KUALA LUMPUR (July 15): Newly listed Yenher Holdings Bhd ended its maiden trading day at 90 sen, five sen or 5.26% lower compared with its initial public offering (IPO) price of 95 sen.

The animal health and nutrition product manufacturer, the third IPO on the Main Market this year, saw 61.83 million shares change hands, equivalent to almost 58% of 106.9 million shares Yenher offered for the listing exercise.

The stock opened at 99.5 sen, a 4.74% premium over its IPO price, and climbed to a high of RM1, but soon pared gains to a low of 87.5 sen within the first trading hour.

Based on the offer price of 95 sen a share, Yenher is priced at a trailing price-to-earnings ratio of 12.2 times of its calendar year 2020 core earnings, according to a TA Securities Research.

Yenher raised RM61.2 million from the listing exercise that cost it RM3.8 million.

The company has earmarked RM31 million for the construction of a new good manufacturing practice (GMP)-compliant manufacturing plant, RM9.7 million for purchases of new machinery and equipment while RM16.71 million will be for working capital.

Yenher's group managing director Cheng Mooh Tat, who holds a 7.5% stake, said the IPO exercise has given the group the opportunity to gain better access to the capital market for its business expansions.

Cheng said the group will continue to strengthen its presence in the domestic market by tapping into the growth of the local animal health and nutrition industry while exploring new markets to widen its global footprint.

Yenher is planning to expand its footprint into overseas markets such as Myanmar, Bangladesh and China, which have robust livestock industry and immerse opportunities.

"We aim for these three markets because of their population and big livestock sizes. We have been in the animal health and nutrition product industry for the past 30 years and we have got a significant market share within Malaysia.

"We are confident that we can get portions in those markets," said Yenher's deputy general manager of finance Lim Sek Yang at a virtual media briefing today.

Meanwhile, Cheng said that the company intends to adopt a dividend policy of a 40% payout ratio.

For the first quarter ended March 31, 2021, the group posted a net profit of RM4.94 million and a revenue of RM58.79 million, contributed by its manufacturing and distribution activities.

RHB Investment Bank Bhd was the sole principal adviser, sole underwriter and sole placement agent for the IPO.

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