E-cigarette firm cashes in on vaping boom with stock market listing

One of Britain’s biggest makers of liquids for e-cigarettes is aiming to cash in on the boom in vaping by listing its shares on the London stock market.

Manchester-based Supreme, which is 100% owned by its chief executive Sandy Chadha, is expected to have a market value of £150m when it floats on Aim, the London Stock Exchange’s junior market, in mid- to late May.

The float will raise £10m, which will be used to expand its factory in Manchester and pay down debt. Supreme is the first UK vaping company to go public.

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Supreme owns the KiK and 88vape brands and makes more than 130,000 bottles of vaping e-liquids a day. It also sells hardware kits and vaping accessories, along with lightbulbs and 200m batteries in the past year.

The firm supplies retailers such as Asda, Halfords, B&M, Poundland, Iceland, Home Bargains and wholesalers such as Booker, Bestway, Costcutter and Nisa.

Supreme made revenues of £70.7m in the past year and earnings before interest and tax of £7.2m in the year to the end of March.

The business was set up by Chadha’s father in 1975 after the family moved to Britain from Delhi when he was two years old. His father started selling toys and other products imported from east Asia from a van and later moved into batteries.

Chadha, a millionaire, recently honoured a 10-year bet by handing over a £130,000 Bentley to corporate turnaround expert Iain Johnston. In 2007, Supreme went bust but Johnston, an adviser to Chadha’s lenders, confidently predicted the firm would recover.

He asked Chadha to bet his Bentley on the Supreme’s recovery, and the businessman pledged to hand over the luxury car if the firm made an annual profit of £1m. The two men lost contact, but after hunting him down on LinkedIn, Chadha handed over a Bentley Flying Spur to Johnston in January.

Nearly 3 million Britons are now vaping. UK sales of vaping products surged by 50% last year to reach £1bn, and are on course to exceed £2bn by 2020.

The latest evidence suggests that while e-cigarettes are not harmless, they are safer than smoking because they don’t contain tobacco. 2017 saw the publication of the first longer term study of vaping. Another study suggested a cancer risk from vaping of about 1% of that from smoking.

Chadha said: “Over the last two decades we have established Supreme as a leading manufacturer and distributor of batteries and lighting, and more recently vaping, demonstrating our ability to leverage our extensive distributor and customer relationships to drive growth.”