It began trading yesterday with an initial offering price of 36 sen per share and opened higher at 57 sen, increasing 68.1% to 60.5 sen
By LYDIA NATHAN
PRINTING specialist HPP Holdings Bhd has made its debut on the ACE Market of Bursa Malaysia Securities Sdn Bhd, also making it the first listing of this year amid MCO.
It began trading yesterday with an initial offering price (IPO) of 36 sen per share and opened higher at 57 sen, increasing 68.05% to 60.5 sen, after being oversubscribed 33.44 times.
The company said it will raise approximately RM31.9 million, of which RM13 million will be utilised for capital expenditure such as acquisition of printing machines,
RM7.8 million for repayment of bank borrowings, RM5.2 million for working capital, and RM2 million for sales and marketing expenses.
The remaining proceeds of RM3.9 million will be kept for defrayment of the initial public offering (IPO) expenses.
The IPO comprised 108.67 million shares, with 19.42 million shares being available to the public, 30 million shares for directors and employees, 19.83 million shares for private placement to investors.
Its non-executive chairman Lau Kim Wah said the IPO will give the company a platform to realise its aspirations and accelerate the expansion plans.
“It also elevates our status to be part of a world-class exchange such as Bursa Malaysia. I have confidence that our team will scale greater heights under the capable stewardship of our group MD Kok Hon Seng and ED Ng Soh Hoon,” he said.
Meanwhile, Public Investment Bank Bhd said in a note that the company plans to increase its standard format printing capacity and double the production capacity, which will better position the group.
The research house said its growth drivers will include its dependency on two additional standard format printing machines, acquisition of an additional rigid box production line and widening of its customer base through marketing.
It added that some of the key risks are competition within the industry, a shortage of raw materials and the fluctuating price of paper.
“Other risks foreseen will include the reliance on foreign workers for the factory, dependency on the consumer electrical and electronics industry and exposure to the foreign rates,” the research house said.