KUALA LUMPUR (Nov 6): 3REN Bhd (KL:3REN) made an impressive debut on the ACE Market of Bursa Malaysia on Wednesday, with a closing price of 39.5 sen, a 41.07% rise or 11.5 sen higher than its initial public offering price (IPO) of 28 sen.
The counter opened at 33.5 sen, up 19.6% or 5.5 sen. The stock traded between 33 sen and 40 sen throughout the day.
At the closing price of 39.5 sen, the company was valued at RM256.8 million. The counter was the most actively traded stock on the local bourse, with 181.04 million shares changing hands.
The share price performance followed Wednesday’s jump in stocks of companies in the technology sector, which is a key segment for 3REN, as investors bet on better prospects in markets like the US following signs of victory for Republican candidate Donald Trump in the US election.
3REN is principally involved in the provision of automation solutions and engineering services which encompass the design, development and sale of digitalised solutions and automated equipment, as well as provision of product engineering services and engineering support services for integrated circuit development, assembly and testing.
The group’s products and services cater to various segments of the semiconductor, electronics and manufacturing industry value chains.
Its executive director and chief executive officer Koh Dim Kuan said the group had positioned itself at the centre of the booming semiconductor industry backed by key demand drivers coming from the technological revolution, embracing technologies such as artificial intelligence, 5G and the Internet of Things.
He pointed out that Southeast Asia had also since emerged as a hotspot for manufacturing activities due to the increasing demand for outsourcing activities, which will serve as a strong catalyst given the modernisation and transformation of manufacturing facilities towards Industry 4.0 and 5.0, providing 3REN with room to further extend its growth.
“Given the opportunities that lie ahead, our strategic plans bode well for us to capture higher market share, and we look forward towards the next chapter of our journey as a listed entity,” he said.
Apart from Malaysia, 3REN has a presence in countries such as Thailand, Singapore, the US, China, Vietnam, the Philippines, Canada, Costa Rica, India, Mexico and Taiwan.
The group successfully raised RM30.8 million from the sale of new shares, of which RM19.2 million had been allocated towards business expansion, while the remaining balance of RM11.6 million will be channelled towards the repayment of bank borrowings and to defray listing expenses.
For business expansion, RM7.2 million will be used to set up new delivery centres, followed by RM5.1 million for research and development expenditures, RM3 million to establish a new Singapore office, and RM3.9 million for working capital.
Meanwhile, RM12.6 million of proceeds were raised from the offer of sale of 45 million existing shares — representing approximately 6.92% of 3REN's enlarged issued share capital — which are going entirely to selling shareholders Koh, Lee Chee Hoo, Low Chee Onn and Malaysian Technology Development Corp Sdn Bhd (MTDC).
Lee is 3REN’s group executive director, while Low is the group business development manager.
MTDC is a technology venture capital outfit wholly owned by Malaysia's sovereign wealth fund, Khazanah Nasional Bhd.
KAF Investment Bank Bhd is the principal adviser, sponsor, sole underwriter and sole placement agent for the IPO.