SGD NEW ISSUE REVIEW : Q&M Dental Group 3Y 4.75%

Issuer:  Q&M Dental Group (Singapore) Limited
Issue Rating: Unrated
Status: Senior, unsecured
Distribution:  As per Information Memorandum, Singapore selling restrictions under Section 274/275 of  SFA
Format/Docs:  Reg S Bearer / Issuer’s SGD200million Multicurrency Medium Term Note Programme
Tenor:  3-Year
Price Guidance:  4.75% area
Coupon Payment :Fixed Rate, semi-annual, actual/365 (fixed)
Issue Size:  TBD
Redemption upon Cessation or Suspension of Trading of the
Issuer’s Shares:  In accordance with the Programme
Redemption for Taxation Reasons: Yes, in accordance with the Programme
Denomination: SGD250K
Governing Law:  Singapore Law
Listing: SGX-ST
Clearing: CDP
Joint Bookrunners: DBS, HSBC (B&D), UOB
Timing:  As early as today’s business

Q&M DENTAL GROUP 3Y SGD

* NEW 3Y SGD ANNOUNCED
* PRICE GUIDANCE AT 4.75% AREA
* TIMING: AS EARLY AS TODAY’S BUSINESS

 

** Please view corporate presentation at:
http://infopub.sgx.com/Apps?A=COW_CorpAnnouncement_Content&B=AnnouncementLast3MonthsSecurity&F=J54GJ15LI7H93CG8&H=1e919ca2a4de4d60f94e5c4bffbcfbb0a845c29e76f04c1ab7d436d8aef41428

Credit Highlights:

– Q&M Dental Group (Singapore) Limited is a private dental healthcare group listed on the Mainboard of the Singapore Exchange (market capitalization of SGD408.8 million as at 10 Mar 2015). The Group focuses on comprehensive dental services, dental supplies and equipment distribution, dental supplies manufacturing and general practice medical services.

– In Singapore, the Group has established its presence as the largest private dental healthcare group with a team of approximately 180 dentists that operate 60 dental outlets and 1 mobile dental clinic strategically located island-wide. The Group also runs 2 supplies and equipment distribution companies in Singapore.

– In the past 4 years, the Group has also begun to expand its presence in Malaysia (4 dental outlets in Johor Bahru, 1 dental outlet in Malacca, 3 dental outlets in Kuala Lumpur, and 1 dental supplies and equipment distribution company in Malaysia) and the PRC (3 dental hospitals and 4 dental clinics in Shanghai and Shenyang, and 1 dental supplies manufacturer in Qinhuangdao) via various joint venture and acquisition projects.

– The Group’s significant shareholders include International Finance Corporation (IFC), a member of the World Bank, with a current shareholding of approximately 2.9% and IMC Group which currently owns approximately 9.3% of the outstanding shares.

************************

The dentist strikes !

Q&M Dental Group Singapore Pte Ltd. operates dental clinics.  The Company offers aesthetic, children’s and general dentistry; fits crowns, dentures and braces; and offers bleeding gum treatment, gum surgery and oral surgery; and treats snoring and teeth grinding.

And they are doing well which means more people are getting bleeding gums (apologies for my fixation on this particular ailment) ?

Nothing really much to say about the financials which look nice and clean, reminding me of Overseas Education or one of those from last year.

Their market share and distribution channels have now put them in a good position to expand laterally, widening their product offerings and now they have LUNG SPECIALIST CENTRE and DIGESTIVE & LIVER SPECIALIST CENTRE.

At the 4.75% coupon tag, I think the uptake will be forthcoming, name familiarity will be a small hurdle (given their IPO in 2009). Their MTN programme is for SGD 200 mio and I do not expect liquidity to be terrific.

3 year interest rates are chopping around their 5 year highs at 1.76%, but at 4.75% ? It’s no wonder they were in a hurry to push out CWT yesterday.