Premium watch distributor Sincere Watch (Hong Kong), hoping to raise up to $120.36 million from a share offering, plans to use half of the proceeds to expand its business in China.
Director Soh Gim Teik yesterday said although mainland sales taxes on luxury goods could be as high as 30 per cent, he was confident customers would pay for premium brand-name watches even though they could get a better deal in tax-free markets such as Hong Kong.
'There is always a market for brand products in China, but I believe that the current high sales tax on fine watches will gradually come down,' Mr Soh said.
Sincere Watch (Hong Kong) is being spun off from Singapore-listed Sincere Watch, which will hold 75 per cent of the company after listing.
An exclusive distributor of Swiss-made Franck Muller watches in Greater China and Thailand, Sincere Watch will issue 102 million new shares at an indicative price range of 90 cents to $1.18 each.
The initial public offering begins today and closes on October 5. Trading on the main board is scheduled for October 17.
