Prior to his retirement, Chan Kit Whye (left) worked more than 30 years as Regional Finance Director, Financial Controller and Manager in a multinational specialty chemical business. He has played an active role in CPA (Australia) Singapore Branch, taking up positions in its Continuing Professional Development and Social Committees. Kit Whye is a Fellow of CPA Australia, CA of Institute of Singapore Chartered Accountants and CA of the Malaysian Institute of Accountants. He holds a BBus(Transport) Degree from RMIT, MAcc Degree from Charles Sturt University and MBA from Durham Business School.AT THE BEGINNING of June, QT Vascular's share started to climb from its base at around 40 cents to its recent 52.5 cents.
But its financials are very weak. For its first quarter ended March 2014, the company reported a loss of US$9 million, double the loss of its previous year's similar quarter.
Its equity is negative to the tune of US$20.8 million, current liabilities is 3.8 times its current assets.
Subsequent to this report, the company raised $55 million from its IPO.
I suspect that part of its proceeds will be utilised to repay its unsecured debt of $15 m.
What drove its share price to the current level?
The placement share price, according to its IPO Prospectus, was 28 cents. The company has not reported any significant improvement in its new business that would deserve to bring up its share price currently.
Obtaining approval for its coronary Chocolate PTA Balloon Catheter is different altogether from getting market share and growing the business to become profitable, sustainable and enhance shareholders' value.
In this case, the company has not said anything to that extent, while the analysts' research reports were making assumptions. I hope that I am wrong.
Recent reports:
QT VASCULAR -- target 64 c; YANGZIJIANG -- $1.55
QT VASCULAR -- Target 60 cents, HANKORE -- 91 cents
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