Agricore closes ACE Market debut day at 87.5 sen

NST Sat, Jun 22, 2024 10:20am - 3 months View Original


KUALA LUMPUR: Agricore CS Holdings Bhd made its debut on the ACE Market of Bursa Malaysia yesterday, trading at 79 sen, which represents a 58 per cent premium over the 50 sen price of its initial public offering (IPO).

The food ingredient provider has raised RM25.9 million during its IPO, mostly for the purpose of buying RM18.9 million worth of inventory to fuel its expansion.

The company will allocate RM2.7 million to expand storage capacity by setting up a new regional storage facility in Klang, Selangor, to enhance the efficiency of its business operations and increase its market presence in the food ingredients industry. 

A sum of RM600,000 will be allocated to recruit additional staff on Bukit Minyak premises, followed by RM3.7 million for the estimated listing expenses. 

Agricore had targeted a market capitalisation of RM101.4 million upon listing, based on an enlarged share capital of 202.8 million shares.

The company is mainly involved in the distribution and production of plant-based agricultural food ingredients, comprising starch products, beans and pulses, grain products, and other related products. It also produces and sells food additives and fried shallots under its own brand, Bapas and Cap Pokok.

Agricore is planning to expand its customer base in the sourcing and distribution business segment and revenue by ramping up inventory levels for the Bukit Minyak premises and the new regional storage facility in Klang. 

Its managing director, Oon Boon Khong, said in a statement that through higher inventory levels, the company will be able to drive its revenue growth by increasing sales volume to its existing customers as well as securing new customers. 

He added that it is imperative for the company to maintain a sufficient level of inventory to fulfill the demand from customers.  

"By increasing inventory levels, the group is poised to enjoy a higher sales volume, coming from existing and new customers, as well as ensure consistent product availability and prompt order fulfillment. 

"On top of that, since certain supplies are heavily reliant on seasonality as well as exposure to price fluctuations, having a higher inventory level in an unfavourable market condition allows the Agricore Group to gain a competitive advantage in terms of supplies and pricing strategy," he said. 

The content is a snapshot from Publisher. Refer to the original content for accurate info. Contact us for any changes.






Related Stocks

AGRICOR 0.515
BURSA 9.520

Comments

Login to comment.