Thursday, 19 July 2018

Simple Attempt At Estimating Koufu's 6 months Results

Koufu (SGX:VL6) Was listed on 18 July

The Prospectus can be found here

Personally i had taken a look at the prospectus and was pretty keen on applying for the IPO as it seems to be relatively well priced when compared to Kimly Limited.

However on a closer look of the 402 page prospectus, something caught my eye

Shareholder's Equity from Page 101/402
30 April 2018 Shareholder's Equity from Page 73/402

Since Retained Earnings is from Profits, we can infer that Koufu has earned
37924-30600= 7324 ('000) 
Or if you would use the unaudited pro forma found on page 327/402, which is 29,861
37924-29861= 8063 ('000)

In 4 months it has earned the above amount, so a rough gauge of 6 months and 12 months results will be
6 Months  1098600/12094500
12 Months 21972000/24189000

6 Months EPS 1.98 cents/ 2.18 cents
12 Months EPS 3.96 cents/ 4.36 cents

For reference, Profits in 2017 amounted to 26819000 or EPS 4.83 cents
In the worse case scenario, core earnings would have plunged 18%
In the better case scenario, core earnings would have plunged 9.73%

Not forgetting that they will have to pay off the IPO Expense which amounts to 2.5 million


I do feel that Koufu will have to do quite a bit to improve their earnings given how it has done in the current 4 months.