Pawnbroker Maxi-Cash Financial Services Corporation Ltd launch its initial public offering (IPO) today, offering 56 million new shares at 30 cents apiece for a Catalist listing. … and estimated $15.1 million in net proceeds will help business growth, fund the company’s operations and create brand recognition and trust.

The largest pawnshop chain here has 24 outlets islandwide.

The IPO will close on June 20, and trading of shares is expected to begin on June 22.

(Source: Maxi-Cash IPO priced at 30 cents a share; First pawnbroker to seek an IPO in Singapore, Business Times Singapore, 13 June 2012)

Shares in pawnbroker Maxi-Cash Financial Services Corporation, surged as much as a third in its first day of trading on Catalyst yesterday.

The stock opened at S$0.35 compared to its IPO price of S$0.30.  It then closed the day at 39 cents, up 30% from its IPO price.

(Source: Maxi-Cash shares surge in trading debut; Stock of pawnbroker closes 30% up with 85 million shares totaling $32 million changing hands,  Business Times Singapore,  23 June 2012)

Required:

a)         Determine the amount of capital raised for this IPO.   

b)        If you were successful in subscribing to this IPO and paid for 100,000 shares in this IPO. How much is your capital gain on 22 June if you were to sell your 100,000 shares? (use the closing market price of $0.39)

Answer rating: 100% (QA)

a Number of shares issued is 56 million shares The IPO ... View the full answer