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"CIFL" IPO

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"CIFL" IPO

Post by wgsaman on Mon Jun 27, 2011 7:47 pm

What do you think about CIFL
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Re: "CIFL" IPO

Post by mark on Mon Jun 27, 2011 8:30 pm

why so hurry.....wait wait........
as i know still prospectus is pending,good that you interested in IPO's,but nowadays most are slops bcoz of unethical practices in PP....
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Re: "CIFL" IPO

Post by hettdas on Mon Jun 27, 2011 11:23 pm

I don't think CIFL is a good company. I had a fixed deposit with them.They couldn't repay it even after March 2011. I could withdraw it after the central bank involvement .
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Re: "CIFL" IPO

Post by mark on Mon Jun 27, 2011 11:56 pm

@hettdas wrote:I don't think CIFL is a good company. I had a fixed deposit with them.They couldn't repay it even after March 2011. I could withdraw it after the central bank involvement .

oh.oh... thanks mate for your info,seems we have to analyse it to depth....will see their prospectus Suspect
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Re: "CIFL" IPO

Post by rijayasooriya on Tue Jun 28, 2011 12:06 am

@hettdas wrote:I don't think CIFL is a good company. I had a fixed deposit with them.They couldn't repay it even after March 2011. I could withdraw it after the central bank involvement .
Thanks and +rep from me.
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Re: "CIFL" IPO

Post by tkc on Tue Jun 28, 2011 6:01 am

@hettdas wrote:I don't think CIFL is a good company. I had a fixed deposit with them.They couldn't repay it even after March 2011. I could withdraw it after the central bank involvement .

Interesting! Have to study prospectus closely. And we should keep your experience in our minds.
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Re: "CIFL" IPO

Post by widanage on Tue Jun 28, 2011 6:41 am

@tkc wrote:
@hettdas wrote:I don't think CIFL is a good company. I had a fixed deposit with them.They couldn't repay it even after March 2011. I could withdraw it after the central bank involvement .

Interesting! Have to study prospectus closely. And we should keep your experience in our minds.


One of my relatives had a Rs 2.5 Mn FD with them it took almost three years after maturity to get it back in around 15 installments (Appa Kewa Wage). I also went once with my Uncle to their Bagatalle Rd Office (Now closed). I requested their financials and had a glance at it.

1. They have invested some real estate project in Homagama (as I remember) and got stuck with it.
2. It created a asset liability mismatch so they can not meet the obligations of maturing deposits
3. Further to that they have made avoidance tactics when we call or call over. But this was different when its about a new investment.

Whatever it is, its board and the management responsibility be prudent in their investments. They just followed the real estate bubble and got almost busted. In my opinion now they have a chance to raise the money form public behind the central bank regulations.

Its upto the investors (retail like us) to be prudent because its our blood and sweat.

For me it is CRAP and they are to be SCRAPPED.


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Re: "CIFL" IPO

Post by mark_fernando on Tue Jun 28, 2011 2:10 pm

I got a recommendation about this company through a friend....every company has positives & negatives..awaiting for their prospectus..


Last edited by mark on Wed Jun 29, 2011 10:40 am; edited 1 time in total (Reason for editing : edited accordingly)

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Re: "CIFL" IPO

Post by alexd on Tue Jun 28, 2011 7:47 pm

Based on CIFL's Annual report for the year 2009/10 (http://www.cifl.lk/downloads/ann_rep.html - page 2) EPS was Rs. 0.79 and NAPS was Rs.13.07 these figures seem better than the previous year which was Rs 0.13 and Rs 14.92 respectively (obtained from the same report). Performance figures seems promising together with their offer price of 10/- per share. Awaiting the issue of their prospectus.


Last edited by mark on Wed Jun 29, 2011 10:37 am; edited 1 time in total (Reason for editing : edited accordingly)

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Re: "CIFL" IPO

Post by widanage on Tue Jun 28, 2011 9:38 pm

@Financeguy wrote:Hey Guys there are many finance companies didnt pay their Depositers and had worst situations and larger portfolios came to Market and Become Sucessfull right, And guys made good money in Stocks like Nations Lanka isnt it? Why dont we wait for the Prospectus with out jumping the Gun...Hold Your Horses Guys...Smile

@mark_fernando wrote:I got a good recommendation about this company through a friend....every company has positives & negatives..awaiting for their prospectus..

@alexd wrote:Based on CIFL's Annual report for the year 2009/10 (http://www.cifl.lk/downloads/ann_rep.html - page 2) EPS was Rs. 0.79 and NAPS was Rs.13.07 these figures seem better than the previous year which was Rs 0.13 and Rs 14.92 respectively (obtained from the same report). Performance figures seem promising together with their offer price of 10/- per share. Awaiting the issue of their prospectus. I think it would be a good buy in terms of investment from the way the other finance companies have gained in share value upon their IPOs and listings.

Dear Friends

When you have first hand experience it supersedes perception, hunch, EPS, NAV and simply everything. I respect all three views above and any other future views on this. But when you know the smell of S*** you don't need to see it.

All my comments are based on their financials of 2008/09 & 2009/10 and not the latest. I may be wrong if the company had made a complete restructuring to their balance sheet.




1. There main source of funding is public deposits.(Note 17 - Let us see where they have put all these money)

2. Liquid assets has come down from 272Mn to 90Mn (Note 3,4,5)

3. Loan book (Leasing, HP & Loans) shrunk to 309 Mn from 490 Mn. (Note 7 & 8 - There are a finance company. There core business is lending but the loan book is mere 14% of there total shareholders funds and liabilities)
How do you justify the above actions. It is good for a real estate company not for a finance company. Directors should act prudently since they are playing with public money.

4. Investment in JV Company is 776 Mn (Note 14), which can go up to 800Mn. At the same time the interest receivable from JV is 418 Mn (Note 9). Just look at the ROI but not realized yet.

5. With all difficulties they have invested 190Mn (Note 13) Rajagiriya Project and the interest receivable from this included in Note 6 amounting to 22Mn.

I doubt that the balance sheet of the company belongs to finance company but investment or real estate company.

Finally this is CSE which has the real potential for CRAP, GARBAGE and S***. This will be oversubscribe for sure and I will not be surprised if this shoot up to Rs 107.60. As tubal says they are in search for dumb money. They need you....

If the BS of the company has a restructuring during the recent financial year I will hide my tail between the legs and subscribe.

-----------------------

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Re: "CIFL" IPO

Post by Financeguy on Tue Jun 28, 2011 10:30 pm

I somewhat agree with the comments of the real estate investment, But can't clearly see what are the assets belongs to this, realizability depends quality of the asset and the returns can be more than HP and leasing. And unlike the lease assets the capital gains are always there in trading real estate stock. But you are very right if the stock quality is bad, on another note the maturity mismatch can be higher if the real-estate asset is not moving in the market, how ever I would love to see the assets of this project so we can ascertain the realizability of their real estate portfolio.

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Re: "CIFL" IPO

Post by widanage on Wed Jun 29, 2011 6:16 am

@ Jason

Please read my second comment on the same thread and come up with the counter arguments for the assets on the balance sheet. It shows the BS of the company for 2008/09 and 2009/10. The major argument here based on the ASSET - LIABILITY mismatch which is the responsibility of the directors ultimately deprived poor depositors.

I have no personal issues with the company.In the last sentence of my statement I have a provision to hide my tail between my legs. So you have the opportunity to initiate it. Let's talk numbers.

Link to CIFL annual report

http://www.cifl.lk/downloads/applications/An_rp_1.pdf


Last edited by widanage on Wed Jun 29, 2011 6:47 am; edited 1 time in total (Reason for editing : Link included)

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Re: "CIFL" IPO

Post by Financeguy on Wed Jun 29, 2011 8:51 am

Hey Guys,

Is there a real asst liability mismatch? I really dont see it in the Balance sheet, In your 2nd comment you state that that Liquidity has comedown, but also you can notice for the entire year the companies total liability has increased only from 60 Million Rupees, this shows their public liability has not gone up for the year,

How ever can you explain how there is an asset Liability Mismatch??

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Re: "CIFL" IPO

Post by StocksWatch on Wed Jun 29, 2011 9:25 am

This thread and all comments look very strange to me. Few members who have joined the forum either today or yesterday are vigorously trying to defend a company which is going for an IPO shortly. Similar situation was there with Expo Lanka as well. We don’t see those who promoted Expo Lanka IPO anymore in this forum.

My advice to all readers, don’t repeat the mistakes you have done in the past, analyze the prospectus and all other available information about the company before you apply. Mainly do a valuation and see if the price of the IPO is attractive compared to other shares in the same sector, trading in the secondary market. It is your money, choose the right option carefully.
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Re: "CIFL" IPO

Post by mark_fernando on Wed Jun 29, 2011 12:45 pm

To Stock Watch,

Yes I agree with you 100%, But on a another view do you expect people to stay silent, when a person comments, to scrap a registerd finance companny with baseless aligations just before it's IPO, its good to analyse and educate and comment on a IPO but sad to see people vigorously trying to tarnish a companies image for their personal openion on a respected blog like this.


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Re: "CIFL" IPO

Post by alexd on Tue Jul 05, 2011 12:58 pm

With reference to

@mark wrote:why so hurry.....wait wait........
as i know still prospectus is pending,good that you interested in IPO's,but nowadays most are slops bcoz of unethical practices in PP....

@mark_fernando wrote:I got a recommendation about this company through a friend....every company has positives & negatives..awaiting for their prospectus..

and my earlier comment

@alexd wrote:Based on CIFL's Annual report for the year 2009/10 (http://www.cifl.lk/downloads/ann_rep.html - page 2) EPS was Rs. 0.79 and NAPS was Rs.13.07 these figures seem better than the previous year which was Rs 0.13 and Rs 14.92 respectively (obtained from the same report). Performance figures seems promising together with their offer price of 10/- per share. Awaiting the issue of their prospectus.

CIFL prospectus is available on the CSE website as of today (refer - www.cse.lk) - FYI

The EPS and NAPS for 9 months ending 31st Dec 2010 has been included in the prospectus and is Rs 0.99 and Rs 14.86 respectively. Would appreciate some expert comments on CIFL's IPO.

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Be aware-CIFL split before IPO

Post by PGCR on Tue Jul 05, 2011 5:00 pm

CIFL Audited financial statement shows EPS of 0.99 for the year ended 31st December 2010. As at 31st December 2010, there were only 19,739,424 shares outstanding as at that date. Subsequently CIFL Has done a Split (11 for 5 ) on 9th May 2011 & the new share capital represents 43,426,733. Then the EPS figure get diluted up to Rs 0.45.

Further, prospectus pages No 11 states that “If IPO fully subscribed, the offered Shares will amount to 47.95 % of the Issued Ordinary Shares of the Company subsequent to the Offering.”

Then, After IPO, No of shares issued will be 83,420,229. After IPO EPS (based on current audited accounts) will be only Rs 0.23. Which is at 43 X (times) P/E to its IPO price.

Over to you my friends…


Last edited by mark on Tue Jul 05, 2011 6:16 pm; edited 1 time in total (Reason for editing : topic changed)

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Re: "CIFL" IPO

Post by ruwan49 on Tue Jul 05, 2011 9:06 pm

Thanks PGCR,,Valuable Advice
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Re: "CIFL" IPO

Post by Chinwi on Wed Jul 06, 2011 9:45 pm

Thanks for alarming us.

Now, I want to know about the Shareholders list published in the prospectus.

There are 220 pre -IPO shareholders in Annexure F.

The number of shares each of them hold are very unusual.
396, 1558, 1041, 176, 5852 , 14555, ..... ???

Why is this. ?
I heard some badly managed finance companies converted their debt to shares and forcefully gave them to the depositors.

If any of our members know any of these shareholders please find out and let us know. The names and addresses are given in pages 138 to 141






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Re: "CIFL" IPO

Post by Slstock on Thu Jul 07, 2011 2:27 am

@PGCR wrote:CIFL Audited financial statement shows EPS of 0.99 for the year ended 31st December 2010. As at 31st December 2010, there were only 19,739,424 shares outstanding as at that date. Subsequently CIFL Has done a Split (11 for 5 ) on 9th May 2011 & the new share capital represents 43,426,733. Then the EPS figure get diluted up to Rs 0.45.

Further, prospectus pages No 11 states that “If IPO fully subscribed, the offered Shares will amount to 47.95 % of the Issued Ordinary Shares of the Company subsequent to the Offering.”

Then, After IPO, No of shares issued will be 83,420,229. After IPO EPS (based on current audited accounts) will be only Rs 0.23. Which is at 43 X (times) P/E to its IPO price.

Over to you my friends…


THanks for uncovering the hidden numbers. We need to be careful before buying with all these new companies getting listed one after the other.
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Re: "CIFL" IPO

Post by wgsaman on Thu Jul 07, 2011 7:53 am

thanx for your ideas
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Re: "CIFL" IPO

Post by Chinwi on Thu Jul 07, 2011 8:17 am

Sorry I posted this in other thread , re-post here.


As per the prospectus, there are 220 pre -IPO shareholders in Annexure F.

The number of shares each of them hold are very unusual.
396, 1558, 1041, 176, 5852 , 14555, ..... ???

Why is this. ?
I heard some badly managed finance companies converted their debt to shares and forcefully gave them to the depositors.

If any of our members know any of these shareholders please find out and let us know. The names and addresses are given in pages 138 to 141

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Re: "CIFL" IPO

Post by mark_fernando on Thu Jul 07, 2011 3:16 pm

I think there is a mistake in the way PGCR has calculated PE
Ratio.According to my knowledge we have to take the IPO proceeds to
calculate forward PE.

Let me explain you how to derive PE based on my knowledge :-).There
are two types of PE ratios.Lets look at Trailing PE based on the past
data.First we should divide last year net profit by No of shares
issued before the IPO.In this case its (26,087,554 / 43,426,733)
=Rs.0.60.So the trailing PE is (10/0.60) =16.65x .The net profit
figure i have taken is for the Financial year ended 31st March 2011
out of which nine months are Audited.

To calculate future EPS we should search for their FY12 bottom line
and divide it by Post IPO no of shares issued (83,426,733).I think we
cannot use post IPO shares issued without considering the IPO proceeds
to the calculation.

Anyway I do not know much about the Company, want more time to go
through figures and prospectus.But i can clearly see some people
trying to mislead investors by putting wrong calculation and giving
wrong picture about the Company.After going through this calculation
I realized it.Dear investors pls do your calculations properly then
decide what to do!!!

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Re: "CIFL" IPO

Post by factFINDER on Thu Jul 07, 2011 7:55 pm

@Chinwi wrote:Thanks for alarming us.

Now, I want to know about the Shareholders list published in the prospectus.

There are 220 pre -IPO shareholders in Annexure F.

The number of shares each of them hold are very unusual.
396, 1558, 1041, 176, 5852 , 14555, ..... ???

Why is this. ?
I heard some badly managed finance companies converted their debt to shares and forcefully gave them to the depositors.

If any of our members know any of these shareholders please find out and let us know. The names and addresses are given in pages 138 to 141


I guess these odd numbers came becouse of their share split of 5 in to 11 done in May 2011!!
e.g.
If there was 1000 shares prior to the splitting it becomes 2200.
If it was 100 > 220., ...440, 660, 880 ... 5500.. like wise.

Also ... what you said may be correct as odd number of shares has been issued far before the splitting (specially in November 2006). But even that year the company has made a profit and hardly assumed that they have forcefully converted debt/deposits in to shares.

But, shares issued in 2008/2009 are result of Bonus issue (page 49)


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Re: "CIFL" IPO

Post by MoneyLover on Thu Jul 07, 2011 10:47 pm

@alexd wrote:With reference to

@mark wrote:why so hurry.....wait wait........
as i know still prospectus is pending,good that you interested in IPO's,but nowadays most are slops bcoz of unethical practices in PP....

@mark_fernando wrote:I got a recommendation about this company through a friend....every company has positives & negatives..awaiting for their prospectus..

and my earlier comment

@alexd wrote:Based on CIFL's Annual report for the year 2009/10 (http://www.cifl.lk/downloads/ann_rep.html - page 2) EPS was Rs. 0.79 and NAPS was Rs.13.07 these figures seem better than the previous year which was Rs 0.13 and Rs 14.92 respectively (obtained from the same report). Performance figures seems promising together with their offer price of 10/- per share. Awaiting the issue of their prospectus.

CIFL prospectus is available on the CSE website as of today (refer - www.cse.lk) - FYI

The EPS and NAPS for 9 months ending 31st Dec 2010 has been included in the prospectus and is Rs 0.99 and Rs 14.86 respectively. Would appreciate some expert comments on CIFL's IPO.

Dear alexd,

Appriciate if you would show us the NAPS and EPS after 5 to 11 splitting done in May 2011?? Without showing the adjusted statistics your attempt to paint CIFL is incomplete and misleading .....

Before 5 to 11 splitting NAPS (as at 31/12/2010) was 14.86
After 5 to 11 splitting = 14.86 X 5 / 11 = NAPS only 6.75 and P/BV = 1.48

Before 5 to 11 splitting ESP (9 month up to 31/12/2010) is 0.99
After 5 to 11 splitting ESP?? .......


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