KUALA LUMPUR (June 18): Shares in steel pole maker Mestron Holdings Bhd rose as much as 31% in active trade upon its ACE Market debut this morning.
At 10.45am, the stock was trading 2.5 sen higher at 18.5 sen, bringing a market capitalisation of RM146.15 million.
It topped Bursa Malaysia's most active list with 261.27 million shares done, accounting for about a third of the broader market total turnover of 754 million shares.
Mestron managing director Por Teong Eng said in a statement following the company's debut today that broadband network convergence, including 5G technology, will be a key catalyst for the company's manufacturing segment, as it will create demand for specialty poles such as high mast and telecommunication monopoles.
Por added that Mestron will also benefit from the growing demand for the LED outdoor lighting products, as LED lighting products had higher specifications and quality as compared to the traditional light bulbs and thus, fetch higher sales value.
Under its initial public offering (IPO), Mestron has raised RM25.28 million from its public issue of 158 million new shares at 16 sen per share, of which 39.5 million new shares were for the Malaysian public, 8.75 million new shares for its eligible directors and employees, 30.75 million new shares privately placed to selected investors, and 79 million new shares privately placed to identified Bumiputera investors.
As part of its listing exercise, Mestron's existing shareholders also made an offer for sale of 79 million shares by way of private placement to selected investors.
The public portion of Mestron's IPO was oversubscribed by 17.53 times.
Of the total IPO proceeds, RM13 million (51.4%) will be used to expand its main manufacturing facility and acquire more manufacturing machineries and equipment for future business growth.
The group will further use RM5.18 million (20.5%) for working capital to purchase raw materials such as steel plates and steel pipes to support capacity expansion, RM4 million (15.8%) to repay bank borrowings, while the remaining RM3.1 million (12.3%) will be used to defray listing expenses for the IPO.