EFORL’s Capital Increase Is to Cover Up the Debt!?

It looks like E For L Aim Public Company Limited (EFORL) is drawing another breath by announcing a capital increase by issuing 8,054,212,998 ordinary shares worth 402 million baht (4 existing shares : 1 newly issued share) with the offering price at ฿0.05/share, proposing to its shareholders.

 

Objectives of the capital increase has been stated in the report,saying that EFORL will use it to repay loan from financial institution approximately 200 million baht and the remaining 202 million baht will be used as working capital.

EFORL’s core business focuses on distributing medical devices and equipment while owning Wuttisak Clinic Inter Group Co. Ltd., who operates beauty clinics, for business synergy. From the business outlook, Investors had hoped that EFORL would have a bright future along with a wonderful profit.

But in reality, the business of Wuttisak Clinic starts to decline while the popularity in its brand is starting to fade away. To make things worse, there are also some unclarities of selling its assets, which is Wuttisak Clinic’s branches.

EFORL has been in a crumbling state since then.

 

EFORL once tried to revive its business by having Mr. Wichai Thongtang as a major shareholders for a change in management structure, but the coming of new major shareholders did not do anything much. In the past three years, there are not any “profit” shown in the financial statement.

In 2016, EFORL recorded a revenue at 3,754 million baht, net loss 614 million baht and net profit -16.37%. In 2017, EFORL recorded a revenue at 2,509 million baht, net loss 1,163 million baht and net profit -46.34%. In 2018, the company recorded a revenue at 2,398 million baht, net loss 166 million baht and net profit -6.93%.

In the first half of 2019, EFORL recorded a revenue at 992 million baht, net loss 36 million baht and net profit -63% while the amount of debt was 2,771 million baht which was almost at the level of its assets of 3,132 million baht along with a total of 1,836 million baht deficit, making it close to business rehabilitation.

Which is why the capital increase will not only relieve EFORL from its debt and solve its liquidity problem, it will also rescue EFORL from going to rehabilitation or bankruptcy.

All 15,423 individual shareholders must feel relieved after hearing this.

 

As of now, EFORL has set its target to grow 15% YoY, trying to recover Wuttisak Clinic’s outlook by developing the business to Beauty Living as an all rounded beauty clinic.

The debut of EFORL’s turn around is to open “Wuttisak Beauty Station” as a popup shop at BTS Ratchadamri to sell its products and beauty services such as eyelash extensions, pedicure and facial treatment.

It is expected that the business will make 1,000 million baht of revenue in three years, expecting an expansion by 4-5 branches domestically next year.

Whoever has EFORL in their portfolio might have a chance to……