ISOTEAM: Orderbook $70.5 m, target price 82 cent

RHB Research analyst: Jarick Seet (left)

ISOTeam (ISO SP) have announced that they have placed out 9 million new shares at SGD0.58/share, representing a 8.9% discount to the volume weighted average price of SGD0.64. This represents approximately 6.72% of the groups existing issued and paid up capital.

One of the placees is an institutional investor who has subscribed for 6.5 million Placement Shares while the remaining 2.5 million Placement Shares have been subscribed by individual investors.

The transaction will raise approximately SGD5.04m in net proceeds which the Group intends to use to fund its capital expenditures, inorganic business expansion and general working capital. Its orderbook rose to SGD70.5m as of Jan 2015, which provides good visibility into 2015 through 2016, and is a reflection of the market’s belief in its proven track record. In view of its bright outlook, we maintain BUY with a DCF-backed TP of SGD0.82.