NEW IPO

SESDAQ debutant Gallant Venture yesterday shocked the market by opening the day's trading 40 per cent below its 50 cent issue price - regarded as one of the worst openings for an initial public offering (IPO) in years.

However, the stock managed to redeem itself somewhat when it finally ended the day up at 52 cents.

But most dealers said that Gallant's close was unconvincing, as it had traded at way below the issue price until about 15 minutes before market closing when the price shot past 50 cents.

While many dealers attributed Gallant's lacklustre debut to the recent market turmoil which has made investors wary about IPOs, some believe that the lack of a "sexy" story was also behind Gallant's failure to attract trading interest yesterday.

"Gallant's main businesses are mostly in the Indonesian islands of Bintan and Batam. And the type of businesses it runs, industrial parks and resorts, are not the type of proposition to excite investors," said a dealer.

Also, compared with other recent IPOs which were priced at an affordable 20 to 30 cent price range, Gallant's whopping issue price of 50 cents puts it out of reach for most punters, he added.

"Gallant's eye-popping historic price-earnings ratio of 94 times also makes investors wary of the stock. Investors are spoilt for choices after the recent market carnage," the dealer added.