sbb today, page-69

Again the issue is lack of concrete information from the horse's mouth however what I can only internalise reasons being:

Pandist products are currently upper middle class priced - Often twice the price of Septwolves on similar products. You can imagine the production and distribution cost should not be all that different and it's really just the brand perception (and maybe quality?) that makes up the rest. I'm not saying Pandist is a better brand, but rather the target segment is narrower and at the higher end of middle class, one possible explanation of the margins.

The lack of internet sales is possibly also a reason but again just speculating here. Let's make an assumption that the price offered to resellers are the same across the broad, other things being equal internet sale will push down the price (due to lower operating cost) and eat into the margin of brick and motar shops which forms the majority of Pandist clients. However the CEO did mention they are thinking about expanding into the Internet, how to balance this vs their traditional distribution network will be the challenge as you don't want to alienate your bread winners for the past couple years.

I'd say Pandist volumne is less than 1/10 of the more famous brands and you will only expect overall margin to be lower the bigger the share of the market as price competition comes into the equation. Margin is maintained from 2 areas, production and distribution. And as Pandist expands, it is foreseeable the margin will also decrease but as long as sales growth offsets that reduction it is not a problem.

Which is why marketing (both to the end customer as well as franchisees) is the main game for this company. It has been around the local area for many years and brand awareness should be there, but if expanding into new areas, which is inevitable if you want to get to the numbers mentioned in the IPO, how to induce purchase with the higher price if the brand itself is not well known?

Interest income I have no answer for and is a risk that you just have to consider on whether to take a punt. Not kidding myself which part of the market this company sits in with current information.