Valuation
Based on a combination of a market approach based onmcomparable price-to-earnings multiples (P/E) and a Discounted Cash
Flow (DCF) model, we estimated a fair value of $4.54, providing investors with a potential upside of 127.05%. Based on our estimate of fair value, we believe a suitable margin of safety is present, underpinning our “PARTICIPATE” recommendation.
Strong Growth Potential: A greater portion of the global population is estimated to be over 60 years of age over the next ~30 years, which provides an opportunity for the Company to capitalize on the increased demand for healthcare services due to the aging population. The opening of new locations and offering additional modalities will also
likely help boost the Company’s operating performance. Furthermore, the healthcare industry is typically non-cyclical, therefore, as we expect to enter a period of weakening economic growth, the company will likely see a fairly muted impact on its growth.
OFFER SUMMARY
| Issuer | Regency Petroleum Co. Limited |
|---|---|
| Close Price | J$5.61 |
| Offer | Initial Public Offer of up to 247,889,936 Ordinary Shares Non-Reserved (General Public) Shares: 182,889,936 Employee Reserved Shares: 17,875,000 Key Stakeholder Reserved Shares: 42,125,000 Broker Reserved Shares: 5,000,000 |
| Lead Broker | JMMB Securities Limited |
| Subscription Price |
Non-Reserved (General Public) Share Applicants: J$2.00 per share II. Employee Reserved Share Applicants: J$2.00 per share III. Key Stakeholder Reserved Share Applicants: J$2.00 per share IV. Broker Reserved Share Applicants: J$2.00 per share |
| Minimum Subscription | Each Application for Shares must be for a minimum of 5,000 Shares, with incremental shares of 100 thereafter |
| Use of Proceeds |
I. To acquire property to be identified in Kingston which is suitable to relocate its largest operations II. To procure suitable new bio-medical equipment to offer additional diagnostic modalities at its Ocho Rios location III. To expand its offering of interventional procedures |
| Dividend Policy | If the company is admitted to the Junior Stock Exchange, the directors intend to pursue a dividend policy of up to 55% of distributable profits, which will be subject to the company’s reinvestment needs from time to time. The dividend policy is subject to review on a biennial basis by the Company’s Board on the recommendation of its relevant sub-committee(s) The intention is for the Board to consider dividend distributions on a semi-annual basis |
As at December 28, 2022
Image Plus Consultants Limited | IPO Analysis
