STARS CUTS IPO PRICE AHEAD OF SET DEBUT

       Star Microelectronics yesterday set its IPO price at Bt4.95 per share, for a 25-30-per-cent discount from the prospective price.
       "The share price should stay above the subscription price when the company starts trading on September 24, due mainly to signs of recovery in the electronics parts industry," SMT chairman Somnuk Chaikul said yesterday.
       SMT also promised to pay an interim dividend of Bt0.14 to all investors subscribing to the 92 million initial public offering shares from tomorrow to Friday.
       The IPO should receive a warm welcome, following satisfactory results in book building, he said.
       Prospective investors were impressed with the company's average 65-per-cent growth in net profit in the past four years, he said.
       To maintain that pace, SMT plans to expand its integrated circuit manufacturing capacity with an investment of Bt150 million for this and next year.
       The project would be financed out of internal cashflow, as the proceeds from the IPO will be used to refinance its debts, which would bring the company's debt-to-equity ratio down from 1.1 to 0.5.
       SMT expects profits to rise 20 per cent this year, from Bt201 million last year, due to orders returning particularly for ICs, which carry a 40-per-cent profit margin.
       Though the margin for the microelectronics module assembly business is declining to about 10 per cent, the company still expects annual revenue to stay at last year's level of Bt12 billion.
       "The net profit margin this year should increase to 6-7 per cent, from 5-6 per cent last year, as the company focuses on high-margin products and cost management," Somnuk said.
       Paiboon Nalinthrangkurn, CEO of Tisco Securities, the deal's underwriter, also expects the growth story to continue for the company, when new high-margin products hit the market later this year.
       The IPO price represents a price-to-earnings ratio of 7, compared to 8-10 of companies listed in the same sector of the Stock Exchange of Thailand, he said.