Superboard approves Egat's infrastructure fund plan
The Nation

BANGKOK: -- The Superboard of state enterprises yesterday agreed to allow the launch of a Bt20-billion infrastructure fund for the Electricity Generating Authority of Thailand (Egat), making this the first fund to be launched by a state enterprise.

The fund is expected to submit its initial public offering (IPO) application to the Securities and Exchange Commission by the year-end, Kulit Sombatsiri, director-general of the State Enterprise Policy Office, said after meeting the State Enterprise Policy Commission or the Superboard.

"It will be backed by income for over 20 years from Egat's North Bangkok power plant," he said, adding the IPO will open for subscription within the first quarter of next year.

Kulit said Airports of Thailand and Expressway Authority of Thailand would launch similar funds.

"Initially, the yield rate will be about 5 per cent annually," Kulit added, saying his office would hold talks with the SEC about the launch of infrastructure funds and their size.

Source: http://www.nationmultimedia.com/business/Superboard-approves-Egats-infrastructure-fund-plan-30247095.html


-- The Nation 2014-11-06

An initial rate of 5%..........

May be worth watching......

Publicly listed company common stock does not guarantee a yield, even when the company makes a profit. What possible yield the Egat is capable of should be reflected in its historical and projected operations. Also be aware that in IPO's the initial stock price often will drop 30-40% within the first three months due to stock hype created by the brokerage firms that sponsor the IPO. They typically get paid in stock for their services and can cash out within the first three months. When income is derived from an established electrical generation facility, stock appreciation may be limited. Should the facility capacity be increased, capital to fund growth will likely come from additional stock offerings that can dilute current value of stock.

Propsective buyers need to read the IPO prospectus carefully, understand the risks of investment, and know their financial expectations.