IPO Details

• Listing date: 9 June 2025 at RM 0.16 IPO price,

  • Target price: RM 0.20

  • IPO oversubscribed by 5.33× (196.2 M units applied for 31 M offered).

  • Bumiputera public: 2.94×, Other Malaysian public: 7.72×.

    ---

   

• Purpose of IPO:

  • Total funds raised: RM 19.34 M via new shares and RM 12.40 M from existing shareholders (offer-for-sale).

    • RM 3.00 M (15.5%) – purchase of machinery and IT.

    • RM 10.49 M (54.2%) – working capital for ongoing projects.

    • RM 2.10 M (10.9%) – repay borrowings.

    • RM 3.75 M (19.4%) – listing expenses.

  • Indicates a growth-driven IPO with targeted operational enhancements and expansion.

• Oversubscription:

  • IPO oversubscribed by 5.33× (196.2 M units applied for 31 M offered).

  • Bumiputera public: 2.94×, Other Malaysian public: 7.72×.

• Dividend Commitment:

  • The company targets a dividend payout ratio of 30% of PAT.

  • Paid RM 1,000 in FYE 2024 and RM 4,000 up to latest practicable date (LPD).

IPO Placement & Share Information

• Total shares offered: 198.4 M (120.9 M new, 77.5 M existing).

• Total enlarged shares post-IPO: 620 M.

• Implied market cap: RM 99.2 M (at RM 0.16 IPO price).

• Based on the oversubscription rate, institutional placements, and limited float, the IPO is likely to perform well on Day 1.

 Institutional & Anchor Investors

• Private placement:

  • 71.3 M to selected investors.

  • 77.5 M to Bumiputera investors approved by MITI.

  • 515 investors subscribed for 113.94 M shares.

• No institutional investors were reported to have exited or sold shares before listing.

• Given strong demand and wide placement spread, the IPO shows healthy institutional backing and control.

Investment Banker, Underwriter & Sponsor

• Principal Adviser, Sponsor, Sole Underwriter: TA Securities Holdings Berhad.

• A known underwriter with consistent track record, which adds credibility and increases the probability of first-day success.

Company Overview

Business Model & Industry

• Sarawak-based building and infrastructure contractor.

• As of April 2025, order book of RM 142.5 M, equal to ~112% of FY2024 revenue.

• Industry outlook supported by Sarawak’s RM 10.9 B state development budget.

Financial Health

• Revenue:

  • FY2021: RM 34.07 M

  • FY2022: RM 60.12 M

  • FY2023: RM 96.58 M

  • FY2024: RM 127.59 M

• PAT:

  • FY2021: RM 4.8 M

  • FY2024: RM 9.2 M

• GP margin FY2024: 68.8%

• PAT margin FY2024: 19.3%

• Gearing: 0.73×

• Cash: RM 5.73 M

• Current ratio: ~1.3×

Market Position

• Completed 33 projects worth RM 146.5 M since 2010.

• Market share:

  • ~3.7% in non-residential building.

  • ~0.4% in civil engineering (Sarawak).

Management Team

• Seah Boon Tiat – MD, promoter (20.45%)

• Seah Boon Kee – Deputy MD (15.06%)

• Tony Cheok Liam Fock – COO (15.06%)

• Peter Chai Mui Seng – Substantial shareholder (16.31%)

Market Conditions & Trends

a) Sector, Regional, and Global Trends

• Sarawak construction sector expected to grow at 2.3% CAGR (2021–2025).

• RM 1 B allocated to roads/bridges under the state budget.

b) Timing of IPO

• Listing date: 9 June 2025

• Aligns with upcoming state infrastructure investments.

c) Economic Environment

• Government-led infrastructure stimulus is favourable for regional contractors.

d) News & Developments

• 5.33× oversubscription reflects strong investor confidence.

e) Market Sentiment

• Well-timed issue + high demand + strategic regional focus = favourable listing environment.

f) Prospectus Analysis

• Strong focus on tendering, expanding project capacity, and acquiring machinery.

g) Risk Factors

• Client concentration, Sarawak-focused, tender dependency, and execution risks disclosed.

h) Growth Strategy

• Tendering pipeline worth RM 451 M, including one large design-build contract (RM 311 M).

• Targeting machinery, digital systems (BIM), and talent recruitment.

i) Ownership & Lock-in

• Promoter holdings: ~67.2%

• Lock-in: 6-month moratorium on sale; 12-month staggered restriction.

 Peer Comparison

a) Metrics Table

b) Other IPOs in Same Period

• No major ACE IPO launched concurrently.

• Hartanah’s oversubscription and size give it visibility among investors.

c) 10-Day Sector Performance

• Comparable small/mid-construction stocks saw minor gain/loss fluctuations, but no significant sector drag noted.

 Analyst Opinions

• Mercury Securities: “Subscribe”

  • Target price: RM 0.20

  • Based on 10× FY2026E EPS (RM 0.02)

 IPO Allotment Result

• Oversubscription ratio: 5.33×

• Tight allotments are expected to create buying pressure on debut.

Final Verdict

• With fair value estimated at RM 0.20 and IPO priced at RM 0.16, first-day trade range is estimated at RM 0.18–RM 0.20.

• Expect strong listing debut, especially given:

  • Full subscription

  • Promoter skin in the game

  • Reasonable valuation

  • Healthy order book

✅ Verdict: Worth subscribing for potential short-term gains and long-term hold.

Prospectus Download

https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3435355

Thank you