Advancecon debuts at 74 sen for 11 sen premium in IPO
KUALA LUMPUR: Advancecon Holdings Bhd yesterday debuted on the Main Market of Bursa Malaysia at 74 sen, for a premium of 11 sen, above its initial public offering (IPO) price of 63 sen.
The earthworks and civil engineering services specialist, which had its public subscription shares oversubscribed by 10.28 times, saw 11.77 million shares traded at the opening bell.
Chief operating officer/ executive director Yeo An Thai said he was pleased with the premium which was about 17.46 per cent above the issue price of 63 sen per share.
“It shows investors’ confidence in the company,” he told a press conference after the listing ceremony yesterday.
Following the listing, Yeo said the company would continue to aggressively participate in tenders, nationwide.
“Our tender book will soon exceed RM1.5 billion and we have
Our tender book will soon exceed RM1.5 billion and we have a successful rate of about 10 per cent. Yeo An Thai, Advancecon chief operating officer/ executive director
a successful rate of about 10 per cent,” he added.
Yeo also said Advancecon was currently bidding for the East Coast Rail Line project but he declined to divulge details as the company had signed a nondisclosure agreement.
Moving forward, Yeo painted a bright outlook for the company with turnover expected to double over the next five years, up from RM234 million recorded in 2016.
“We will still focus on earth works and civil engineering, of which the former will continue to contribute about 50-60 per cent to total revenue while the engineering business will contribute the balance,” he added.
Advancecon held 22.3 per cent market share of the earthworks market in 2016.
The company aimed to raise RM56.7 million in proceeds from the listing exercise.
A total of RM29.7 million will be allocated for capital expenditure to purchase new construction equipment and machinery such as excavators, motor graders and tipper trucks (RM15.1 million), and for the construction of a new workshop for in-house maintenance, modification and repairs of the group’s machinery fleet (RM14.6 million).
The balance of the proceeds would be set aside for working capital (RM10.7 million), repayment of bank borrowings (RM12.5 million) and listing expenses (RM3.8 million).