KUALA LUMPUR (Feb 12): Payment solutions provider Revenue Group Bhd (KL:REVENUE) plans to raise up to RM193.63 million via a right issue with warrants, mainly to fund its venture into the money lending business.

The cash call consists of up to 2.42 billion rights shares on the basis of four new shares for every existing share held, and up to 1.21 billion warrants on the basis of one warrant for every two rights shares subscribed.  

With the rights issue priced at a discounted price of 0.081 sen per share, the exercise is expected to raise between RM14.71 million on a minimum subscription basis and RM193.63 million under a maximum scenario.

Under the maximum scenario, the group expects to allocate RM147.5 million as working capital for its money lending business.

Another RM15 million is earmarked for the expansion of its digital payment services, and a further RM15 million for the development of digital solutions, system, platform and infrastructure.

The group plans to use another RM15.26 million of the proceeds to fund its working capital requirement, to pay for its suppliers and creditors and operating and administrative expenses.  The remaining RM870,000 will go towards defraying the expenses for the proposals.

As of Feb 10, Revenue Group's cash and bank balances stood at RM19.33 million. Total borrowings, meanwhile, stood at 18.86 million as at Sept 30, 2024, with the gearing ratio at 0.18 times.  

Revenue Group’s loss after tax narrowed to RM10.28 million in the financial year ended Sept 30, 2024 (FY2024) from RM89.31 million in the 15 months of FY2023. The group attributed this to higher gross profits achieved, coupled with cost rationalisation and cost containment efforts.

It recorded a revenue of RM387.42 million in FY2024, compared with RM531.93 million in FY2023.  
 
Revenue Group’s share price closed unchanged at 12 sen on Wednesday, giving the group a market capitalisation of RM73 million.

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