KUALA LUMPUR (Nov 12): Jati Tinggi Group Bhd (KL:JTGROUP), which was listed on Bursa Malaysia’s ACE Market in December last year, plans to raise RM14.1 million via a private placement to fund new projects.

The cash-call involves the issuance of up to 39.18 million new shares, representing up to 10% of the company's issued shares, to third party investors at an issue price to be determined later, said the the infrastructure utilities engineering services provider in a bourse filing.

For illustrative purposes, based on assumed issue price of 36 sen per share, Jati Tinggit is expected to raise gross proceeds of RM14.1 million, mainly as its working capital to fund newly secured projects.

“Since the listing, the group has secured and announced a total of nine new material contracts with a total contract amount of approximately RM269.66 million. The group’s working capital requirements are expected to increase in line with the growth in the group’s business operations,” the company said.

Last year, Jati Tinggi raised RM18.04 million from its initial public offering (IPO). Of this,  RM7.34 million had been allocated for general working capital, followed by RM7 million for repayment of bank borrowings, RM3.5 million for estimated listing expenses and RM200,000 for capital expenditure.

Besides the private placement, Jati Tinggit has also proposed to establish an employees’ share option scheme with the number of new shares allotted not exceeding 30% of its total issued shares.

“The proposals are not inter-conditional upon each other. The proposals are not conditional upon any other proposals undertaken or to be undertaken by the company,” it said.  

The proposals are subject to approvals including Bursa Securities and its shareholders and are expected to be completed in the second quarter of 2025.

For the first nine months ended Nov 30, 2024, Jati Tinggi's net profit almost tripled to RM9.26 million from RM3.5 million in the previous corresponding period, as revenue increased 15% to RM90.9 million from RM79.06 million.

The company attributed the jump in  earnings to a gain on disposal of investment property of RM7.37 million and lower interest expense for a term loan attributable to the investment property.  

Jati Tinggi’s share price settled one sen or 2.5% lower at 39 sen, giving the company a market capitalisation of RM153 million. Compared with its IPO price of 27 sen, the stock has gained 44%.