SGD New Issue Review : International Healthway Corp 3Y 6%


– New 3yr SGD announced post roadshow
– Price Guidance at 6.00% area
– Anchors well in place
– Timing: As early as today’s business

** PB concession:  50c

– Comps:
Cordlife 4.9%  17    99.00 / 5.29%
Courts Asia 4.75%  16  102.38 / 2.79%
First Real Estate Investment Trust 4.125% 18  100.80 / 3.86%

International Healthway Corp., Ltd. is an integrated healthcare services and facilities provider. The  Company owns, manages and operates hospitals and nursing facilities, mostly in Japan, China and Malaysia.

Market cap : SGD 448.9 mio, IPO in Jul 2013 at 48 cts, currently trading 0.275 cts and listed on Catalist. 2 analysts cover this stock with a strong buy and a sell call which is kind of strange. The company is obviously not on many radar screens.

Income dropped last year and earnings are barely enough to cover interest expense. Their profits from 2012 and 2013 came mostly from non operating sources. And in 2016 they will see increased earnings from their real estate business in KL and China where they are developing  mixed use  medical facilities combined with other commercial retail centres and service residences.

ihc revenues

Now they in talks to buy a retail mall in Penang and I am not sure about their business model as highly geared as they are. This bond is supposed to be making up for some loans that are maturing which means banks are not willing to lend at 6% ? Wow, I am not sure what to make of that.

I have no strong view on this name. 6% sounds like a number to excite the retail client who better not be moaning like some readers about the illiquidity of their TA Corp etc.

Good luck !