This article first appeared in The Edge Financial Daily on May 26, 2017

KUALA LUMPUR: Construction firm Inta Bina Group Bhd, which is planning to get a foothold in the affordable housing segment, made a strong debut on the ACE Market of Bursa Malaysia yesterday with its share price jumping as much as 32% to 33 sen.

At market close, the counter pared some of its gains to settle at 30.5 sen, still up 22% or 5.5 sen from its initial public offering (IPO) price of 25 sen per share. It was the second most active stock on the local exchange yesterday, with 126.42 million shares traded.

In a statement, Inta Bina managing director (MD) Paul Lim Ooi Joo said the affordable housing segment has growth potential and is receiving favourable attention from the government, as it gains traction in the local property market.

So, the group will take a more “active approach” in tendering for affordable housing projects in the Klang Valley from private housing developers under both federal and state affordable housing schemes.

“Our strategy to construct affordable housing projects efficiently is through the usage of aluminium system formwork. Aluminium system formwork is suitable for mass construction of buildings with repetitive design. As such, our proposed acquisition of the additional aluminium system formwork can support our plan to penetrate into the affordable housing segment,” said Lim.

Inta Bina’s IPO raised RM26.76 million from the public issue of 107.05 million new shares at an issue price of 25 sen per share. As part of its listing exercise, the company’s existing shareholders also made an offer for sale of 26.76 million shares to selected investors by way of private placement.

From the proceeds, it intends to spend RM5 million (18.68%) for capital expenditure to purchase various machinery and equipment, and to replace old ones; RM9 million (33.63%) to repay bank borrowings; RM9.56 million (35.73%) for general working capital to finance its day-to-day operations; and the balance RM3.2 million (11.96%) to be used to defray its listing expenses.

Based on its enlarged share capital of 535.26 million shares and its last traded price yesterday, it has a market capitalisation of RM163.25 million.