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Toh Han Shih

Ports Design, a fashion firm focusing on China with investments from the Singapore government, plans to list in Hong Kong this year, according to managing director Alfred Chan.

The Government of Singapore Investment Corp (GIC) owns a substantial minority stake in Ports Design, while Mr Chan's family owns more than half of the Hong Kong-based company. CFS, a Canadian-listed investment holding company, also owns a stake.

Mr Chan said one reason for the listing was to give shareholders liquidity on their investments.

The initial public offering will raise  $300 million to $400 million, according to market sources.

Ports Design had begun the application process for a Hong Kong listing, Mr Chan said. He said the company was 'more than qualified to list on the main board', given its track record of profitability.

The company's gross profit margin has grown from 51 per cent in 1999 to 54 per cent in 2000, 58 per cent in 2001 and 62 per cent last year. Mr Chan attributed the growth to economies of scale.

Its China business realised a profit of five million yuan (HK$4.69 million) on turnover of 50 million yuan in 1994, and a 92 million yuan profit on turnover of 470 million yuan last year. China accounts for more than 95 per cent of its  business and Mr Chan said the firm had no plans to expand in other countries for the next two years.

Excluding  the period from March to May, when year-on-year sales growth slowed to 3 per cent due to Sars, Mr Chan said  revenue grew  18 to 20 per cent per year. Its return on equity had been about 40 per cent in the past few years.

Ports Design has  250 retail outlets in more than 50 mainland cities and four  Hong Kong stores. It employs about 2,800 people on the mainland, including 1,300 in its manufacturing plant in Xiamen. It  plans to increase the  number of retail outlets in China at a rate of 10 per cent a year, he said.

Its stores carry the Ports International clothing brand and that of German carmaker BMW.

On the mainland, its products sell at an average price of 3,000 yuan - two to three months' salary for many Chinese workers - but Mr Chan said it was not short of customers.



Fashion firm seeks liquidity in listing