KUALA LUMPUR (Oct 7): Shares of newly listed SDS Group Bhd were the most actively traded on the bourse upon making its debut on the ACE Market this morning.

The Johor-based home-grown bakery products manufacturer and distributor's share price stood at 25 sen, with 71.32 million shares done at noon market close, giving it a market capitalisation of RM101.5 million. The stock earlier opened at 26 sen, a 13% premium to its issue price of 23 sen.

Having raised RM23.99 million from the listing exercise, SDS said RM6 million (25%) will be used to expand its business presence for both the wholesale and retail channels within the northern and central regions of Peninsular Malaysia respectively, with the additional capacity from its new manufacturing plant in Seremban.

It will further use RM7.79 million (32.5%) for general working capital requirements, RM7 million (29.2%) to repay bank borrowings while the remaining RM3.2 million (13.3%) will be used to defray listing expenses for the initial public offering.

The company is expected to open eight new food and beverages (F&B) outlets under its retail business in established residential areas within the Klang Valley over two years, according to its managing director Tan Kim Seng.

"We expect to open three F&B outlets by October 2020 [and] the remaining five outlets by October 2021. Currently, SDS Group has 33 F&B outlets in Johor," he said.

For the expansion plan into Penang and Kedah, Tan said SDS Group will set up two new depots in Bukit Mertajam, Penang and Sungai Petani, Kedah and purchase 18 new delivery vehicles.

"To grow our wholesale business in order for us to extend the reach of our bakery products, we need to widen our distribution network and increase our logistics coverage. The two new depots and 18 new delivery vehicles in Penang and Kedah will enable us to cover the northern region," he further added.

SDS Group has 19 depots across Peninsular Malaysia and 250 one-tonne delivery vehicles distributing its products to some 10,000 customers, which include convenience stores and supermarkets.

The listing exercise saw a public issue of 104.29 million new shares at 23 sen per share, of which 20.29 million new shares were made available to the Malaysian public via balloting, 23.13 million new shares for its eligible directors, employees and business persons who have contributed to the success of SDS Group while the remaining 60.87 million new shares are earmarked for private placement to selected investors.