Latest news with #AffinHwangIB
The Star
14-05-2025
- Business
- The Star
Signature Alliance targets RM161mil from IPO
From left: Affin Hwang IB head of equity capital markets Arvin Chia, Signature Alliance Group shareholder Melvin Ng, executive director Mario Foo, group CEO Darren Chang, shareholder Datuk Seri Chiau Beng Teik, shareholder Chiau Haw Choon, M&A Securities managing director Datuk Bill Tan, head of corporate finance Gary Ting, Chin Hin Group group chief financial officer Michael Lim and Signature Alliance Group director Lau Kock Sang. PETALING JAYA: Interior fit-out solutions provider Signature Alliance Group Bhd (SAG) aims to raise RM161.2mil in proceeds via an initial public offering (IPO) on the ACE Market of Bursa Malaysia on June 5, 2025. The IPO entails the issuance of 260 million new ordinary shares at an issue price of 62 sen each, valuing the company at an estimated market capitalisation of RM620mil upon listing. Executive director and group chief executive officer (CEO) Darren Chang said over half of the proceeds would be allocated to developing a new corporate headquarters and production facility in Selangor. He said this move was necessary considering the existing offices and facilities have been fully utilised. 'One of our key goals is to centralise our office operations, as we currently do not have enough space. 'The funds raised will allow us to bring everyone together under one roof, expand our production facilities and purchase new machinery to increase our production,' he said at a press conference after the launch of SAG's prospectus here yesterday. The company has earmarked RM88mil, or 54.6% of the total proceeds, for the new corporate and production facility. An additional RM12mil would be used to establish and expand brand offices in Penang and Johor. According to Chang, the regional expansion was for capturing business opportunities for interior fitting-out services in the two states as well as strengthening the company's market presence in the northern and southern regions of Peninsular Malaysia. SAG would also allocate RM30.1mil for working capital requirements and RM4mil for the acquisition of new machinery and equipment. The remaining proceeds would be used for the repayment of bank borrowings at RM20mil and to cover listing-related expenses at RM7.1mil. Addressing concerns about the subdued performance of recent ACE Market listings, Chang expressed confidence in SAG's fundamentals and business outlook. 'For the past four financial years ended Dec 31, 2021 (FY21) to FY24 and up to April 16, 2025, SAG has completed 624 interior fitting-out projects with a combined value of RM391.6mil. 'As at April 16, 2025, the company had 69 ongoing projects with a total contract value of RM902.4mil and an unbilled contract value of RM388.6mil or 43.1% of the total value,' he said. In FY24, SAG posted a net profit of RM40.56mil, an increase from RM10.42mil recorded in FY23. Revenue also more than doubled in FY24, rising to RM386.02mil from RM173.38mil in the previous year. On external market pressures, particularly tariffs imposed by the United States, Chang noted minimal impact on operations. He attributed this to SAG's reliance on locally sourced raw materials instead of imported. 'And unlike other construction companies, we use different types of materials for our interior fitting-out services,' he added. SAG specialises in interior fitting-out services and building construction, with Signature International Bhd holding a 50.7% stake and indirectly controlled by construction outfit Chin Hin Group Bhd . Following the IPO, Signature International's stake would be diluted to 37.5%, while the combined shareholdings of Chang, northern region CEO Foo Khai Shin, and central region CEO Ng Mun Moh would be reduced to 36.5% from 49.3%. Applications for the shares are open and will close on May 21, 2025 at 5pm.
The Star
14-05-2025
- Business
- The Star
ACE Market-bound Signature Alliance aims to raise RM161.2mil from IPO
From left: Affin Hwang IB head of equity capital markets Arvin Chia, Signature Alliance Group shareholder Melvin Ng, executive director Mario Foo, group CEO Darren Chang, shareholder Datuk Seri Chiau Beng Teik, shareholder Chiau Haw Choon, M&A Securities managing director Datuk Bill Tan, head of corporate finance Gary Ting, Chin Hin Group group chief financial officer Michael Lim and Signature Alliance Group director Lau Kock Sang. KUALA LUMPUR: Interior fitting-out specialist Signature Alliance Group Bhd (SAG) aims to raise RM161.2 million through its initial public offering (IPO), ahead of its scheduled listing on the ACE Market of Bursa Malaysia Securities Bhd on June 5, 2025. The IPO involves the issuance of 260 million new shares at an issue price of 62 sen per share. Of the total proceeds, SAG said RM88 million (54.6 per cent) will be used to establish a new corporate office and production facility in Selangor to increase automation and enhance project delivery, while RM30.1 million (18.7 per cent) will be allocated for working capital to support its interior fitting-out projects. The remainder of the funds will go towards repaying bank borrowings (RM20 million), establishing branch offices in Penang and Johor (RM12 million), acquiring machinery and equipment (RM4 million), and covering listing expenses (RM7.1 million). Executive director and group chief executive officer Darren Chang said the expansion is necessary, as the company's existing factories in Bandar Baru Bangi and Puchong are no longer sufficient to support its growing operations. "One of our key goals is to centralise our office operations, as we currently do not have enough space. "The funds raised will allow us to bring everyone together under one roof, expand our production facilities, and invest in new machinery to increase our production capacity,' he said at a press conference held in conjunction with the company's prospectus launch. Chang added that despite the underperformance of several recent ACE Market debutants due to challenging market conditions, the company is confident in its ability to deliver strong results. In a separate statement, the company said that for the financial years ended Dec 31, 2021, to Dec 31, 2024, and up to April 16, 2025, SAG had completed 624 interior fitting-out projects, with a total value of RM391.6 million. "As of April 16 this year, the company has 69 ongoing projects with a total contract value of RM902.4 million and unbilled contract value of RM388.6 million or 43.1 per cent of the total," it said. The IPO is open for subscription from today to May 21, 2025. M&A Securities Sdn Bhd is the adviser, sponsor, managing underwriter, joint underwriter and joint placement agent, while Affin Hwang Investment Bank Bhd is the joint underwriter and joint placement agent for the IPO. - Bernama
The Star
01-05-2025
- Business
- The Star
Bonia faces soft near-term sales on weak demand
Affin Hwang IB expects Bonia's sales growth to remain flattish in the near term. PETALING JAYA: Muted sales are anticipated for luxury fashion retailer Bonia Corp Bhd in the near term due to weaker sales volume amid current global economic conditions. According to Affin Hwang Investment Bank (Affin Hwang IB), the brand also faces difficulties in raising its product prices. The group posted a 12% decline in sales to RM188.2mil for the first half ended Dec 31, 2024 (1H25), due to weaker sales in both the Malaysian and Singaporean markets. Both markets have recorded negative sales growth since the fourth quarter of financial year 2023 (4Q23), with the decline in 1H24 primarily due to a high base effect in the same period last year, where the group benefited from economic recovery and revenge spending by the consumers. The negative growth was most likely due to the broader economic environment rather than company-specific issues. Affin Hwang IB also noted that Bonia's core earnings of RM8.1mil came in below both its and consensus full-year expectations, accounting for just 31% and 29%, respectively. 'The earnings miss was driven by lower-than expected sales and higher-than-expected operating costs, primarily from selling and distribution costs,' it added. The research house expects Bonia sales growth to remain flattish in the near term with sales growth of 0.4% to 4% in financial year 2025 (FY25) to FY27, with potential downside risks that could further impact performance – particularly if economic uncertainties, such as US tariffs, weigh on the broader economy. 'We estimate Bonia's upcoming 3Q25 results, which is likely to be reported in late May, to come in within the range of RM10mil to RM12mil range. 'This represents a stronger year-on-year net earnings growth, driven by higher sales, partly due to an earlier Hari Raya celebration this year,' it noted. Affin Hwang IB added that net margin, however, is expected to remain flat at 11% to 12% in 3Q25 due to cost pressures. While Malaysian consumers are expected to remain cautious with spending on big-ticket items such as Bonia products – which have an average basket size of RM800 to RM1,000 – the research house believes sales could be slightly supported by favourable government policies. However, the retail outlook in Singapore remains bleak. In light of lower growth forecasts and sustained negative growth in discretionary spending, Bonia's sales performance in the Singapore market is expected to face further downside in the near term. 'In response to this, we gather that the management is likely to close non-performing stores across Singapore to safeguard margins. 'This move should result in modest cost savings through reduced rental and labour costs, easing margin pressure from subdued sales in Singapore,' it added. Bonia also plans to reduce its advertising and promotional expenses, with no major marketing events scheduled for the near term. Instead, the group will focus on more strategic marketing activities involving influencers to enhance brand exposure. Affin Hwang IB upgraded its recommendation on Bonia to a 'hold', with a higher target price of RM1.17 per share.
