Ron Sim's V3, which owns OSIM, files for Hong Kong IPO
Move comes as group posts surge in profit for 9 months ended Sep 30, 2021
Singapore
V3 GROUP, which owns brands such as OSIM and TWG Tea, has filed for an initial public offering (IPO) on the main board of The Stock Exchange of Hong Kong (SEHK).
V3 Brands Asia, an investment holding company wholly-owned by V3 Group - made an application to the Hong Kong Exchange for a global offering on Monday (Feb 28).
The application proof redacted pricing details, the size of the offering and the number of shares up for grabs.
The move comes as the lifestyle products group posted a surge in profit for the 9 months ended Sep 30, 2021. Profit after tax for the period stood at S$72.7 million, 2.5 times the S$28.7 million recorded in the 9 months ended Sep 30, 2020. Revenue was up 32.8 per cent to S$332.8 million, from S$250.6 million in the year-ago period.
For the full year ended Dec 31, 2020, revenue was 15.6 per cent higher year on year at S$377.8 million, from S$326.9 million in FY2019. Profit after tax stood at S$43.4 million, 58.9 per cent higher than S$27.3 million in the year-ago period.
V3's higher revenue during the 2 years ended Dec 31, 2020, and 9 months ended Sep 30, 2021, was attributed to higher sales as a result of increased consumer demand for lifestyle and wellness products; targeted marketing and sales activities; and the success of blockbuster products.
The group owns the OSIM brand - known for its massage chairs and relaxation products; luxury tea brand TWG Tea; nutritional supplement retailer ONI Global; and Futuristic - a Singapore-headquartered manufacturer of store fixtures.
Founded by Ron Sim, the group opened its first store in Singapore in 1983 and later in Hong Kong in 1986. It also expanded to Taiwan and Malaysia before officially launching the OSIM brand name in 1993 and expanding to China.
OSIM listed on the Singapore Exchange in 2000, but delisted in 2016.
Fast forward to today, the Greater China market - which includes Hong Kong - comprises 271 out of 338 of the group's own stores worldwide. By comparison, there are 22 stories in Singapore and 45 in Malaysia, as at Sep 30, 2021.
In terms of revenue, the Greater China area raked in 55.7 per cent or S$185.4 million in the 9 months ended Sep 30, 2021.
A majority of net proceeds from the offering will be used to repay existing syndicate loans with a drawn-down amount of S$196.6 million.
This includes digitalisation initiatives, enhancing V3's mechanical engineering technology, marketing activities, expanding its store network and refurbishing existing stores, as well as "strategic alliances or acquisitions" to diversify V3's product portfolio. The rest will be used for general corporate purposes and funding working capital needs.
