Here’s one com­pany that plans to list

Finweek English Edition - - Private Buy - SHAUN HAR­RIS shaunh@fin­week.co.za And on the bat­tered AltX

QUICK PICKS HAVE been hard to come by re­cently. There’s been a wel­come re­vival on the JSE, but mainly in sec­tors and shares al­ready cov­ered in this col­umn. So this week I’m cast­ing into the fu­ture to try and catch what could be an up-and-com­ing quick pic when it lists on the JSE, pos­si­bly be­fore year-end 2009.

The com­pany is called Just On Cos­met­ics. I’m out of my depth at the start be­cause, first, it will be a small cap and, sec­ond, its list­ing is planned for the AltX. Those are both ar­eas far bet­ter cov­ered by col­league Marc Hasen­fuss.

What caught my at­ten­tion were the three busi­ness­men back­ing Just On Cos­met­ics. Trevor Ed­wards, Stan Whit­field and Eric Parker all have long his­to­ries as en­trepreneurs. The first two, among other ven­tures, founded and de­vel­oped the for­mer Enaleni Phar­ma­ceu­ti­cals be­fore it be­came Ci­pla Med­pro. Along with them, Parker is one of the founders of Nando’s.

The three have taken a 10% share­hold­ing in Just On Cos­met­ics, con­di­tional on it list­ing on the AltX later this year. Why do they like the com­pany?

“It’s an empowerment re­tailer poised for enor­mous growth to meet the de­mands of an ever-grow­ing con­sumer mar­ket, both ur­ban and ru­ral, with am­bi­tious plans to in­crease its foot­print through­out South Africa and with long-term plans of even­tu­ally spread­ing through­out Africa,” says Ed­wards. Once listed, he says he’ll serve as Just On Cos­met­ics’ non-ex­ec­u­tive chair­man. Whit­field and Parker will be non-ex­ec­u­tive direc­tors.

The com­pany cur­rently has 27 stores, mainly in the East­ern Cape but also in KwaZulu-Natal and the Free State. Founder Mike Naidoo says it cur­rently serves close to 14m cus­tomers a year but plans to ex­pand ag­gres­sively.

But isn’t this a tough time for any re­tail busi­ness, es­pe­cially one where fi­nan­cially hard-pressed con­sumers can ditch nonessen­tials such as cos­met­ics? I did men­tion that to some of the women who al­low me to share my house with them and was given a ver­bal kick in the teeth and re­minder that cos­met­ics aren’t “non-es­sen­tial”.

Any­way, Just On Cos­met­ics ar­gu­ment is that it fo­cuses on the niche health, beauty and house­hold mar­ket. It claims that’s a large and grow­ing sec­tor with an es­ti­mated turnover of R15bn/year and is a mar­ket grow­ing ahead of inflation. Its cus­tomers fall into the LSM 4-7 in­come groups, it says.

That’s the story. I’ll make a fi­nal in­vest­ment de­ci­sion when I see its prospec­tus. But po­ten­tial in­vestors might want to put it on the radar screen.

Pills, chick­ens, now cos­met­ics. Trevor Ed­wards

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