Posted on September 14, 2009 - by kevinscully

Sinomem does placement of 50mn new shares at S$0.62 and raises about S$31mn

Photo by Leonid Mamchenkov

Sinomem placed out 50mn new shares at S$0.62 cents  and raised about S$31mn (read its announcement).  A broker had rated the stock a buy last week and we understand that the company is currently on a road show which included Hong Kong and London.

The placement is timely as the company has a S$50mn CB that is due at the end of this year.  It does have cash of more than S$70mn but as it ventures more into BOO projects – it would need more long term funding……this placement would beef up its balance sheet cash position net of the CB to more than S$50mn.   I still like the share and believe that on a medium term basis, it can still offer further upside especially when it executes its BOO projects well.  The latter by creating a long term recurrent profit stream willl enable Sinomem to trade at a higher PER valuation. Read more…

Related posts:

1. China Animal Healthcare – raises US$45mn through a placement to Blackstone Capital Partners VLP…..what does this mean for one of my Stock Picks
2. Sinomem reports Q3-2009 net profit of S$5.1mn and 9 month net profit of S$15.8mn up 54% from the same period in 2008
3. United FTSE/Xinhua China A50 ETF – Getting access to A Shares