KUALA LUMPUR (Jan 16): MST Golf Group Bhd is seeking a listing on the Main Market of Bursa Malaysia, according to its prospectus exposure published on the Securities Commission’s website last Wednesday (Jan 11).

MST Golf, via its subsidiaries, are engaged in the specialty retail and wholesale of golf equipment comprising golf clubs, golf balls and accessories and golf apparel in Malaysia and Singapore.  

It operates a total of 42 retail outlets, with 35 outlets in Malaysia and the remaining eight outlets in Singapore.  
 
MST Golf’s proposed initial public offering (IPO) comprises some 228 million ordinary shares including public issue of 160 million and up to 68 million existing shares via offer for sale by way of private placement to identified Bumiputera investors approved by the Ministry of International Trade and Industry (Miti).  
 
The issue price of the shares has yet to be fixed.  

Of the 160 million new shares, a total of 41.5 million shares will be allocated to the Malaysian public; 76 million shares are made available for application by way of private placement to identified institutional and selected investors and 7.9 million shares for MST Golf’s eligible directors, employees and persons who have contributed to the success of the company.  

Meanwhile, 34.6 million shares are made available for application by way of private placement to identified Bumiputera investors approved by MITI.  

MST Golf’s substantial shareholders are All Sportz with a 64.76% stake, followed by its executive director or group chief executive officer Ng Yap Sio (12.95% stake) and executive chairman Low Kok Poh (6.48%).  

On its financial performance, the company posted a profit after tax (PAT) of RM13.69 million for the financial year 2020 (FYE2020) on a revenue of RM170.15 million, while FY2021’s PAT climbed to RM20.09 million as revenue rose to RM206.52 million.  

Going forward, the company plans to establish an additional 15 retail outlets including 10 retail outlets and five retail outlets with indoor golf centres between 2023 to 2025.  

“We plan to commence upgrading and refurbishing activities starting from the third quarter of 2023 to 2025 in stages, which include renovation as well as replacement of furniture and fittings in 10 retail outlets in Malaysia as well as our head office and warehouse at Subang Jaya, Selangor,” it said.  

In addition, it plans to increase its market presence in foreign countries namely Indonesia, Thailand and Vietnam. The expansion into these new foreign countries to establish golf retail outlets and indoor golf centres will be through joint venture arrangements with local partners in the respective countries to tap into their resources and network.  

“We also plan to invest in upgrading our digital technology facilities including enterprise resource planning (ERP) and IT-related systems to keep up with the company’s business expansion. The planned upgrade of our digital technology facilities will focus on areas including mobile and web portal applications for golf related services, expansion of ERP system in tandem with our business expansion, as well as enhancement of operational features incorporating new data analytics,” it added.  

It also targets a payout ratio of 30% of its PAT attributable to owners of the company for each financial year on a consolidated basis. “Prior to our listing, we intend to declare an interim dividend amounting to RM12.50 million for FYE 2022. The said dividend is expected to be payable in the first quarter of FYE 2023 and will be funded via our internally generated funds”.  

RHB Investment Bank Bhd is the principal advisor, sole underwriter and sole placement agent for the IPO exercise.