KUALA LUMPUR (July 18): Well Chip Group Bhd (KL:WELLCHIP), which is set to be listed on the Main Market of Bursa Malaysia next Tuesday (July 23), said its net profit for the first quarter ended March 31, 2024 (1QFY2024) came in at RM11.9 million or 2.6 sen per share.  

Quarterly revenue was RM54.82 million, of which RM20.96 million or 38.22% was derived from its pawnbroking services segments and RM33.87 million (61.78%) was derived from its retail and trading of jewellery and gold segment, the Johor-based pawnbroker's bourse filing showed.  

There are no comparative figures as this is Well Chip’s first interim financial report ahead of its listing.

Well Chip said its plans to continue expanding its network of pawnshops in Johor and at the same time penetrate new geographical markets within Peninsular Malaysia.

“By expanding its network, the group would be able to increase its market presence and serve a wider customer base, allowing the group to further improve its financial performance in the future,” Well Chip said.  

Within the next 24 months, Well Chip aims to open five pawn shops in Johor and two in Melaka. 

Well Chip’s shares were offered at RM1.15 apiece, valuing the pawnbroker at the price-earnings (P/E) multiple of 19.54 times, based on earnings per share of 5.89 sen or net profit of RM35.32 million for the financial year ended Dec 31, 2023 (FY2023).

Of the RM172.5 million proceeds raised from its initial public offering (IPO), RM124.3 million will be utilised as cash capital for its existing 23 pawnshops. Another RM40 million will be used for the expansion of pawnshops, and the remainder will be used to defray listing expenses.  

The company intends to recommend and distribute dividends of at least 35% of its consolidated profit after tax attributed to its shareholders for the first three financial years after its listing.    

Kenanga Investment Bank Bhd is the principal adviser for the IPO. Together with CGS International Securities Malaysia Sdn Bhd, Kenanga is also joint underwriter and joint placement agent for the IPO.   

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