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IFS Capital chairman Lim raises stake; director Zee of JEP on a buying spree

The Edge Singapore
The Edge Singapore • 3 min read
IFS Capital chairman Lim raises stake; director Zee of JEP on a buying spree
This is also the first time in more than two years that Lim has increased his stake. According to the company’s filings, Lim’s last purchase of 445,000 shares at 24 cents each was made on Dec 4, 2017.
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SINGAPORE (Mar 27): Lim Hua Min, chairman and controlling shareholder of IFS Capital, has raised his stake in the insurance and factoring service provider, to 60.234%.

On March 18, Lim bought 150,000 shares on the open market through an entity called Phillip Assets for a total of $27,000 which works out to an average price of 18 cents per share. The following day, he bought another 250,000 shares at 17.6 cents each. With the purchase, Lim now has a deemed interest of 226.46 million shares in the company.

This is also the first time in more than two years that Lim has increased his stake. According to the company’s filings, Lim’s last purchase of 445,000 shares at 24 cents each was made on Dec 4, 2017. Earlier on Dec 1, 2017, he had also bought 6,000 shares at 23.5 cents each.

Lim’s latest share purchase was made amid the recent market selldown, of which IFS Capital was not spared. Year to date, the company’s share price has dropped 23.5% to close at 17.6 cents on March 24. At this level, the company is trading at 7 times historical valuation and has a market value of $66.2 million

The company is also trading at a significant discount to its book value. As at Dec 31, 2019, the company’s NAV was 47.6 cents per share, compared to 45 cents as at Dec 31, 2018.

In FY2019 ended Dec 31, 2019, IFS Capital reported interest income increased by 19.5% to $33 million from $27.6 million in FY2018.

Profit for the same period decreased by 39.1% to $12.1 million from $19.9 million as FY2018’s earnings were lifted by a one-off gain of $16.3 million from the sale of an office unit at Suntec City.

Excluding the one-off, IFS Capital FY2019’s pre-tax profit more than doubled from FY2018, thanks to better net interest margins of 6.9% for FY2019, compared to 6.6% in FY2018.

IFS Capital attributes the better operational performance in FY2019 to better credit control, which reduces provision and impairment even as it grows its loan books, and the introduction of various productivity measures. It also managed to improve its cost to income ratio to 55% in FY2019 from 61% in FY2018.

The company has declared a final dividend of 0.78 cents per share for FY2019, up from 0.55 cents per share in FY2018.

Zee on a buying spree

Zee Hoong Huay, an executive director of JEP Holdings, spent nearly half a million dollars this past month, steadily acquiring more shares on the open market in the company he founded three decades ago.

On March 23, Zee paid $30,000 for 200,000 shares, which works out to an average of 15 cents per share. Before the latest purchase, Zee had also bought shares on Feb 28 as well as March 2, 3, 4, 5, 9, 11, 12, 13, 16, 17, 18 and 19. The number of shares he bought during the period ranged from 27,000 shares on March 5 to 400,000 shares on March 13 with average prices ranging from 17 cents to 21 cents.

With his March 23 purchases, Zee holds a direct stake of 54.37 million shares, or 13.13%, in JEP. His wife, Lee Pui Rong holds nearly 7.76 million shares. Zee, therefore, now owns a total of 62.13 million shares, or 15% of the company.

In FY2019 ended Dec, JEP reported earnings nearly trebled to $6.52 million from a year ago as gross margins improved three percentage points to 18% from 15%. Revenue rose 3.6% to $89 million.

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