CTOS Digital Bhd closed its initial public offering (IPO) debut at RM1.62, which is 47% above its IPO price of RM 1.10. Considering the weak market sentiment amidst raging Covid-19 cases in the region and political uncertainty, I would say the IPO was a huge success.
In addition, we must note that the CTOS IPO offering was on the higher end of the valuation (45 times the price earnings ratio or PER). At today’s market price, it is trading at 68 times the forward PER. Calculated simplistically, it is expensive by any metrics.
However, what matters isn’t just the PER valuation of the business. There are certain qualitative factors to consider.
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