KUCHING: Hartanah Kenyalang Bhd targets to raise RM19.3 million from its Initial Public Offering (IPO) in conjunction with the listing of its entire enlarged issued share capital of 620.0 million ordinary shares on the ACE Market of Bursa Malaysia Securities Bhd, scheduled for June 9, 2025.
The Sarawak-based construction and infrastructure group’s IPO comprises a public offering of 198.4 million ordinary shares, made up of a public issue of 120.9 million new shares and an offer for sale of 77.5 million existing shares, collectively representing 32.0 per cent of the Company’s enlarged issued share capital.
Of the 120.9 million new shares, 31.0 million are allocated for application by the Malaysian public and 18.6 million for eligible directors, employees, and individuals who have contributed to the Group’s success.
The remaining 71.3 million new shares will be offered via private placement to selected investors.
The 77.5 million existing shares will be placed to identified Bumiputera investors approved by the Federal Investment, Trade and Industry Ministry.
Priced at RM0.16 per share, its statement stated that the IPO is expected to raise RM19.3 million in proceeds.
It noted that the public subscription for the 31.0 million new shares opened yesterday at 10:00 am, and closes on May 27 at 5:00 pm.
“The proceeds will be fully utilised across four key areas, namely RM3.0 million (15.5 per cent) for the purchase of new machinery and IT-related hardware and software, RM10.5 million (54.2 per cent) for project working capital, RM2.1 million (10.9 per cent) to repay bank borrowings, and RM3.8 million (19.4 per cent) to cover estimated listing expenses,” it said.
Based on the IPO price and the enlarged issued share capital, Hartanah Kenyalang is expected to debut with an indicative market capitalisation of RM99.2 million.
The Group has shown robust financial performance, with revenue growing from RM34.1 million for the financial year ended October 31, 2021 to RM 127.6 million in 2024, reflecting a compound annual growth rate (CAGR) of 55 per cent.
Moreover, profit after tax also rose from RM4.8 million to RM9.2 million over the same period, representing a CAGR of 24 per cent.
Commenting on the IPO launching, managing director Seah Boon Tiat pointed out that the Group has experienced significant growth over the past 11 years of operating history in the construction industry in Sarawak.
“Today, we are filled with excitement as we embark on the next phase of our corporate journey, that is, the dream of transitioning Hartanah Kenyalang into a public listed company on the ACE Market which is soon to become a reality.
“Under the Sarawak Budget 2025, the state government has allocated RM10.9 billion for development expenditure and the state will continue to prioritise infrastructure development in Sarawak.
“This is a vital role in boosting the economic growth of the state and to enhance connectivity in Sarawak. In addition, a sum of approximately RM1 billion has been specifically allocated for the construction of various roads and bridges to improve the land infrastructure in Sarawak under the state’s 2025 Development Budget.”
Following this, he shared that part of the IPO proceeds will be used to purchase six new excavators to replace older machinery, thereby enhancing project capacity and productivity.
“In addition, we also plan to expand into offering design and build services for our building construction services segments and infrastructure construction services segments by investing in the Building Information Modelling system (BIM).
“BIM is a technology that can digitise various aspects of a construction project, enabling seamless collaboration among project owners, architects, consultants, engineers and contractors by using a 3-dimensional model.”
As of April 30, Seah disclosed that the Group has tendered for various building and infrastructure projects with a total contract value of RM451 million, of which RM 311 million involves a design and build construction project.
“By expanding our design and build services, we are confident that this strategic move will enable us to climb up the construction industry’s value chain and to increase our overall competitiveness in the marketplace.”
For the record, Hartanah Kenyalang launched its IPO prospectus at the Sheraton Kuching Hotel here yesterday.
TA Securities Holdings Berhad has been appointed as the Principal Adviser, Sponsor, Sole Underwriter and Sole Placement Agent for the IPO exercise.
Hartanah Kenyalang is principally an investment holding company, while its subsidiary, Hartanah Construction Sdn Bhd, is involved in building construction services, with a focus on institutional buildings such as schools and other public buildings, and other non-residential buildings; as well as infrastructure construction services, with a focus on bridges and roads.
