The long-awaited Thailand Future Fund (TFFIF) will launch an IPO tomorrow, offering retail investors 4-4.47 billion investment units at a price of 10 baht per unit.
The subscription period runs Oct 12-19, and the minimum investment subscription is set at 1,000 units, with no limit capped on investment units per one subscription certificate.
Interested investors can obtain the prospectus and subscription certificates and subscribe to TFFIF investment units at the headquarters and branches of Krungthai Bank, Bangkok Bank, Finansa Securities, Phatra Securities, Krungthai Asset Management and MFC Asset Management.
The TFFIF has received approval from the Securities and Exchange Commission for its first capital increase after the fund's financial advisers and underwriters submitted the fund's prospectus and IPO filing, said Anuwat Ruamsuke, managing director of Phatra Securities.
Retail investors who subscribe to the TFFIF's IPO units will get rights to the first allotment for a 10,000-baht investment, a move meant to offer the fund to as many individual investors as possible.
The fund's first-year return is projected in a range of 4.75-5.3%, which is expected to lure investors because the underlying assets are government projects deemed to carry lower risk than other infrastructure investments.
Chavinda Hanratanakool, chief executive of Krungthai Asset Management, said the TFFIF has a policy to make dividend payments twice a year, provided that the fund generates sufficient profits.
Dividend payment for first-year unit holders at the end of September 2019 is 4.75-5.3%, Mrs Chavinda said.
For each fiscal year, the TFFIF will pay no less than 90% of adjusted net income, she said.
A cabinet resolution called for 45% of future revenue from the Chalong Rat Expressway and Burapha Withi Expressway, both owned by the Expressway Authority of Thailand (Exat), to be used to back TFFIF's first batch of units.
Proceeds from the fund's IPO will be used to finance construction of the expressway linking Rama III Road-Dao Khanong and the Western Outer Ring Road, worth 30.4 billion baht, as well as the third stage of the long-delayed northern expressway linking the Kasetsart intersection and Nawamin Road, also known as the N2 section, worth 14.4 billion baht.
The TFFIF is expected to receive 2.2 billion baht in revenue from both expressways next year, according to Charnwit Nakburi, deputy director-general of the State Enterprise Policy Office.
The expressways have a combined length of 83.2km and revenue is expected to continue rising because they are core roads linked with the Eastern Economic Corridor.
From September 2015 to September 2017, the two expressways had average combined traffic of 369,464 car units a day, according to Exat.
Total revenue for both expressways was 4.67 billion baht for fiscal 2017 and 3.59 billion for the first nine months of fiscal 2018 to June.
