ItsMoneyMark Newsletter #87

Regency Petroleum: Basis of Allotment for their IPO – Initial Public Offer, Ready to Go!

Well, the numbers are out… 

Investors who applied to become shareholders in Regency Petroleum IPO, for the “general pool” the most important pool, will get, their 1st 10,000 shares, and thereafter, they will get approximately 5.3% pro-rata share allocation. 

It continues to show, SMEs, the smaller IPOs – Initial Public Offers, if you can get in them, that is where, there is some serious “alpha”, meaning upside. The oversubscription rates continue to be very high, despite Mr. Market being softer. 

Jamaica Broilers Group Limited: Appoints new Director 

Effective December 7, 2022, Jamaica Broilers Group Limited (JSE: JBG), The Chicken King has appointed a new Director. 

The Company welcomes, Mr. Ian Haynes, as a Director. Per google, as JBG did not release a background, bio on Mr. Haynes, he is the CFO of SRI – Sandals Resorts International. 

Massy Holdings: On the Move, Strikes Deal & Acquires AIR LIQUIDIE T&T

Massy Holdings Ltd on November 28th, 2022, approved the acquisition of Air Liquide, Trinidad and Tobago Limited by Massy Gas Products Holdings Ltd (“MGPHL”), a wholly owned subsidiary of the Company. 

On November 28th, 2022, MGPHL entered into a Share Purchase Agreement with Air Liquide International S.A. to purchase 100% of the share capital of Air Liquide for US$ 51.5 Million – US$ 58 Million; with a higher end range related to an earnout that is payable annually based on additional value considerations being met. 

The acquisition of Air Liquide, a manufacturer and supplier of industrial gases (oxygen, nitrogen, and argon), is aligned with the MGPHL portfolio strategy to focus operations and its growth agenda on its core business. 

The acquisition will represent an 11.4% increase in the Massy Group’s assets and will contribute to an increase in the Group’s profit of approximately 3%. For the Gas Products Portfolio, the acquisition is expected to increase its profit before tax by 14%.

At ItsMoneyMark we have long advocated this, and are happy to see this, that is the earnings guidance provided by MASSY when executing a material deal. This should become the norm, and we do opine and suggest, that more and more listed companies should follow suit. 

Market Moves:

  • Supreme Ventures Limited (JSE: SVL), sees more action coming into its shares, with further “skin in the game”. As reported on the JSE – Jamaica Stock Exchange, a related entity purchased 400,000 shares of SVL between November 28 – December 1, 2022. 

SVL is currently trading on or around J$ 27/ J$ 28 per share. SVL’s market cap is approximately J$ 72.8 billion with its 52-week high at J$ 34.67 per share. 

To note, at current price levels, SVL is trading just above its 52-week low/ high, price mid-point. 

  • Jetcon Corporation Limited (JSE: JETCON), reports to the JSE – Jamaica Stock Exchange, surprisingly, a Director sale of shares, of 850,000 JETCON shares on November 28, 2022.

JETCON has been recently trading on or around J$ 1.05/ share, with a market cap of around J$ 612 million. Outside, of tTech Limited, JETCON has one of the lower market caps on the JSE – Jamaica Stock Exchange. 

Although it is fine, for a Director to take some cash/ liquidity off the table from time to time, this is at a relatively low valuation for JETCON

  • Kingston Wharves Limited (JSE: KW), one of the more underrated stocks on the market, has paid a good dividend here. 

J$ 43 cents per share with a payment date of January 17, 2023. 

Kingston Wharves earnings having been growing from strength to strength pretty much every quarter, and they have not slowed down. Additionally, they have been very innovative, continuing to launch new products & services at KW. The share price is around J$ 30, approximately within 10% of its 52-week low of J$ 27.15. 

KW is not a “hype or darling stock of the market”, but it continues to deliver, strong earnings performance, and eventually it is these types of companies, that provide the substance, that you will wake up one day, and see that the market cap will be much higher… 

  • Jamaica Producers Group Limited (JSE: JP) with the capital distribution. We thought it might have been bigger, with their massive deal coming up with PanJam Investment, but any money back, for shareholders, whether a dividend or a capital distribution, is welcome, well received, and especially in our markets, it does build and help stock demand long-term, and confidence. 

The capital distribution is J$ 30 cents, to be paid on January 19, 2023. A Happy New Year from JPG, JP!

JP has published their all-important Amalgamation Booklet & Explanatory Statement and the big date of the EGM is coming up right before Christmas on December 22, 2022. 

  • Indies Pharma Jamaica Limited (JSE: INDIES) just reported its year-end, and even though the 4th quarter was softer, INDIES pulled through nicely for its year-end, for the period ended October 31, 2022. 

The pharmaceutical space and the space overall, that INDIES is in, whether publicly traded or private has become “very hot” and in turn competitive. Maintaining and gaining market share, should be interesting for INDIES in the years to come, and how they plan and discuss their market strategy at their respective AGMs – Annual General Meetings. 

By the numbers, we look at the full year, unaudited numbers:

  • Revenue improved to J$ 937 million versus J$ 846 million, + 11%
  • Net profit surged to J$ 225.8 million
  • Earnings per share registered a material improvement to J$ 17 cents versus J$ 13 cents,    

+ 31%

Cash & cash equivalents closed the year-end, improving to J$ 233 million. INDIES market cap is on or around J$ 3.8 billion. 

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