KUALA LUMPUR (April 21): MTT Shipping and Logistics Bhd (KL:MTTSL) turned lower in its first day of trading and underperformed the broader market amid geopolitical turmoil in the Middle East.
The counter opened at RM1.08 compared to its initial public offering (IPO) price of RM1.03 per share. The stock hit a high of RM1.08 but gave up all of the gains within minutes of opening bell and fell to as low as 99.5 sen.
MTT Shipping closed at RM1.00, down three sen or nearly 3% after more than 62 million shares traded. At the last price, MTT Shipping’s market capitalisation stood at RM2.5 billion.
The debut would the third-worst among the four listings on the Main Market so far this year on the heels of Golden Destinations Group Bhd’s (KL:GDGROUP) 11% decline on its debut earlier this month and Hock Soon Capital Bhd (KL:HOCKSOON) that fell 7% on its first trading day in February.
The debut comes at a time when the conflict between the US and Iran continues to deepen near the two-month mark. There are also no signs of peace before a fragile ceasefire expires in less than 24 hours.
Ahead of the listing, retail investors oversubscribed MTT Shipping’s shares by a little under three times while institutional investors fully took up the allocated shares.
MTT Shipping is mainly involved in container liner shipping services, vessel chartering, container storage, and other related services, with operations spanning key regional markets including Brunei, China, India, Indonesia, Thailand and Singapore.
The IPO raised RM652 million and there was no offer for sale, meaning that none of the major shareholders are cashing out their stake. The bulk of proceeds from the IPO will be used for the acquisition of at least 12 container vessels within three years.
CIMB Investment Bank has been appointed as principal adviser, joint global coordinator, joint bookrunner, managing underwriter and joint underwriter for the IPO. CLSA is the joint global coordinators and bookrunners, alongside Affin Hwang Investment Bank as joint bookrunner and underwriter.