Upcoming IPO deals to Look Out for in H2

Southeast Asia is emerging as a global IPO hotspot amid downturns in other markets where the region accounted for nearly 7% of the global IPO funds raised so far, up from 4% in the same period in 2022 (source from Refinitiv). Malaysia is poised to have a good year ahead for IPO after a few successful listings earlier in the first quarter of the year.

The recently launched prospectuses, property developer, Radium Development Bhd, and health supplement company, DXN Holdings Bhd, have been gaining much attention too following the latest triumphant IPO listing by Autocount Dotcom Bhd which was oversubscribed by 167 times. The momentum from the success is expected to continue on these recent launches which are slated to be listed in the Main Market.

Radium Development Bhd has fixed its IPO price at RM0.50 per share with market capitalization at RM1.73 billion upon listing on May 31^st. On the other hand, DXN Holdings Bhd’s IPO price is fixed at RM0.76 per share and is expected to translate into a market capitalization of RM3.79 billion upon listing on May 19^th. Their financial performance over the past three years are reported as follows:

Radium Development Bhd: Financial Revenue & PAT (2020-2022)

DXN Holdings Bhd: Financial Revenue & PAT (2020-2022)

Based on the previous Main Market listers’ performances i.e. Cape EMS Bhd and Kumpulan Kitacon Bhd in the first quarter of the year, which were oversubscribed by 17.82X and 11.46X, respectively, the new IPO listings in Main Market are usually well perceived and received. This upcoming Radium Development and DXN Holdings are predicted to follow the same impetus by having at least 10X oversubscription as well.

Moving forward, the next upcoming IPO in the Main Market would be MKH Oil Palm (East Kalimantan) Bhd or better known as MKHOP, an oil palm plantation arm of the property developer MKH Berhad. The group is planning to list MKHOP on the Main Market by Q4 2023 and M&A Securities has been appointed as MKH and MKHOP’s advisers for the proposals. MKHOP owns two oil palm plantation estates with a combined plantation area of 18,205.3 hectares, comprising 1,7008.8 hectares of planted area and 1,196.5 of unplanted area as at LPD.

MKH Bhd has proposed to undertake an IPO of 250.71 million MKHOP shares, representing 24.5% of MHKOP’s enlarged share capital after completing a slew of pre-listing corporate exercises. The issue price for the listing is to be determined later. MKHOP’s financial performance over the past three years is reported as follows:

MKHOP Bhd: Financial Revenue & PAT (2020-2022)

Our take for this upcoming MKHOP is to follow the same spur by having at least 10X oversubscription as well, more or less, judging from the well-received response and carry-on momentum from the past IPO listings so far. The past revenue performance has been promising as well, being on an ascending trend, despite slightly lower PAT. In light of this, as investors, it is important to decide on the prospects of this industry along with its valuation metrics. So, what is your take on this upcoming IPO?

Disclaimer: The views and opinions expressed are those of the authors and do not necessarily represent or reflect the view and stand of the company. Although we make strong efforts to make sure all our information is accurate, the company is not responsible for the content or accuracy of any information posted on this article, and shall not be held liable for any decisions made based on such information.