Heng Leasing prepares IPO share price of B1.95

Heng Leasing and Capital Plc, a consumer loan firm, has set an initial public offering (IPO) share price of 1.95 baht, aiming to raise more than 1.56 billion baht for business expansion the next few years.

The Securities and Exchange Commission approved the company’s filing yesterday to list on the Stock Exchange of Thailand.

Heng Leasing plans to offer at least 800.84 million IPO shares priced at 1.95 baht a share, accounting for more than 1.56 billion baht.

The share subscription period is Oct 6-8 this year, with trade on the local bourse scheduled to begin Oct 19.

Chief executive Sutharntip Phisitbuntoon said the proceeds will be used for repaying existing debt, IT investment and business expansion in short to medium term.

The company aims to increase total outstanding loans from 8.4 billion baht as of June this year to 14.8 billion by 2023, a 28% growth rate per year for the next two years.

Heng Leasing, a joint venture company of four northern auto leasing firms, plans to expand its branch network, which is mostly located in northern Thailand, from 451 to 830 outlets nationwide in 2023.

The company plans to use 70-90 million baht of the funds raised for IT investment in preparation to offer digital loan service next year, she said.

Mrs Sutharntip said auto leasing represents 65% of the company’s total loan portfolio, followed by car title loans at 27%.

Heng Leasing plans to increase the car title loan proportion to 48% and reduce auto leasing to 37% by 2023 to generate a better yield and higher income.

With business expansion plan and the higher proportion of car title loans, the company aims to generate better income and profitability.

The company estimates net profit bottomed out in the second quarter this year and trends show it is picking up, she said.

Heng Leasing recorded net profit of 109 million baht in the second quarter this year, down 36.3% yearon-year, attributed to lower income because of the pandemic.