5 hot summer IPOs

Initial public offers have been extremely popular amongst investors who have made good money from the vast majority of them. Come this summer investors will get five more opportunities to invest in IPOS.
The last issue, Wigton Windfarm made several thousands investors happy, with the price rising as high as 90 percent over the IPO price of 50 cents. Even now that it is trading lower than the peak, investors are still more than 40 percent up on the initial price. Investors in the year’s first IPO, iCreate are not that lucky as the $1.01 they paid for the stock fell as low as 70 cents since and remains well below the IPO price.
Coming this summer are, The Lab that styles itself as a fully integrated 100 percent Jamaican born and bred advertising agency with global reach and an island swagger.

Kimala Bennett, Managing Director of The Lab.

Kimala Bennett is the company’s Managing Director. NCB Capital Markets are the brokers for The Lab, that could be looking at regional expansion. Clients include National Commercial Bank, JPS. Wendy’s Dominos, Supreme Ventures, Wray and Nephew, Grace Kennedy, Caribbean Broilers, Digicel. Persons in the know say this is one of those IPOs to plan for, as it is unique and profitable. NCB Capital Markets is also taking Eppley Property Fund, a company that owns property across the Caribbean, to market this summer as well as QWI Investments, a new company that invests in listed shares.
NCB Capital Markets is also brokers to Tropical Battery Company. The company expects to come to market in July, to raise around $200 million in an IPO our sources state. The company was founded in 1950 and later purchased by John Melville and remains in the  family, since. The company’s core business is the sale of automotive batteries, complemented by the distribution of several local and world renowned automotive consumer brands. Tropical Battery’s headquarters is located in Kingston, with distribution centres in Kingston and Montego Bay.
Another that will be coming to market is Sagicor Select Funds Limited an Exchange Traded Fund that is going to market in June to raise $5 billion. The fund according to Sagicor Investment CEO, Kevin Donaldson, will track the JSE Financial Index and will be rebalanced if needed, monthly. Donaldson indicates that the fund currently has assets of $1.2 billion already. Sagicor Investments could have 2 to 3 additional listings before the year ends.
When completed, the new listings on the Jamaica Stock Exchange will raise the listed ordinary shares to more than 80 and total listings to more than 100 securities.

Where is NCB heading $150 or $165?

NCB Financial has been scaling record highs after record and closed on the Jamaica Stock Exchange at $139.99 on Monday as well as a new record high close on the Trinidad and Tobago Stock exchange.
The chart shows the stock moving side ways from November last year after reaching $110, until June this year before it started its climb. The move higher was spurred by record profit for 2018 and later by the announcement that they would be going after another 22 percent of Guardian Holdings’ shares. Last week directors and executives bought $650 million of NCB shares which including the sale of a lesser amount by one insider.
The chart shows short term resistance at $150 with the trendline going back to 2015, there after if and when it breaks the $150 level, then it should move on to $165. Going forward, with pick up in growth in Jamaica’s economy, NCB should have good long-term prospects of growth, ahead of it. The company should earn around $12.50 for the 2019 fiscal year and that should put the price at $190 or more in 2019.
Since July 13 last year NCB has gained 48 percent in rising from $94.50 to Monday’s close of $139.99 on the Jamaica Stock Exchange.

Junior Market trading doubles Monday’s

Trading on the Junior Market closed on Tuesday with 22 securities changing hands, resulting in a more than doubling of trading levels over Monday with an exchange of 2,217,305 units valued at $9,814,861 compared to 904,019 units valued at $4,463,382 on Monday.
The Junior Market Index declined by 3.62 points to close at 2,902.38 as market activity resulted in the prices of 5 securities advancing, 6 declining and 9 remaining unchanged.
Trading ended with an average of 100,787 units for an average of $446,130 in contrast to 43,049 units for an average of $212,542 on Monday. The average volume and value for the month to date amounts to 78,790 units valued at $343,165, previously 74,618 units valued at an average of $323,637. In contrast, September closed with average of 116,176 units valued at $538,652 for each security traded. Trading ended with the market sentiments looking mixed for Wednesday, as 4 stocks ended with bids higher than their last selling prices and 2 with lower offers.
In market activity, volumes are those traded for the day and the closing prices are those at which the last trade took place. Trading ended with Access Financial plunged $4 to close at $38, with a mere 100 stock units changing hands, AMG Packaging closed 5 cents higher at $3.35, with 50,395 shares, Caribbean Cream rose by 10 cents to $6.10, with 170,000 units, Caribbean Producers ended 4 cents higher at $3.74, with 15,240 shares traded, Consolidated Bakeries settled at $2.02, with 26,000 units. Dolphin Cove closed at $17.50, with 7,438 stock units, Eppley concluded trading at $12, with 1,500 shares changing hands, Express Catering traded 10 cents higher at $4.50, with 192,607 shares, General Accident fell 3 cents at to $2.70, with 837,115 stock units traded, Honey Bun traded with a loss of 1 cent at $4.09, with 3,420 stock units. Iron Rock traded at $2.80, with 6,245 units, Jamaican Teas settled at $4.10, with 23,280 stock units, Jetcon Corporation closed with a loss of 50 cents at $4.50, with 13,419 stock units, Knutsford Express concluded trading at $14.89, with 4,188 stock shares. Lasco Distributors traded 619,619 units at $6, Lasco Financial settled at $4.25, with 52,621 shares, Lasco Manufacturing ended 25 cents higher at $3.75, trading 3,100 stock units, Main Event finished with a loss of 3 cents at $5.15, exchanging 61,685 shares, Medical Disposables lost 15 cents at $5.15, trading 1,899 shares and Stationery and Office closed at $4.70, trading 81,373 stock units. In the junior market preference segment, Eppley settled with a loss of 5 cents at $6.50, with 45,961 units changing hands.

Circuit Breaker rule could be changed soon

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JSE logoAfter years of clamouring for a change investors may see some modification of the existing circuit breaker rule that prevents the value of any one stock from changing more than 15 percent from the closing value of the previous day. The JSE management is proposing that the 15 percent limit be moved to 30 percent and that the freeze would be for an hour.According to our sources, the Exchange is proposing a move towards an intra-day setting of the circuit breaker which allows a ‘cooling off’ of the market in transactions of that particular stock, but does not prevent the stock from trading again within the day, at a prescribed level. This change should provide investors with a more liquid market and a by-product would, be increased level of transactions that would be of benefit for the entire industry.The stock exchange board has not yet signed off on the proposal which could undergo further modification if implemented.
Many investors have expressed dislike for the circuit breaker as they see it as impeding trading which it does. While the Jamaica Stock exchange has stuck to the current system, Barbados moved a few years ago to a more flexible one in which there is a break for a limited time so that brokers can make contact with their clients who may want to buy or sell as the case may be and trading in the stock resumes.
The Jamaica Stock Exchange introduced a circuit breaker rule in the 1990s sometime in an attempt to moderate price movements of a stock each trading day. While some persons will indicate that it is 15 percent above or below the closing price of a stock, in reality while that is the primary basis the rule allows for it to be the lower or higher of the bid or asking prices where these are higher of lower than the sale price. An illustration will help. If stock “A” sold at $10, but the offer was $10 or more and the bid is $10 or lower, then the maximum price movement permitted the next day would be 15 percent or $1.50. If however, the closing bid was $12 then the stock can trade the next day up to $13.80 or $1.80 or 15 percent above the bid or $3.80 which would be 38 percent above the last traded price. The reverse would be true, if the offer was lower than the last selling price of $10.