Construction-based Haily Group’s IPO oversubscribed by 38.81 times

ACE Market-bound Haily Group Bhd received overwhelming response from investors when its public issue of 355.1 million shares for its initial public offering (IPO) exercise was oversubscribed by 38.81 times.

Altogether, the main contractor involved in construction of residential and non-residential buildings in Johor received 13,367 applications with a value of RM241.47 mil from the Malaysian public.

For the Bumiputera portion, the company received 6,185 applications for 138.11 million shares, representing an oversubscription rate of 29.69 times while for the public portion, a total of 7,182 applications for 217 million shares were received, representing an oversubscription rate of 48.09 times.

Meanwhile, a total of 10 million public issue shares for eligible directors and employees of the group or persons who have contributed to the success of the group have also been fully subscribed.

Moreover, the placement agent has confirmed that the 5.98 million public issue shares and 5.3 million offer shares made available for application by way of private placement to selected investors have been fully placed out.

In relation to its 5.1 million public issue shares and 12.7 million offer shares made available for application by Bumiputera investors approved by MITI (Ministry of International Trade and Industry), a total of 2.16 million shares were not taken up.

Pursuant to the terms set out in the Prospectus, the said remaining unsubscribed shares were clawed-back and re-allocated to the Bumiputera public via the balloting process.

“We believe that the construction industry will show positive signs of recovery towards 2H 2021 bolstered by the country’s on-going national immunisation programme,” commented Haily’s executive director See Tin Hai.

“Thus, we look forward to more developments being revived by property companies which provide the construction sector with more project bidding opportunities especially in the Johor region where Haily is operating.”

The notices of allotment will be posted to all successful applicants on or before July 19 while Haily’s listing on the ACE Market of Bursa Malaysia has been tentatively slated for July 21.

In its recent evaluation of Haily, PublicInvest Research derived a fair value of 82 sen for Haily from its IPO price of 68 sen.

As of June 10, Haily has a total secured contract value and total unbilled order book of RM460 mil and RM249.6 mil respectively.

Moving forward, Haily intends to expand into industrial building construction to address opportunities provided by economic developments in Johor and to focus on its core competency in residential building construction by expanding its business mainly from Johor Bahru and Kulai districts into other districts in Johor. – July 12, 2021

 

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