Tashin falls 16% on ACE Market debut

TheEdge Fri, Aug 02, 2019 10:00am - 4 years View Original


KUALA LUMPUR: Steel processor and manufacturer Tashin Holdings Bhd shares closed 9.5 sen or 16.38% lower at 48.5 sen on its first day of trading yesterday after opening at its initial public offering (IPO) price of 58 sen.

The stock, with a market capitalisation of RM169.26 million, is the seventh ACE Market-listed company on Bursa Malaysia this year.

It is also the second counter to close below the IPO price on the maiden trading day, after Kim Hin Joo (Malaysia) Bhd.

Tashin was the sixth most active stock on Bursa yesterday, with 53.15 million shares changing hands.

Of the IPO proceeds totalling RM34.41 million, Tashin managing director (MD) Lim Choon Teik said the company plans to utilise RM25.25 million to expand its business operations, including setting up a factory and upgrading its existing steel processing line in Seberang Prai, Penang.

“We believe the addition of wire mesh to our manufactured product offerings will allow us to improve our profitability and strengthen our customer base, in turn enhancing our competitive position. Our plans to make new products hinge on market developments,” Lim told reporters at the listing ceremony yesterday.

Lim added, in a press statement, that the factory will have additional steel processing lines and five new wire mesh production lines with a combined effective production capacity of 50,000 tonnes per annum.

The new 90,000 sq ft factory to produce wire mesh is expected to be completed by 2021.

Furthermore, RM5.96 million is for general working capital, with the remaining RM3.2 million to defray listing expenses.

Tashin, whose current core activity is steel processing and manufacturing steel products, is expanding the manufacturing and trading of wire mesh.

“The manufacturing of wire mesh will enable the company to diversify its manufacturing products and improve profitability,” said the company.

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