Senheng sees large potential in local E&E market

The group aims to upgrade or setup 61 new and existing stores from 2022 to 2024 to elevate the shopping experience of its customers 

by ANIS HAZIM / Pic Source: senheng.com.my

CONSUMER electrical and electronic (E&E) retailer, Senheng New Retail Bhd plans to raise RM267.5 million in proceeds from its IPO on the Main Market of Bursa Malaysia to fund its next transformation phase and shape the nation’s new retail landscape. 

Senheng’s IPO exercise entails the public issue of 250 million new shares and an offer-for-sale of 139.5 million existing shares at an issue price of RM1.07 per share. 

Of the proceeds to be raised from the public issue, the majority 60% or RM160.5 million will go towards setting up new stores as well as upgrading existing stores into bigger, enhanced concept stores. 

The group aims to upgrade or set up 61 new and existing stores from 2022 to 2024 to elevate the shopping experience of its customers. 

Another 19.3% or RM51.7 million will be used to strengthen the group’s back-end capacities and capabilities. This includes developing a new brand distribution business, expanding and upgrading the warehouse and logistics network, and boosting the group’s digital infrastructure. 

The remaining 20.7% or RM55.3 million will be utilised to repay bank borrowings and defray listing expenses. 

Based on an issue price of RM1.07 per share, Senheng will achieve a market capitalisation of RM1.6 billion upon listing. 

Senheng executive chairman Lim Kim Heng (picture) said the company foresees big growth potential in the domestic E&E products segment in the country. 

Lim added the group currently has no plans to go for any market in the region and will continue to focus on the Malaysian market. 

“We want to stay focused in the country and we foresee there is still big room for us to grow over here,” Lim said after the virtual listing ceremony yesterday. 

Senheng aims to strengthen its market share in home appliances to 30% by 2025 from the current 13%, he added. 

Senheng aims to upgrade or set up 61 new and existing stores from 2022 to 2024 to elevate the shopping experience for customers. 

“We are now in every state in Malaysia, but still there are quite a number of towns that we are not present in yet. We will have both Senheng (in the mall) and SenQ (on the street) stores,” its president Lim Kim Chieng said. 

Kim Chieng added Senheng’s customers are increasingly purchasing via its online platforms due to the additional convenience, while its physical retail stores serve as experiential centres for customers to get up close with the brands and products of their liking. 

“Going forward, we will enhance our in-store shopping experiences and upgrade our operational capabilities to continue providing the best of seamless retail experiences to all our customers,” he added. 

Despite the Covid-19’s lockdowns, Senheng’s revenue grew 13.1% to RM1.3 billion in the financial year of 2020 as it upgraded its stores, offered a larger product variety and leve-raged its PlusOne loyalty programme. 

“Going forward, we are targeting dividend payouts of at least 30% of the net profit attributable to shareholders to reward our shareholders for their confidence in Senheng,” he further said.