Evergreen Max Cash Capital Berhad [萇菁 資本有限公司] (“EMCC” or the “Group”) has successfully launched prospectus in conjunction with initial public offering (“IPO”) and listing on the ACE Market of Bursa Malaysia Securities Berhad (“Bursa Securities”).
Established since 2012, the EMCC group of companies (“Group”) is principally involved in the pawnbroking business via its network of 22 “Pajaking” pawnshops in Kuala Lumpur, Selangor, Negeri Sembilan and Pahang. To complement its pawnbroking business, the Group is also involved in the business of retail and trading of gold and luxury products. In addition, the Group also offers pawnbroking consultancy and IT solution services to third-party pawnbrokers whom they have identified to be not in direct competition with their “Pajaking” pawnshops.
Executive Director and Group Managing Director of EMCC, Dato’ Low Kok Chuan (拿督刘国泉) said, “With the launch of our prospectus, EMCC is now one step closer to being a public listed company on the ACE Market of Bursa Securities. This IPO exercise is a crucial part of our long-term growth strategy as it would enable us to raise additional funds of RM64.2 million largely to finance the expansion of our pawnbroking business.”
According to the Independent Market Research Report by Providence Strategic Partners Sdn Bhd, the pawnbroking industry size in Malaysia is expected to grow from RM10.0 billion in 2021 to RM12.0 billion in 2024, i.e. at a compound annual growth 2 rate (“CAGR”) of 5.9%. Recognising this, the positive industry outlook is expected to bolster positively to our future plans.
Commenting on the Group’s future plans, Dato’ Low added, “To capitalise on the future demand for pawn loans, we seek to utilise RM30 million (46.7%) of the IPO proceeds towards funding the additional cash capital of our pawnbroking business and RM20 million (31.1%) for opening up to 5 new “Pajaking” pawnshops in Kuala Lumpur, Selangor and Pahang. The remaining IPO proceeds of RM14.2 million (22.2%) will be used for repayment of bank borrowings, our Group’s working capital purposes and to defray listing expenses. This expansion plan would in turn enable us to grow our pawnbroking business scale and thereby, to capture a larger market share and brand visibility.”
EMCC’s IPO comprise a public issue of 267.6 million new ordinary shares in EMCC (“Shares”), or 24.0% of its enlarged issued Shares, and an offer for sale of 43.0 million existing Shares, or 3.9% of its enlarged issued Shares, to selected investors by way of placement.
Out of the 267.6 million new Shares to be issued, 55.7 million Shares will be made available for application by the Malaysian public via balloting; 27.9 million Shares for its eligible Directors and employees as well as persons who contributed to the success of the Group (“Pink Form Allocations”); 44.6 million Shares by way of placement to selected investors; while the remaining 139.4 million Shares are earmarked for selected Bumiputera investors approved by MITI (Ministry of Investment, Trade and Industry).
Based on the IPO price of RM0.24 per Share and its enlarged issued Shares of 1,114.9 million Shares, EMCC’s market capitalisation upon listing is approximately RM267.6 million.
In terms of financial performance, the Group’s revenue has grown from RM14.8 million in the financial year ended 31 December 2019 (“FY19”) to RM67.2 million in the financial year ended 31 December 2022 (“FY22”), representing a CAGR of 65.6%. In tandem with the growth in its revenue, the Group had also recorded an increase in net profit from RM0.8 million in FY19 to 20.1 million in FY22, representing a CAGR of 193.3%.
In terms of dividend, EMCC intends to distribute a dividend of 20% of the PAT attributable to owners of the Company.
Following the prospectus launch, applications for the IPO are now open and will close on 12 September 2023 at 5:00 p.m. The Group is scheduled to be listed on the ACE Market of Bursa Securities on 26 September 2023.
Mercury Securities Sdn Bhd is the Principal Adviser, Sponsor, Underwriter and Placement Agent for the IPO exercise.
For media coverage, please refer link below:
1.https://theedgemalaysia.com/node/680625
3.https://www.orientaldaily.com.my/news/business/2023/08/29/592635
8.https://news.seehua.com/?p=1041624
9.https://theedgemalaysia.com/node/680635
