it with the market for small and medium-size companies, gaining just 3.1 percent in 2019, down from 18.8 percent in 2018 and 24.3 percent in 2017.
While the premier stocks rose appreciably in 2019, stocks on the Junior Market faltered in its performance in 2019, with the price of only one stock listed on the market at the end of 2018 doubling in value in 2019 and another coming close, with a rise of 97 percent. The Junior Market that saw a half of its listings declining in the year had just four stocks gaining over 100 percent. Three new listings in the Junior Market occupied the top three positions.  Fontana, pharmacy operators, was the top performer and closed the year at $7.30 with a rise of 288 percent on the expectation that the new store at Waterloo Road that opened in the December quarter, will boost income and profit in the 2020 fiscal year. The second-best performer, the advertising and production company – Limners and Bards, was listed in summer and delivered a 200 percent increase for investors who bought the stock at the IPO stage. The recently listed MailPac Group, with gains of 111 percent from the IPO price of $1 took up the number three position.
Honey Bun fresh from the expansion of its bakery operations and a 20.4 percent growth in revenues in the September quarter and profit after tax rising 67 percent for the full 2019 fiscal year, doubled in price with a 103 percent increase. Elite Diagnostic is the sole Junior Market stock from the 2018 TOP 10 to remain in the TOP 10 in 2019. tTech 6th worse performer in 2018, made it to the 2019 Top 10 in the eight position. Jetcon Corporation, the number 9 worse performer and GWest Corporation at number 10 in 2018 again ended in the worse ten performing stocks in 2019, in fourth for GWest and 10th position for Jetcon.
One major reason for the divergence for the performances of the Main Market and the Junior Market is to be found it the valuation multiple for both markets.
While both markets close 2018, with PE ratios around 16 times 2018 earnings the market moved decidedly in different paths with Main Market stocks approaching PE ratio around 20 leaving the Junior Market at just over 14.

Gains fin the Junior Market peaked at 12.8% on August 14 and drifted down since.

Interest rates, in Jamaica, fell again in 2019, with Treasury bill rates that started the year at just over two percent falling to 1.5 percent by year-end. This single move would have encouraged institutional investors to switch focus from money market instruments to stocks. The stocks they would have gone into would be the more established Main Market stocks rather than Junior Market ones. Added to that factor, is the fact the with increased IPOs into the market many individual investors sold stocks to buy into the new issues, leaving less money available for previously listed stocks.

Filed Under: Breaking News, JSE Junior Market, Stock Market Tagged With: , , , , , , , , , , ,

Big gains for 10 Junior Market stocks in 2018

January 3, 2019 by

While Junior Market stocks on the Jamaica Stock Exchange chalked up gains of just 18.8 percent overall for 2018, but 5 companies’ stock rose between 104 to 282 percent for the year.
SSl Venture Capital, formerly C2W Music raced to a gain of 282 percent to remain in the TOP 10 Junior Market stocks for the second consecutive year. The stock benefitted from new life given it, when Stocks and Securities acquired controlling interest in it, for use as a venture capital vehicle. The next best performing stock delivered gains of 213 percent as investors pushed Derrimon Trading to new heights after the company announced a 10 for one stock split and the acquisition of a subsidiary. CAC2000 captured the number 3 best performing spot, rising by 160 percent for the year, followed by the 2018new  listing, Indies Pharma, with gains of 113 percent, after investors drove the price to a record high of $4.10 to a gain of 173 percent from the IPO price of $1.50. Express Catering gained 104 percent to be one of 3 stocks to reappear in the top 10 for two consecutive years. Caribbean Flavours landed the 6th spot with a gain of 73 percent. Statinery & Office Supplies reappeared in the Top 10 with a rise of 69 percent. ISP Financial chipped in with a rise of 67 percent in 8th spot to be followed by the Montego Bay based, Cargo Handlers that chipped in with 50 percent and the early 2018 listed Elite Diagnostic, was tenth after rising 48 percent.
The worst performing stocks for 2018 included, GWest Corporation down 56 percent due mainly to the much lower revenues than previously forecasted and greater losses. Jetcon Corporation, one of the 2017 Top 10 stocks, came next with a loss of 39 percent as the company reported lower profits for the nine months to September than the prior year. The new 2018 listing, Everything Fresh, ended the first year on the Junior Market as the third worst performing stock with a fall of 39 percent, helped by poor third quarter results as well as coming to the market at an excessive valuation. AMG Packaging ended as the 4th worst performer as the price reflected the losses caused by the toilet tissue operations with a decline in the stock price by 37 percent as it followed tTech with a decline of 33 percent. Eppley that migrated to the main market on the last day of 2018, declined 24 percent to the 6th worse performer, while Lasco Financial lost altitude to close out 2018 as the 7th worse performing the Junior Market stock, with a  loss of 15 percent, just ahead of Knutsford Express at the 8th spot, with a fall of 13 percent, Sweat River fell 9 percent and Consolidated Bakeries ended at the 10th spot with a loss of 6 percent.

 

 

Filed Under: Feature Stories, JSE Junior Market, Stock Market Tagged With: , , , , , , , , , , , , , , , ,

The stock exchange needs radical overhauling

December 16, 2018 by

The Jamaica Stock Exchange is thriving with many investors making good money from their investments in the stocks on the market and companies raising fresh capital as a result of the attractiveness of the capital market. But the growth in the market belies some deep concerns and failures in the system.
The reality is that the capital market is in a state that is far from healthy and those in authority are no moving to fix it. It is difficult to understand why.
An example is that some directors think they can override the Company’s Act and do things that they are not empowered to do. An example is that the directors of GWest Corporation in their wisdom decided that a resolution passed at a general meeting prior to going to the public was only to be partially disclosed to potential shareholders. The stock exchange sees nothing wrong with the lack of disclosure which amounts a variation in the terms of the contract. “So public” was the information, that not even the company’s auditors who reported on the financial statements, months after the public issue, included the information of the resolution that was to give rise to the issue of preference shares, in the audited accounts.
In October, just under 92 million Seprod shares were offered to the public for purchase. Some of the shares were reserved for then existing shareholders of Seprod. Subsequent to the closure of the issue, NCB Capital Markets, the brokers that handled the issue announced that all applications for Reserve Shares in the offer were fully allocated. Several shareholders of Seprod found that they did not get their full allocation and contacted NCB, it was then that they seem to have discovered errors made at the stock exchange.
On November 8, NCB Capital Markets “advises and due to the large number of subscribers for the Offer, the process is taking longer than anticipated.” NCB Capital Markets advised that it is in the process of reconciling the applications and verifying payments received and has requested approval to provide the Basis of Allotment on Monday, November 12, 2018. The broker advised the Stock Exchange on the date promised, that in addition to the full allocation of reserve shares, subscribers from the general public will receive up to the first 5,000 units for which they applied, with the balance greater than 5,000 units allocated approximately 16.56 percent. Subsequent to the allocation

The Jamaica Stock Exchnage subsidiary

announcement, IC Insider.com gathers that investors from the general public who attempted to sell their shares after being allocated, had the Seprod shares in their accounts blocked, so they could not be traded. No one thought it prudent to advise them that the shares were blocked. This publication is seeing an increasing practice where persons in control take unilateral action to alter contractual arrangements. Someone or entity made a big mistake in not computing the allocation correctly in the first place. Information IC Insider.com has, clearly points to the error being made by the Stock Exchange subsidiary. Having done the allocation and credited investors, accounts and refunded excess funds, the Stock Exchange in the view of this publication has no authority to vary a concluded contract. Investors on November 26, were informed that the public got the first 5,000 shares and 16.25 percent of the excess. The letter from the Jamaica Central Securities Depository stated that “ we advise that initially, allocations had been calculated and posted to accounts, however, we detected a glitch in processing that resulted in shares of some clients being incorrectly allocated. Steps were taken to make the necessary adjustments that also included a change in the pro-rated percentage initially published from 15.56 percent to 16.25 percent. When an organization with the prestige of the Jamaica Stock Exchange fowls up matters, one expects that they would handle the matter in a professional manner and absorb the cost, and not opening themselves up to potential law suits.
The Stock Exchange has done the same illegal thing by blocking investors account from trading, as usual the Stock Exchange did not a have the decency to communicate with the investors about that matter. The sad thing is that they wanted the TRN numbers, but the reason they want it is spurious at best. It was just needed to try and clarify that more than one account that seem to belong to one person actually is so. But there is nothing in law that requires them to make such demands and worse the investors have no agreement with the JSE to provide such information as a condition of opening an account. Sadly, the JSE don’t need TRN to sort out limited liability companies, as the Company Office of Jamaica gives each company a unique number that can be used for that purpose. That the Stock Exchange is acting in questionable manner should not be surprising as one or maybe more of their dealer members, have wantonly breached agreements that they have with clients, refusing to comply with the contractual terms.
The Jamaica Stock Exchange release relating to an article IC Insider.com published in connection with the Seprod share allocation states:  “The JSE wishes to advise the public that the article published on ICInsider.com on Friday, November 23, 2018 entitled”, “Seprod stock allocation fowl up to cost JSE” incorrectly stated that the JSE was expected to absorb a loss in respect of the recent allocation of Seprod shares.
“The JSE advises that the JSE Group (The Jamaica Stock Exchange and its subsidiary, the Jamaica Central Securities Depository (JCSD) did not suffer any loss in relation to the foregoing.
“There was a delay in the final allotment of the Shares, but this was not due to any malfunction of our systems. We further advise that the allotment of the Shares was successfully completed, as communicated by the JCSD to the relevant investors.
“We wish to underscore that we continue to work tirelessly to maintain the confidence of participants in the market as we deliver our services to our valued customers,” states JSE.
The Stock Exchange may be “trying to work tirelessly to maintain the confidence of participants in the market,” but there are a plenty that they need to speedily do to convince the public that they are seriously tackling the many issues that require sorting out to enhance its reputation. The problems and inadequacies of the present trading platform is just one of them that has lasted far to long. Then there are errors in the trading report. Currently, delisted securities are still showing up in the reports and Eppley 7.5% preference shares for example that has been recently listed is being reported in the ordinary share section rather than in the preference share section where it belongs.
On November 1, the trading report shows the All Jamaica Composite Index of the main market closing at 396,907.46 but the report for the 2nd of November the Index was said to have closed at 387,739.58 with a rise of 832.12 but that was not possible. On the 5th of November the index was said to fall by 5,472.20 to close at 392,267.38. To date the erroneous information is still on the Stock Exchange website.

The Stock Exchange in its wisdom continues with the circuit breaker that serves no useful purpose. Not only does it have no useful purpose it is making a mockery of the exchange but they seem to have their heads in the sad oblivious as to what is going on around them. Take an example Barita Investments traded at $60 recently but the trade was cancelled as it breached the circuit breaker rules daily limitation, yet it is still being carried as the 52 weeks’ high price. That of course makes no sense, but this is just one of similar errors showing up all over. The stupidity of the circuit breaker is that stocks are frozen for an hour and if a stock breaches the level at a minute after 12 in a day it cannot trade again for the balance of the day. If there is need for it why not have the breaks for 15 or 20 minutes so that trading can take place fairly freely. After all the Stock Exchange still has the power to halt trading in a stock or the market if they consider it prudent to do so. The reality is that the Stock Exchange is not handling what they now have to mange and they want to go into new trading areas that is not really in demand.

Filed Under: Feature Stories, JSE Combined, Stock Market Tagged With: , , , ,

Fontana another IPO another set of errors

December 7, 2018 by

Fontana operators of a series of Pharmacies in Jamaica has now released the Prospectus for their initial public offer but like Elite Diagnostic last year, there are errors in this document that needs correction and explanation.
This is an unfortunate development for yet another issue, that seems very attractively priced. The directors have all signed off on the document that has gone through the Financial Services Commission, the Jamaica Stock Exchange and the Company Office of Jamaica, so why the errors and important ommission.
The introduction in the prospectus speaks to a price of $1.88 except for reserved shares at $1.69 but later on in the body of the document it speaks to a price of $2 for each share, making it unclear exactly what the price really should be? In the interim results to September, there are two issues, one is an error and the other, information that really needs clarification. The interim cash flow has no profit, nor depreciation and it therefore is not balanced and needs correcting.
The gross profit in the interim results jumped sharply,even as revenues grew just 5.5 percent with inventories are up 19 percent at the end of the quarter over 2017 and 15.5 percent over June this year. Why the big jump in inventories with sales are just rising moderately? Importantly, this raises questions about the accuracy of the inventory levels and the gross profit margin for 2018. Management should explain the sharp changes in this area so that investors can better understand why there is such a sharp jump in the quarterly profit.
This publication finds it difficult to once more raising issues relating to a prospectus. We are concerned that enough care is not going into them. The breach of GWest Corporation relating to the non-disclosure of information relating to an extraordinary meeting that was said to approve the issue of preference shares that was never brought to investors’ attention is fresh and has not been properly dealt by the regulators or the company. The regulators seem to have turned a blind eye to it. We need to raise the standards if the capital market integrity is the be enhanced.

Filed Under: Commentary, Initial Public Offers Tagged With: , , , , ,

Please stop Gwest scandalous action

September 21, 2018 by

Gwest booked preference shares but not properly issued.

The Jamaica Stock Exchange and the Financial Securities Commission must move to stop this scandalous action by GWest in issuing new shares that were not authorized by the shareholders of the company and was never mentioned as a contractual agreement in the prospectus that was issued in December last year.
The company cannot go to the public with an offer to sell shares and a critical contract that is now said to have exited, was not properly documented in the prospectus as a material contractual obligation of the company. By the way, the audited financial statement does not show any such contractual agreement.
GWest issued the first quarter results to June with an increase in share capital and the issue of $250 million preference shares without any information being communicated to shareholders. Now they have belated submitted an explanation to the Jamaica Stock Exchange, but those shares have been illegally issued and cannot stand.
The Gwest Corporation release states “on June 15, 2018 pursuant to the resolution passed at an Extraordinary General Meeting of the Company held on the 27th day of November 2017, it has signed an agreement for the conversion of $250,000,000 of shareholders’ loan to 10% Cumulative Non-Redeemable Preference Shares. Of the authorized 1,000,000 10% Cumulative Non-Redeemable Preference Shares, all units were allotted at $250 each to effect the conversion.”
The big question is if such a resolution existed why wasn’t the information included in the prospectus, why wasn’t the authorized capital split to include preference shares, why was the information not included in the audited financial report, why there was no mention of it in the annual report to shareholders.
With the wider shareholding not being made aware of it and not a contracted party to it must approve the increase in share capital with the issue taking place after the public issue of shares have passed for several months.
According to the company’s prospectus, section 7 lists all material contracts, no contract to issue preference shares is listed. Secondly, the reference to the share capital makes no mention of any other shares to be issued other than the ordinary shares of the company.
The prospectus stated the following: material contracts, entered into in the ordinary course of business, have been entered into by the Company with the following persons (“counterparties”) in the 2 years preceding as at the date of this Prospectus:
The above list has no contract in connection with the issue of preference shares to shareholders prior to the IPO.
The audited financial stated about Borrowings – “Shareholders’ loans: The principal balances represent loans from shareholders including US$741,248 (2017: US$742,515) of which US$716,560 was used for the purchasing of the land used for development (see Note 5). There are no set terms of repayment, however management does not anticipate repayment within the next twelve months as the loans are subordinated to the bank loans. No interest was charged on loans during the year as the shareholders agreed to waive such charges. Up to 2017 interest was charged at a rate of 4% and 15% per annum on the US dollar and Jamaican dollar loans, respectively.”
The note in the audited accounts to share capital states: “During the year ended March 31, 2017, interest payable on shareholders’ loans totaling $50 million, were converted to ordinary share capital. The 9,800 ordinary shares at no par value were allocated to the shareholders in the proportions of their shareholdings at that date. (13.2) During the year, the authourised ordinary share capital was increased to 1,000,000 ordinary shares by an ordinary resolution dated November 27, 2017. By an ordinary resolution of the same date each of the 1,000,000 ordinary shares were split into 1,000 ordinary shares such that the authourised ordinary share capital was increased to 1,000,000,000 ordinary shares. Further, by an ordinary resolution dated November 28, 2017 the 10,000 shareholdings of shareholders on register at November 27, 2017 were split such that their holdings of ordinary shares became 10,000,000 ordinary shares. Additionally, the shareholders who were allocated the 9,800 available shares at March 31, 2017, were further allocated 314,848,485 ordinary shares for the consideration of $50 million of interest converted to capital on March 31, 2017. (13.3) On December 7, 2017 the company made an offer for subscription to the public (IPO), of 160,000,000 of its ordinary shares at a price of $2.50 per share through the Junior Market of the Jamaica Stock Exchange (JSE). The company was officially registered on the Junior Stock Market on December 21, 2017. Total cost of the IPO of $30.848 million has been off-set against the issued share capital.”
“The company has one class of ordinary shares which carry no right to fixed income.”
The company released its annual report without a line mentioning the resolution to convert the loans to preference shares. The prospectus does not state it as a contractual obligation as such the prospectus that has become the legal document containing the contracts terms and obligations of all shareholders as of December must be honoured. It did not report the issue of any new shares accordingly, the additional shares are improperly issued and is a variance with the terms of the public offer.
IC Insider.com raised this matter after the company released the first quarter results, we again raise the above in the interest of the integrity of the market. We now over pass this over to the JSE and the FSC to follow up.

Filed Under: Feature Stories, JSE Junior Market, Stock Market Tagged With: , , , ,

Investors shun Junior stocks for the oldsters

August 4, 2018 by

Black Panther mash up Palace bottom-line with a huge increase in profit that pushed to stock to no 1 for 2018 in the main market.

Investors shunned Junior Market stocks in 2018 for the older more established Main market stocks. At least that is what the data from the exchange is showing.
According to the Jamaica Stock Exchange report of trading to the end of July, volume and value on the main market is up while that on the junior market is well down on 2017 figures, even as the gains in the overall market shows juniors up 14 percent for the year to the end of July and 9 percent for the main market.
Junior Market volume is down year to July by a stunning 69 percent to 571 million units while the value fell 64 percent to $2.69 billion, less than half of the $6.6 billion traded for all of 2017. In contrast main market stocks traded 1.57 billion units, up 28.5 percent over 2017, for a total value of $32 billion, a strong 79.4 percent increase over 2017 and just shy of the $35.7 million traded for all of 2017.
The big winners for the year to July are, Palace with an increase of 154 percent, that was helped by the huge success of the Black Panther film that ran for several months, Pulse Investments up 67 percent, Kingston Wharves 60 percent, Jamaica Broilers 45 percent and Salada Foods 41 percent, as investors responded to improved profit. In the Junior Market, C2W Music and Derrimon Trading beat all others by huge margins, rising 233 percent after it announced a 10 to 1 stock split and 197 percent respectively. Express Catering climbed 86 percent, Stationery and Office Supplies up 65 percent and CAC 2000 up 51 percent.
The big losers in the main market are, Ciboney, having sold off the property it owned and paid out most of the proceeds as a dividend is down 68 percent, 138 Student Living fell 35 percent, Kingston Properties 31 percent, Wisynco Group 24 percent, Portland JSX 20 percent and in the Junior Market, GWEST Corporation down 36 percent, AMG Packaging 33 percent, tTech 23 percent, Knutsford Express 23 percent and Eppley 17 percent.

Filed Under: Feature Stories, JSE Combined, Stock Market Tagged With: , , , , , , , , , , , , , , , , , , , , ,

Junior Market jumps 47 points – Friday

April 20, 2018 by

The Junior Market fell at the close of trading on Friday with 19 securities changing hands as the prices of 7 securities advanced, 5 declined and 7 remained unchanged as market Index jumped 46.58 points to 2,947.73.
Trading ended with an exchange of 2,462,706 units valued at $9,020,103 up sharply from 1,190,114 units valued at $4,531,582 on Thursday.
Market activity ended with an average of 129,616 units for an average of $474,742 compared to an average of 62,638 units for an average of $997,673 on Thursday. The average volume and value for the month to date, amounts to 266,611 units at $566,937 compared to 140,892 units at $573,523 on the prior trading day. March closed with an average of 149,999 units valued at $623,819, for each security traded.
 IC bid-offer Indicator|At the end of trading, the Investor’s Choice bid-offer indicator reading shows just 3 stocks ending with bids higher than the last selling prices and 6 with lower offers.
At the close of the market, Caribbean Cream ended trading 80 cents higher at $4.80, with 30,000 shares changing hands, Caribbean Producers rose 35 cents to close at $5, with 14,955 units, Consolidated Bakeries closed with a loss of 5 cents at $1.95, trading 542 shares, Derrimon Trading concluded trading 10 cents higher at $9.50, with 40,270 shares, Elite Diagnostic settled with a loss of 5 cents at $3.15, exchanging 129,503 units. FosRich Group fell 14 cents to $2.41, with 13,924 shares, General Accident closed with a loss of 14 cents at $3.01, with 4,967 stock units trading, GWest Corporation ended at $2.50, with 9,050 units, Honey Bun concluded trading 15 cents higher at $4.60, with 86,460 shares. Iron Rock finished at $3, with 200,000 shares, ISP Finance settled 1 cent higher at $15.01, with 30,000 shares, Jetcon Corporation traded 25 cents higher at $4.50, with 131,031 units, KLE Group closed at $2.45, with 3,383 shares. Lasco Distributors concluded trading 13 cents higher at $4.15, with 147,874 stock units, Lasco Financial finished at $5.20, with 194,766 units, Lasco Manufacturing closed at $4, with 126,625 shares, Stationery and Office closed at $5.90, with 231,203 units and tTech concluded trading with a loss of 28 cents at $5.50, as 68,153 shares traded. In the junior market preference segment, newly listed Derrimon Trading 9% preference share closed at $2, with 1,000,000 stock units changing hands.
Prices of securities trading for the day are those at which the last trade took place.

Filed Under: Feature Stories, JSE Junior Market, Stock Market Tagged With: , , , , , , , , , , , , , , , , , , , , , ,

Junior Market jumps 59 points

December 27, 2017 by

Eppley traded 10 million of the 12 million shares to trade on Wednesday with the market index jumping 58.96 points to 2753.77 as 22 securities up from 19 on Friday.
By the close, the prices of 10 stocks rose 5 fell with 7 remaining unchanged as FosRich traded at an intraday high and GWest traded at record closing price of $3.75.
Trading on the Junior Market of the Jamaica Stock Exchange ended on Wednesday with 12,129,589 units valued at $129,945,470 changing hands compared to 8,996,675 units valued at $33,076,071 on Friday.
Trading ended with an average of 551,345 units for an average of $5,906,612 in contrast to 473,509 units for an average of $1,740,846 on Friday. The average volume and value for the month to date, amounts to units 528,301 valued at $2,651,778 and previously 561,932 valued at $2,583,423. In contrast, November closed with average of 107,477 units valued at $545,989 for each security traded.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows 6 stocks ending with bids higher than the last selling prices and 2 with lower offers.
At the close of the market, AMG Packaging ended 1 cent higher at $3, with 67,800 stock units, Cargo Handlers ended trading at $10.90, with 122,297 stock units, Caribbean Cream traded $1.20 higher at $6, with 21,781 units changing hands, Caribbean Producers closed at $4, with 11,843 shares, Consolidated Bakeries ended at $1.80, with 27,518 stock units. Dolphin Cove finished with a loss of 1 cent at $16.99, with 50,000 shares, Eppley settled 25 cents higher at $12, with 10,002,150 shares, Express Catering ended trading with a loss of 10 cents at $4.30, with 141,000 stock units, FosRich Group traded 311,953 shares and lost 4 cents to close at cents to end at $3.45, after trading at an intraday high of $3.55, General Accident traded with a loss of 25 cents at $2.75, with 272,416 units. GWest Corporation gained 45 cents in trading 265,396 shares and ended at a record close of $3.75, Jamaican Teas concluded trading 3 cents higher at $3.70, with 380 units, Jetcon Corporation finished with a loss of 30 cents at $4.40, with 36,924 shares, KLE Group ended trading at $2.50, with 6,787 stock units, Knutsford Express traded 20 cents higher at $15, with 6,300 units. Lasco Distributors finished trading at $3.99, with 416,117 shares, Lasco Financial closed 13 cents higher at $5.18, with 3,327 shares, Lasco Manufacturing ended 33 cents higher at $3.93, with 972 stock units, Main Event concluded trading 72 cents higher at $6, with 1,850 units. Paramount Trading settled at $3, with 2,410 shares, Stationery and Office ended trading at $4.90, with 200,281 stock units and tTech jumped $1.60 to $7, trading 160,087 shares.

Prices of securities trading for the day are those at which the last trade took place.

Filed Under: Feature Stories, JSE Junior Market, Stock Market Tagged With: , , , , , , , , , , , , , , , , , , , , ,

General public oversubscribed GWest 100%

December 21, 2017 by

GWest complex in Montego Bay,

Montego By based GWest Corporation’s Initial Public Offer of 169,689,500 shares, closed on the opening day, December 7, was oversubscribed by 41.3 percent, but the oversubscription by the general public exceeded 100 percent.
The level of oversubscription by the general public is amazing for company that is its infancy and generating a loss in its current fiscal year, with limited data on which to judge future earnings. Details of the level of subscription for the IPO was released by the broker for the issue, JMMB Securities.
Applications totaling 1334, were received for shares valued at $599,310,000. All the shares that were reserved were fully taken up, while General Public for which 69.7 million shares at $2.50 each, were available to purchase, received the first 10,000 shares applied for and 45.941 percent of the balance.

Dr. Konrad Kirlew, chairman of GWest.

GWest made a loss of $29 million in the six months to September this year and for the full year to March 2018, a loss of $111 million is projected, and is estimated to swing sharply to a profit of $166 million in 2019 and $388 million in 2020 as revenues rise from an estimated $158 million in 2018 to $803 million in 2019 to $1.2 billion in 2020. The shares are slated to be listed on the Junior Market of the Jamaica Stock Exchange.
Elsewhere, IC Insider.com gathers that VM Investments received applications in the range of more than 3,000, but less than 5,000, with the basis of allocation to be considered by the board on Thursday.

Filed Under: Initial Public Offers Tagged With: , , , ,

VM Investments 2 times over

December 13, 2017 by

Yet another Initial Public Offering crossed the line with demand exceeding supply as the latest issue by VM Investments to raise just under $700 million, has been oversubscribed and closed at the end on Tuesday.
“We were heartened by the overwhelming confidence demonstrated by Members of the Victoria Mutual family and the wider public. We closed today with subscriptions in excess of $2 Billion for the $689,261,487 offer” Devon Barrett, Victoria Mutual Group’s Chief Investment Officer said.
Barrett went on to say “we believe this augurs well for Jamaica’s economic growth and look forward to contributing to this growth by providing financing solutions for small and medium-sized entities in Jamaica. Details on the basis for allocation will be communicated to the Jamaica Stock Exchange in a subsequent advisory.”

Devon Barrett CEO of VMIL addressing invitees at the formal announcement of the IPO

A total of 225,003,750 Ordinary Shares in the Offer are initially reserved for staff and customers of the VMBS Group at discounts from $2.08 to $2.33 each and 75 million for the general public at $2.45 each. The offer which opens on December 11, was scheduled to close on December 18.
The company reported profit after taxes of $326 million, surpassing the $310 million made in 2015 and up to September profit of $273 million was achieved putting in on track for $360 for the year or 30 cents per share with PE ratio of 8, which is well below the average of the market 14.
Last week, FosRich and GWest closed with the issue oversubscribed and Wisynco closed with over $17 billion chasing a little more than $6 billion that was sought. Reports are that the Wisynco offer was heavily subscribed to by institutional investors.

Filed Under: Initial Public Offers Tagged With: , , , , ,