Latest news with #Eco-Plus
New Straits Times
23-05-2025
- Business
- New Straits Times
Eco-Shop positive about performance despite price hike
KUALA LUMPUR: Household retailer Eco-Shop Marketing Bhd remains optimistic about its performance despite hiking up product prices to RM2.60 from RM2.40 last month. Its chief financial officer Chong Yew Kai said the company raised prices to RM2.40 from RM2.20 in 2022 and saw no negative market reaction. "I see no changes in company performance (after the price increase), it was as per our expectation. So, we are not seeing any different kind of market reaction. "Of course, (we are in) a transition period (now). Moving forward, we are looking at a very strong performance," he told a press conference after today's listing. Recently, Eco-Shop posted a higher net profit of RM61.72 million for the third quarter of its financial year ending Feb 28, 2025 (3Q FY2025), compared to RM42.57 million in the same period a year ago. The revenue increased 17.2 per cent to RM736.35 million in 3Q FY2025 from RM628.41 million previously, driven by the expansion of the group's store network with the opening of 26 new outlets, bringing the total number of stores to 349 in 3Q FY2025 from 278 in 3Q FY2024. Meanwhile, Eco-Shop chief executive officer and executive director Jessica Ng said the company would evaluate their opportunities to venture into the ASEAN market in the future, as the dollar shop segment in the region is still new. Dollar shops offer a wide range of products at fixed, low prices and typically carry daily items like household goods, snacks, and personal care products, and may also include items like stationery and hardware. However, she said the group would likely focus their business expansion in Malaysia for now, so that more Malaysians would have access to affordable products. As of today, Eco-Shop has 358 stores in Malaysia, comprising 336 Eco-Shop stores and 22 Eco-Plus stores. Today, Eco-Shop debuted on the Main Market of Bursa Malaysia at RM1.25, a premium of 12 sen from its initial public offering (IPO) price of RM1.13, with 25 million shares traded. Under its listing exercise, the company had raised RM419.87 million, where RM200 million or 51 per cent would be utilised for distribution centre expansion, RM56.27 million (14.4 per cent) for new store opening, and RM8.52 million (2.2 per cent) for IT hardware and software. "RM100 million or 25.5 per cent would be utilised to repay bank borrowings, and RM27.32 million (7.0 per cent) for IPO and listing expenses," it said. At 5 pm, Eco-Shop closed the day trading at RM1.20, seven sen higher than its issue price of RM1.13, with the company also emerging as the most active stock for the day with 209.16 million shares changing hands.
The Star
09-05-2025
- Business
- The Star
Rising population to lift Eco-Shop's prospects
PETALING JAYA: Eco-Shop Marketing Bhd (Eco-Shop), en route to a listing on the Main Market of Bursa Malaysia, is valued at an initial public offering (IPO) price of RM1.21 per share, implying a price-earnings ratio (PE) of 39.2 times based on the earnings per share (EPS) for its financial year ended May 31, 2024 (FY24) . TA Research said it is benchmarking Eco-Shop against large-scale, store-based domestic retailers in Malaysia. 'Accordingly, we derive a target price of RM1.28 per share, based on a target PE of 25.4 times 2026 EPS, in line with local industry peers,' the research house said. Eco-Shop is the largest chain of affordable household goods in Malaysia, with all products (excluding products at Eco-Plus format stores) priced at RM2.60 for stores in Peninsular Malaysia and RM2.80 for stores in Sabah and Sarawak. The group currently operates 358 stores across the country. The IPO entails a public issue of 347 million new shares and an offer for sale of 515.1 million existing shares, at a retail price of RM1.21 per share, or an institutional IPO price, whichever is lower. Collectively, the share offering represents 15% of the group's enlarged issued share capital, TA Research said. The research house said the group continued to pursue aggressive yet disciplined expansion, supported by positive same-store sales growth over the past two years and a short payback period of approximately one and a half years for new stores opened in the first half of FY25 (1H25). Operational efficiency remains strong, with 98.5% of stores profitable at the earnings before interest, taxes, depreciation and amortisation (Ebitda) level and an average store Ebitda margin of 14.5% in 1H25. Based on an annualised revenue for last year, Eco-Shop commands a dominant 67.8% market share within the segment in Malaysia. Citing independent market research by Frost & Sullivan, TA Research said the affordable-retail segment in Malaysia has experienced significant sales growth, rising from around RM1mil in 2016 to RM4mil last year, growing at a rate of 19.6%. Looking ahead, the affordable-retail segment is projected to grow by 14.2% from 2024 to 2029. 'Furthermore, the Malaysian population grew from 31.6 million in mid-2016 to 33.5 million in mid-2024 and is forecast to reach 35.3 million by mid-2029, reflecting a positive economic outlook. 'Additionally, the store-based retail sector in Malaysia has experienced remarkable expansion,' TA Research said.
