Ecomate makes stellar debut on ACE Market, hits high of 70.5 sen – The Star Online

KUALA LUMPUR: Muar-based ready-to-assemble (RTA) furniture specialist, Ecomate Holdings Bhd made a strong debut on the ACE Market on Monday, rising to a high of 70.5 sen.

At 70.5 sen, this was 37.5 sen or 113% above its offer price of 33 sen.

Ecomate opened at 68 sen or 35 sen or 106.1% above its issue price of 33 per share. The opening volume was 10.6 million shares.

Ecomate raised RM16.17mil from the public issue under its initial public offering (IPO), of which RM6mil or 37.1% will be used to acquire new machinery and equipment.

Another RM2mil or 12.4% will be allocated to finance its new factory and hostel construction; RM5.27mil or 32.6% to purchase raw material, and the remaining RM2.90mil or 17.9% for listing expenses.

Ecomate managing director Jason Koh Jian Hui said, “We are very delighted with the strong opening performance of our stock. This demonstrates the confidence that investors have on our business model and future prospects.

“As we begin our journey today as a public-listed entity, we will certainly continue to deliver value to all our stakeholders. Now, with the proceeds raised from the listing exercise, we are excited to embark on our next phase of growth.”

Koh added the proceeds raised from this IPO would allow it to implement its growth strategies expediently.

He also said Ecomate will add a new production line in its first factory as it is operating at near full capacity.

“We will also be constructing our new third factory, Factory C, which can house another three lines. Taken altogether, we will boost our capacity by 316,800 units or about 67% to 787,200 units per annum from the current output of 470,400 units per annum. Factory C is slated for completion by 2024.”

Koh was upbeat on the outlook of the furniture industry due to the prevailing geopolitical tension between the North America and China which has routed many furniture orders to South-East Asia.

He also pointed out that as e-commerce activities accelerate as more consumers choose to shop online during the lockdown measures implemented worldwide, he expects purchases of RTA furniture are expected to stay buoyant.

On Ecomate’s latest second quarterly results for the financial period ended August 2021, he said it posted a net loss of RM1.80mil on revenue of RM6.5mil.

“The loss was due to the curbs which hit the entire furniture industry during the Full Movement Control Order, which spanned across its reporting period of between June 1 and Aug 31 2021. Additionally, we also incurred listing expenses of RM700,000 during the quarter under review.”

However, Koh said there were no order cancellations and Ecomate has since resumed full operations from mid-September and are busy fulfilling the backlog.

“At the same time, new orders continue to come in too. We expect our financial performance in the coming quarters to rebound strongly. We are confident to deliver breakthrough performance for the financial year ending February 2023, based on current growth trajectory and barring unforeseen circumstances,” Koh added.

For the IPO exercise, M&A Securities Sdn Bhd is the adviser, sponsor, underwriter and placement agent.

Among those present at the listing included M&A Securities Sdn Bhd deputy head of corporate finance Rachel Ho; head of corporate finance Gary Ting; managing director of corporate finance Datuk Bill Tan and representatives of Ecomate Holdings Bhd, managing director Jason Koh Jian Hui, executive director Koh Cheng Huat and independent non-executive directors Datuk Lee Ching Yong; Ong Tian Soon and Lim Yik Hui.

source: Ecomate makes stellar debut on ACE Market, hits high of 70.5 sen – The Star Online

Tags: #Corporate News #Ecomate #IPO #Jason Koh Jian Hui #MCO #ready-to-assemble furniture

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