Apply here: https://goipo.jncb.com/
A new IPO just hit the Trinidad and Tobago market. Is West Indian Traders a good investment for you?
So West Indian Traders (WIT) is looking to raise about TT$10 million. That’s roughly US$1.5 million, or approximately J$233 million.
They’re doing an Initial Public Offering on the SME market of the Trinidad and Tobago Stock Exchange.
Now if you’ve never heard of West Indian Traders, they’re a wholesale distributor behind brands like Hyper Malt, Festival Cookies, Daisy Oil, Astonish cleaning products and several other consumer products sold across Trinidad and Tobago.
The company currently services more than 4,000 customers across the country. This includes supermarkets, pharmacies, schools and small shops. It generated approximately TT$81 million in revenue last year. That’s about $12 million USD or $1.9 billion JMD. And they say they’re continuing to grow.
West Indian Traders is offering just over 5 million shares at TT$2 each.
That’s about US$0.29 per share or approximately J$46 per share.
In total, investors are being offered about 22-point-5 percent of the company.
The minimum application is 50 shares, followed by increments of one share.
That means the minimum investment is only TT$100, which works out to roughly US$15 or about J$2,300, plus any brokerage fees.
The IPO opened on May 18 and is scheduled to close on June 5.
If all goes according to plan, investors should receive their allocations by June 26, with trading expected to begin around July 6.
NCB Merchant Bank Trinidad and Tobago is the lead broker and underwriter for the transaction. That means if the IPO is undersubscribed, NCB has agreed to purchase any remaining shares.
As for what the company plans to do with the money, part of the proceeds will be used to repay an existing $4.6 million TT dollar loan. That’s equivalent to roughly US$680,000 or about J$106 million. Management says that will improve cash flow and allow the company to focus more resources on expansion.
The company also has ambitious growth plans. Those include building a new 30,000-square-foot warehouse, expanding into chilled and frozen products, launching a B2B e-commerce platform and increasing exports across the Caribbean.
Now, as with any IPO, investors should do their own research.
West Indian Traders is profitable and growing, but it also operates in a highly competitive distribution market and faces risks including foreign exchange shortages, rising shipping costs and liquidity challenges on the SME market.
And that’s The Bottom Line.
So what do you think? Would you invest in West Indian Traders, or would you pass on this IPO?
