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KUALA LUMPUR (Sept 19): Automotive manufacturer parts supplier KHPT Holdings Bhd (KL:KHB) on Thursday launched its initial public offering (IPO) on the ACE Market which would raise RM29.37 million.
The IPO, priced at 20 sen per share, involves a public issue of 108.64 million new shares and an offer for sale of 38.23 million existing shares, according to its prospectus. All in, the listing offers investors a 27% stake in the Selangor-based company.
Application for the IPO shares will close on Sept 25, and listing has been scheduled for Oct 8.
At the IPO price, KHPT will have a market capitalisation of about RM80.48 million upon listing with an enlarged share capital of 402.39 million shares.
KHPT’s earnings per share (EPS) came in at 1.38 sen for the financial year ended Dec 31, 2023 (FY2023), based on its audited profit after tax of approximately RM5.53 million and enlarged share capital of 402.38 million shares upon listing. This translates into a price-to-earnings (P/E) multiple of 14.45 times at the offer price of 20 sen, according to the prospectus.
The automobile part maker booked a one-off impairment loss of RM1.03 million on the non-current asset held for sale. Excluding the impairment loss, the company’s profit after tax would have been RM6.56 million or 1.63 sen per share. Based on the adjusted EPS, KHPT shares would have been valued at P/E of 12.26 times at 20 sen.
KHPT mainly manufactures and sells automotive parts and components in Malaysia, catering to Proton and Perodua vehicles for more than 20 years.
The products include body parts, seats structures and other parts like customised engine components and absorber parts sold to Proton and Perodua directly or through their respective Tier 1 manufacturers.
Under the public issuance, 20.12 million new shares are allocated to the Malaysian public, while 10.06 million shares are earmarked for eligible persons. The group will also sell 78.47 million shares to approved selected investors through a private placement.
KHPT expects to raise RM21.73 million from the issuance of new shares, of which RM11.05 million will be utilised for the purchase of press machines to expand its manufacturing capacity and RM4.50 million for acquiring automation equipment to reduce manual labour.
Another RM820,000 will be allocated for the purchase of an overhead crane and for renovating the current factory at Telok Panglima Garang in Selangor, while the remaining proceeds have been earmarked for working capital and to offset expenses in relation to the IPO.
Meanwhile, the offer for sale of existing shares will raise RM7.65 million, which will go entirely to the selling shareholders and managing director Datin Eloise See, and Tiu Kuang Hong, the technical director of KHPT's subsidiary Automev Global Sdn Bhd.
Post-IPO, See’s direct stake will be diluted to 55.62%, while Tiu will cease as a substantial shareholder but will still be left with a 4.23% stake in KHPT.
KAF Investment Bank Bhd is the principal adviser, sponsor, underwriter and placement agent for the IPO exercise.