Flexidynamic debuts at 245% premium over issue price

The glove chlorination specialist is the 6th IPO on the stock exchange this year, and the 4th on the ACE Market

By HARIZAH KAMEL / Pic source flexidynamic.com

FLEXIDYNAMIC Holdings Bhd debuted on Bursa Malaysia Securities Bhd’s ACE Market yesterday at 69 sen per share, a 245% premium against its IPO price of 20 sen.

The stock closed its maiden day on the exchange at 43 sen after hitting a high 72 and low of 41.5 sen in intraday trade.

The glove chlorination specialist is the sixth IPO on the stock exchange this year, and the fourth on the ACE Market after HPP Holdings Bhd, Mobilia Holdings Bhd and Teladan Setia Group Bhd.

The sharp premium at open reflects the strong demand for the company’s IPO shares allocation to the Malaysian public of 14.19 million new shares that was oversubscribed by 155.72 times.

Flexidynamic MD Tan Kong Leong said the group’s opening price shows investors’ confidence in the company, despite the industry’s ongoing challenges.

“The successful IPO will strengthen our role as one of the major players in the glove manufacturing industry.

“As we move into a new phase of growth, I would like to encourage Flexidynamic members to continue to carry out our vision of further expanding the company business. I believe we can take Flexi- dynamic to new heights with this listing exercise,” he said in a virtual press conference after the listing debut.

Tan said he is very confident the worst is over for the group and expects a better sales outlook for the financial year 2021 (FY21) and FY22.

The group has seen its rubber-glove manufacturing activity grow significantly during the Covid-19 pandemic, with the surge in demand resulting in the nearly full utilisation of its production capacity.

“We strongly believe we can leverage this increase in activity, which will benefit the group in the long-run.

“We have come a long way from when we first started with a rented factory located in Banting, Selangor, carrying out design, engineering, installation and commissioning of online glove chlorination systems to what we are today, providing both on-line and offline glove chlorination systems with a wide customer base not only from Malaysia, but also Vietnam, Thailand, Indonesia and Sri Lanka,” Tan said.

Of the RM15.05 million raised from the IPO, RM6.38 million will be used to repay bank borrowings drawn to fund the acquisition of new factories.

A further RM420,000 will be used for the renovation of these factories, while RM1.63 million has been allocated for the purchase of machinery and equipment.

Another RM3.62 million will be allocated for working capital, with an additional RM3 million to be utilised for the estimated listing expenses.

Flexidynamic’s expansion includes building another two factories, which is expected to be completed by May 2021, with operations to start in the third quarter of the year.

Both factories will have new machinery and equipment to carry out in-house manufacturing works and components for online glove chlorination systems.