Japfa

Japfa: public offer opens today, to debut on Mainboard next Friday. Japfa is selling 248m shares (231.2m international offer + 16.8m public offer) at $0.80 each, against the lower mid indicative price range of $0.75 - $0.87. Japfa said it has received robust demand from institutional investors, with indications amounting to ~5.1x the international offer. Marubeni , the largest Japanese food commodities trader, will be an anchor investor. Current shareholders, the Santosa family in Indonesia, will remain the largest shareholder post IPO retaining a 77% stake. Japfa produces milk, poultry, and beef in Indonesia, and has replicated the same industrial farming business model in Vietnam, Myanmar and India for poultry and in China for dairy. The group also sells fresh milk, UHT milk and cheese under the Greenfields brand to consumers in Indonesia, where it holds ~38% of market share as market leader, and also exports to Singapore, HK, and Philippines. It also makes processed meat products under the "So Good" and "So Nice" brands in Indonesia and "So Yumm" brand in Vietnam. Net profit last year was US$41.8m (-22% ), while revenue rose 16% to US$2.7b. Japfa intends to use the net proceeds of $187.3m to develop its China dairy business, where profit margins are the highest, by building a second five-farm hub in Inner Mongolia. Credit Suisse and DBS are the joint global coordinators and bookrunners. CS is the stabilisation mgr.