MN Holdings debuts at a premium on ACE Market

by S BIRRUNTHA / pic by TMR GRAPHIC

MN HOLDINGS Bhd (MNHB) debuted on the ACE Market of Bursa Malaysia at a premium of five sen or 23.81% over its IPO price of 21 sen. 

The underground utilities and substation engineering services firm’s shares closed the maiden trading day at 23.5 sen, and was the most actively traded counter on the exchange for the day. 

MNHB raised RM17.2 million from its IPO exercise. The listing included an offer for sale of 40.9 million existing shares to selected investors via private placement. 

MNHB’s ED Datuk Clement Toh said the group would use 34% or RM5.84 million of the IPO proceeds to buy various machinery and equipment over the next two years. 

“The acquisition of this machinery and equipment will enable us to increase the resources and capabilities in implementing projects that require different scales and complexities,” he said after the listing ceremony at Bursa Malaysia in Kuala Lumpur yesterday. 

Toh added 25.2% or RM4.33 million of the money raised will be used for general working capital to support its business expansion for the underground and substation engineering services and solutions segment. 

The remaining RM4 million or 23.3% of proceeds will go towards repaying bank borrowings. 

MNHB is in the middle of tendering for several large-scale solar (LSS) substation projects as the project management coordinator and for engineering design works. 

According to the group, potential new wins arising from the tenders would add to the group’s current order book of RM172.2 million (as at March 9, 2022) of which 21.4% or RM36.8 million comprise works from its substation engineering segment. 

The remaining 78.6% or RM135.4 million orders are works from its underground utilities engineering segment. 

MNHB’s managing director Loy Siong Hay said the company is well-positioned to secure more tenders as it had proven capabilities in undertaking LSS projects.

He added to-date, MNHB had secured three engineering, procurement, construction and commissioning (EPCC) projects under LSS2 in the capacity as a subcontractor. 

“We are involved in EPCC projects for main contractors who have secured solar photovoltaic power plant projects under the LSS programme, which was introduced by the Energy Commission of Malaysia in 2016.

“As an underground utilities and substation engineering specialist, we are capable of assuming the management and supervisory role of the entire project, and source for necessary construction materials, substation equipment and systems for installation and commissioning,” he added. 

Loy is also optimistic of the power infrastructure utilities industry in Malaysia given the transition to the endemic phase and the reopening of the country’s borders. 

He said this augurs well for the power infrastructure utilities industry in Malaysia as investments in utility infrastructure is driven by long term economic growth, population growth and urbanisation, growing demand for electricity, foreign and domestic investments and Malaysia’s renewable energy generation targets. 

MNHB reported a net profit of RM2.5 million in the second quarter ended Dec 31, 2021 (2Q22) on the back of RM26.1 million in revenue. Earnings per share for the period was 0.77 sen. 

For the cumulative six months ended Dec 31, 2021 (1H22), the group achieved a net profit of RM4.8 million on a revenue of RM49.8 million. 

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