WiseVest - Sunshine Holdings: Should be a Buy

UOB Asia is the lead manager for this upcoming IPO - Sunshine Holdings. As the first China-based property developer to list on the mainboard of the SGX, this company seems to be riding on the wave of good sentiments amongst China counters. The company develops residential and commercial properties in Henan province and they have a focus on the 2nd tier cities of China, targeting mainly the urban middle class.

Sunshine Holdings is issuing a total of 249.6 million shares, of which 237.12 million are via placement, and 12.48 million for public subscription. The offer price stands at S$0.275 per share, which represents 4.8 times PER based on FY2004 earnings. Total NTA per share stands at S$0.290, which is usually used by analysts to judge the valuation of property companies. The company reported a revenue of RMB422 million (S$85 million) in FY2004, up from RMB112 million in FY2003. Net profit for FY2004 sands at RMB173 million (S$35 million).