[SINGAPORE] Car dealer Vin’s Holdings is looking to raise net proceeds of S$4 million in an initial public offering (IPO) to drive its expansion plans, as it issues 20 million placement shares at S$0.30 apiece.
This will mark the first IPO in Singapore since last November.
Based on the issue price, the company is expected to list on the Singapore Exchange (SGX) Catalist board on Apr 15 with a market capitalisation of S$39.3 million.
Of the S$4 million net proceeds, S$2 million – after accounting for listing expenses –will go towards Vin’s digital transformation and IT integration plans.
The initiatives comprise the expansion of its showrooms, workshops and after-sales services and will cost S$1.2 million. The other S$0.8 million will be used for general working capital.
Vin’s Holdings’ controlling shareholder, Vin’s Capital, will hold a 76.3 per cent stake in the company after the share placement. The entity is mostly owned by Vin’s Holdings chairman Vincent Khong, his wife Boong Lan Hiong, and his son Galvin Khong, who is also Vin’s Holdings’ chief executive officer.
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The remaining stake in Vin’s Holdings following the placement will be held by its deputy CEO Loke Wai Ming and the public – at 8.5 per cent and 15.2 per cent, respectively.
The company said it believes the IPO will enhance its public image locally and internationally, and enable the company to tap into the capital markets to fund its business growth.
The car dealer, whose businesses include the sale of new parallel-import and pre-owned motor vehicles, maintenance and repair services, as well as rental and leasing, currently has two car showrooms – one at Midview City in Sin Ming and another at Revv in Corporation Drive.
It also has a workshop at AutoCity in Sin Ming and an office at Carros Centre in Kranji for handling accident reporting and insurance matters.
For the latest nine-month period ended September 2024, Vin’s Holdings’ revenue edged up 1.1 per cent year on year to S$83.7 million.
Revenue from its automobile sales and related services – its largest business segment, which contributed to 80.6 per cent of total revenue in the first nine months of 2024 – fell 3.4 per cent to S$67.5 million, mainly due to lower demand for floor stock financing and a decline in new car sales. This was partially offset by higher pre-owned car sales.
Earnings for 9M 2024 fell 18 per cent to S$2 million, from S$2.5 million in the corresponding period the previous year.
The net profit decline was led by a 43.1 per cent jump in administrative expenses to S$6.1 million and a 26.2 per cent rise in finance expenses to S$1.5 million.
For the full year ended December 2023, the company recorded revenue of S$106.4 million and net profit of S$3.3 million for the full year ended December 2023.
The group said it expects its revenue to grow in 2025 due to factors including the anticipated decline in certificate of entitlement prices and the launch of a new showroom, focussing on pre-owned motor vehicles, that is set to open in the first half of 2025.
While Vin’s Holding does not have a fixed dividend policy, it said it intends to distribute 50 per cent of its full-year earnings in FY2024 as an “inaugural return to shareholders”, as well as an additional 25 per cent of its net profit as a special dividend.
RHB Bank will be the full sponsor, issue manager and placement for Vin’s Holdings’ IPO.
