KUALA LUMPUR, June 18 — Rakuten Trade has set a “buy” call on Mestron Holding Bhd on the steel pole maker’s intentions to enhance its international footprint namely in Brunei, New Zealand and Sri Lanka.
The company made its debut on Bursa Malaysia’s Ace Market today with a premium of four sen, from its initial public offering of 16 sen per share with 82.26 million units traded.
Under the listing exercise, Mestron has raised RM25.28 million from its public issue of 158.0 million new shares at RM0.16 per share.
Of the total proceeds, RM13 million (51.4 per cent) would be used to expand its main manufacturing facility and to acquire more manufacturing machineries and equipment for future business growth.
“The expanded facility which is expected to complete by the second half of 2021 will double Mestron’s production capacity from 5,700 metric tonnes per year to 11,400 MT/year.
“The management plans to expand their revenue stream from specialty poles which garner higher gross profit margin,” it said in a statement.
As of April 30, 2019, Mestron’s order book stood at RM31.6 million and with monthly order replenishment of RM5 million to RM6 million, it should be able to provide recurring income to the group.
The research house has set a target price of 20 sen for the company.
At 12.11 pm, shares of Mestron rose 1.5 sen to 17.5 sen with 324.24 million shares transacted. — Bernama
Source: The Malay Mail Online