KUALA LUMPUR (July 2): ASM Automation Group Bhd (KL:ASM) ended its first day on the ACE Market underwater, bucking broader market gains, amid weak demand from investors during its initial share sale.
The company, which supplies automation systems to the food and beverage manufacturing industry, opened at 17 sen, unchanged from its initial public offering (IPO) price. ASM Automation traded in tight range between 16 sen and 17.5 sen throughout the day before closing 3% lower at 16.5 sen.
At the last price, the company has a market capitalisation of RM88 million.
In contrast, the industrial products and services sector was slightly higher and the country’s benchmark index FBM KLCI was up 0.6%.
While demand from individual public investors exceeded the amount of shares available for subscription by 1.27 times, shares set aside for approved Bumiputera through private placement were undersubscribed and had to be reallocated to other investors.
ASM Automation, which provides automation systems for food and beverage manufacturing, offers services like machine upgrades, maintenance, and spare parts supply.
The company plans to spend RM11.4 million (over half its IPO funds) to buy land for a new 70,000 sq ft factory.
It will also use RM2.3 million to buy machinery and build demo units, and RM2 million to hire more design and development staff.