This article first appeared in Capital, The Edge Malaysia Weekly on January 12, 2026 - January 18, 2026

RIDING on the blind box hype, Semico Capital Bhd (KL:SEMICO) is set to debut on the ACE Market of Bursa Malaysia on Jan 13. It will be the first listing of the year, following the two-decade-high 60 initial public offerings (IPOs) in 2025.

Semico is involved in the distribution of arcade and amusement machines and related services, and is a wholesaler of toys and collectables. Its portfolio includes brands such as Pop Mart, Funism, Jotoys and ToyCity, covering a wide range of series and designs.

Semico is looking to raise nearly RM28 million from its listing exercise, based on its IPO price of 25 sen per share. The public issue will raise RM23.17 million for expansion plans, while RM4.5 million from an offer for sale will go to MARC Experience Ventures Sdn Bhd, a vehicle controlled by CEO Tai Lee Chuen and his wife Ang Sew Fong.

Upon listing, the company is expected to have a market value of RM90 million.

As it does not have directly comparable listed peers in Malaysia, TA Securities has benchmarked Semico against selected regional players, which are trading at an average 2026 price-earnings ratio (PER) of 14.9 times.

After accounting for Semico’s smaller market capitalisation and lack of upstream manufacturing exposure, a 20% discount to the peer average PER has been applied for the company.

“Consequently, we derive a target price of 33 sen per share, based on 12 times 2026 EPS (earnings per share),” the research house said in a Dec 26 note.

Meanwhile, PublicInvest Research has derived a lower fair value of 29 sen by ascribing a 13 times PER multiple to 2026 EPS.

“This represents an about 20% discount to the Bursa Malaysia Consumer Products & Services Index’s PER of about 16 times. Despite its unique market positioning with no direct listed comparable and lucrative profit margins, we believe the discount is justified given Semico’s relatively small market capitalisation of under RM100 million,” it says in a Dec 29 note.

Semico’s net profit rose sharply to RM6 million in the financial year ended June 30, 2025 (FY2025) from RM1.2 million in FY2022, reflecting a three-year compound annual growth rate (CAGR) of 72.5%. Its net profit margins ranged from 22.2% to 26.3% between FY2022 and FY2025.

PublicInvest Research has forecast Semico’s earnings to grow at a three-year CAGR of about 15%, reaching RM9.3 million by FY2028, supported by the continued expansion of customers’ family entertainment centres and the group’s efforts to broaden its toys and collectables portfolio to sustain growth.

TA Securities expects Semico’s profit after tax and minority interests to grow by 32.3%, 26.8% and 29.4% in FY2026, FY2027 and FY2028 respectively, based on several key assumptions, namely an increase in the total number of arcade and amusement machines to 916 units by FY2028 (from 728 units in FY2025) with stable sales per machine; stronger sales contributions from the toys and collectables segment driven by enhanced product offerings and an expanding customer network; as well as lower interest expenses arising from reduced borrowings.

Nonetheless, TA Securities flagged Semico’s dependence on Pop Mart Group, at 47.1% of total purchases in FY2025, and that a slowdown in the blind box hype could affect its growth rates.

In FY2025, the toys and collectables segment accounted for 53.5% of Semico’s revenue, with the remainder from its family entertainment products and services. It operates a family entertainment centre in The Mines, Selangor.

While Semico does not have a formal dividend policy, it declared dividends of RM1.62 million in FY2025, equivalent to a 27% payout ratio.

“Accordingly, we adopted a conservative payout assumption of 25% for FY2026-FY2028, translating into estimated forward dividend yields of 2.4%, 3.1%, and 4% respectively,” TA Securities says.

Following the listing and utilisation of IPO proceeds, Semico’s net gearing is expected to decline to 0.01 times from 0.09 times on a pro forma basis.

Mercury Securities highlighted that Semico derives around 25% of its store footprint from southern Malaysia, positioning the group to structurally benefit from sustained cross-border discretionary spending by Singaporean consumers.

“While the Singapore dollar/ringgit has moderated from its recent peak, the currency remains structurally elevated versus pre-pandemic levels, preserving a meaningful affordability gap in favour of Malaysia, particularly Johor. In the base case, this affordability advantage supports higher discretionary spend per visit at Semico’s arcade entertainment and collectables outlets, translating into incremental and recurring revenue without requiring changes in visitation patterns.

“In an upside scenario, further appreciation in Singapore dollar purchasing power may also encourage increased visitation frequency and utilisation, providing additional demand-led upside. Collectively, these dynamics reinforce Semico’s resilient earnings profile beyond domestic consumption trends,” it added.

For the first quarter ended Sept 30, 2025 (1QFY26), it recorded a net profit of RM1.3 million on the back of RM7.26 million in revenue, with the family entertainment segment and the toys and collectables segment contributing 46.81% and 53.19% to total revenue respectively.

Looking ahead, the group remains optimistic about its prospects for the current financial year, driven by key growth factors in the theme park, family attraction and pop toys industries.

Industry growth is expected to be supported by government initiatives to support the tourism industry, the increasing number of shopping complexes in Malaysia, competitive pricing and packages for family entertainment centres, the growing popularity of pop toys from the rising influence of global pop culture as well as the country’s population growth and rising disposable income.

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