Nasdaq dreams aside, LYC must first focus on profitability

AFTER abandoning its plans to list its Singapore units on the Catalist board, LYC Healthcare Bhd has now set its sights on the Nasdaq Capital Markets.

The ACE-Market listed firm owns 64.5% of its Singaporean assets that are being floated on the Nasdaq Capital Markets.

These assets are involved in orthopedic surgery, clinical care, chronic degenerative joint management, and other chronic disease management. The company operates five clinics in Singapore and aims to become a one-stop provider of musculoskeletal-related medical care.

At the onset, one needs to understand that the Nasdaq Capital Markets is the tiniest of the three bourses under the Nasdaq umbrella.

While Nasdaq generally refers to the Nasdaq Stock Market itself, which is home to many promising technology and other types of companies, the Nasdaq Capital Market is a third-tier exchange catering to smaller companies that may not meet the requirements of the other two tiers, but still meet certain listing standards.

Furthermore, it is well-known that a small Malaysian, or in this case, Singaporean entity seeking to list on any foreign market, let alone the US stock market, typically hardly gets any serious attention from investors there.

They are looking for the next breakthrough technology from the many startups in their own country.

This is why, the few Asian companies that do get listed on any foreign markets, whether on the Nasdaq bourses or Australia’s ASX, often fail to attract significant investor interest.

Nevertheless, the LYC entity being listed is selling only new shares and plans to raise between US$5mil and US$15mil for growth capital. The rationale for the listing is to raise the profile of LYC’s Singapore unit and, of course, to raise capital both now and in the future.

LYC has been loss-making since going into the healthcare business after businessman Lim Yin Chow first emerged in the company in 2016, when it was known as Mexter Technology Bhd. LYC says the proposed Nasdaq listing exercise will enable the group to unlock the value of its investment in its operating subsidiaries.

Be that as it may, LYC will still need to steer itself toward profitability in order for it to capture the attention of investors here.