PetroTrade applies for an IPO

PetroTrade applies for an IPO

Petroleum Trading Lao Co. Ltd (PetroTrade) has filed the regulatory application documents with the Lao Securities Commission Office (LSCO) to offer 60 million shares in an Initial Public Offering (IPO) to raise capital for expansion of its service station network in the country.

The shares are expected to go on offer at the price of 2,000 kip per share.
A press conference was held in Vientiane on Monday attended by the Head of the LSCO, Ms Vatthana Daraloy, Chair and CEO of Lao Securities Exchange (LSX), Assoc. Prof. Dr Dethphouvang Moularat and representatives of publicly listed companies in Laos and Thailand.

The IPO proceeds will be used for expanding the number of its service stations and for working capital in the company as it prepares for growth in the business and the arrival of the Asean Economic Community (AEC) at the end of 2015.

APM (Lao) Securities (APMLAO), PretroTrade’s financial advisor, has said the funds raised by the IPO would help PetroTrade to better compete with other companies and prepare for the potential opportunities in the future.
PetroTrade’s business is involved in the importation and distribution of oil and petroleum products through its stations under the PLUS trademark, the CEO of the company Mr Chanthone Sitthixay confirmed at the press conference.

Currently the company has paid-up capital of 350 billion kip and after listing this will increase to 470 billion kip if all the shares in the IPO are taken up.

PretroTrade owns and operates 107 service stations all over Laos under two systems, company owned company operated (COCO) and company owned dealer operated (CODO).

In addition to service stations, Petrotrade has oil terminals in Vientiane and in Champassak, Borikhamxay, Savannakhet and Luang Prabang provinces with a total capacity of 3.6 million litres.
CEO of APMLAO, Mr Somphob Sakpunpanom, said they had lodged PretroTrade’s regulatory filing documents with LSCO to list PretroTrade on the LSX.

This is an important part of PetroTrade’s business expansion and also enhances its competitiveness.
PetroTrade has submitted financial records for the past three years, reporting revenue of 905 billion kip and net profit of 15 billion kip in 2011, 1,091 billion kip income and 20 billion kip net profit in 2012 and 1,075 billion kip income with 16 billion kip net profit last year.

“PretroTrade also has a clear roadmap to become a leader in the fuel distribution business in Laos and plans to add more stations in the future after the company is listed on the exchange, so it will become stronger financially as well as portraying good credibility with a good management image.

“With these factors I believe the company will continue to grow for sure,” said Mr Somphob.
This is fourth company to sell their shares on the LSX and it is expected there will be more companies making IPOs next year.

At the moment there are three stocks on offer at the LSX, Banque pour le Commerce Exterieur Lao Public (BCEL), EDL-Gen and Lao World Public Company.

vientiane times