| NOTICE
: Kim Eng Securities (Thailand) Public
Company Ltd. (KIM ENG) has participated as an
underwriter in relation to the initial public
offering of Matching Studio Public Company Ltd. (the
Company). This document was prepared by KIM ENG
independently of the Company. In particular, the
forecasts, opinions and expectations expressed in
this document are entirely those of KIM ENG and are
given as part of its normal research activity and
not as an underwriter of the share offering or as an
agent of the Company, any other syndicate member, or
any other person. While all reasonable care has been
taken to ensure that the facts stated herein are
accurate and that the opinions and expectations
contained in this document are fair and reasonable,
neither KIM ENG nor the Company has verified the
information given in this document. Accordingly, no
representation or warranty, express or implied, is
made as to the fairness, accuracy, completeness or
correctness of the information contained in this
document. No one at KIM ENG, the Company or any
other person, or any of their respective directors,
officers or employees, accepts any liability for any
direct or consequential loss arising from any use of
this document or its contents or otherwise arising
in connection therewith. |
Matching Studio (MATCH) will
make its debut today on the Market for Alternative
Investments (MAI). Last month, the company offered shares to
the public at Bt34. The Bt204mn proceeds raised is being
used to invest in new equipment and studio, expand the
group's businesses, repay loan and strengthen its working
capital.
IPO Profile
|
Paid-up capital
before IPO |
: |
Bt90mn (18mn shares) |
|
Par |
: |
Bt5 |
|
Share offer |
: |
6mn shares |
|
IPO price |
: |
Bt34 |
|
Proceeds |
: |
Bt204mn |
|
Paid-up capital after
IPO |
: |
Bt120mn (24mn shares) |
|
Objective |
: |
1) Bt60mn to invest
in new equipment and studio |
|
|
|
2) Bt35mn to expand
group's business |
|
|
|
3) Bt30mn to repay
loan |
|
|
|
4) Strengthen working
capital |
|
Subscription period |
: |
February 27-28, 2003 |
|
Listing date |
: |
March 11, 2003 |
|
Lead underwriter |
: |
NATSEC |
Source : Matching Studio and Kim Eng Research estimates
MATCH is the largest
production house in Thailand with market share of 8-10%. The
company's major income is from ad production, representing
57% of total revenues. The company, its five subsidiaries
and one affiliate are also involved in TV production, event
marketing and film equipment rental.
MATCH will benefit from ad
spending growth estimated at around 10-15% this year, as
well as the increase in the number of movies filmed in
Thailand. In January, TV ad spending rose 19% yoy. The
latest estimate has the number of movies filmed in Thailand
doubling this year from 24 in 2002 to approximately 50.
MATCH plans to make its own movie this year – Se-Aui.
We forecast MATCH's sales
this year will increase to Bt758mn with net profit of Bt73mn
or Bt3.06/share. Based on 40% dividend pay-out ratio, we
expect the company to pay dividends of Bt1.22/share.
After repaying its loan from
the IPO proceeds, MATCH will be in a net cash position.
Given its relative small
asset size and revenue base, we believe MATCH should trade
at lower PER multiple compared with other entertainment
stock. Fair value estimate of MATCH, based on PER 12x, is at
Bt37.
Matching studio’s earnings
summary