I spoke with Investec (The Bookrunner) with regards to the IPO for Blue Label Telecoms and they indicated that they will be meeting with Standard Bank this morning with regards to this IPO. In the Pre-Listing Statement, the closing date for applications is this Thursday at 12h00. The question then becomes whether we will have an opportunity to partake in this IPO?
Scary stuff for mere mortals.... From moneyweb At 880c, the share is 56 times pro-forma headline earnings in the year to May 2007 and 26,2 times heps forecast for the year to May 2008. The prospectus says Blue Label has grown taxed profit by 57% pa for the past five years
I can not believe the hype that has been created over this new listing and the fact that the mkt cap is R6.6billion. It will be interesting to see what price this share will be trading at in 12 months time especilly if the mobile networks (e.g Vodacom) decide to reduce the margins they share with their distribution. What is for sure is that you definitely can not factor 56 times earnings in any telecoms company, espcially a distributor. In my opinion (for what it is worth) even 10 times is pushing it. Look what happened to Celcom's share price on the Altx - they are also a distributor. Oh well, some chaps will have to learn the hard way. Others might say I don't know what I am speaking about.