Halcyon IPO

Halcyon IPO: IPO debuts today. Grp placed out 61m Placement Shares, comprising 44m New Shares and 17m Vendor shares at $0.36 each. The market cap based on the IPO price is $104.4m. Co. operates in the midstream of Natural Rubber supply chain, specializing in processing and merchandising of Natural Rubber. According to the prospectus, it is one of the largest exporter of Natural Rubber in South Sumatra, Indonesia. Major customers include Cooper Tire, Bridgestone, Sri Trang and New Continent. The NAV per share post IPO will be 15.49c. Based on an annualized FY12 net profit, grp will trade at just 7x P/E. We note that GMG currently trades at 18x P/E & Sri Trang at 16.3x P/E. Assuming 25% payout ratio, the implied yield will be around 3.5%. Grp has a low freefloat of just 20%. We note that Pegging Halycon’s annualized FY12 P/E to Sri Trangs P/E could equate to a theoretical share price of $082, although caution that Halcyon’s size/operations pales in comparison to its larger peers of GMG and Sri Trang.