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The Sun
23-05-2025
- Business
- The Sun
Eco-Shop Marketing targets 15-20% revenue, Patami growth in 2025
KUALA LUMPUR: Eco-Shop Marketing Bhd is targeting growth of 15%–20% in revenue and profit after tax and minority interest (Patami) in 2025, supported by business volume and consumer demand, despite recent price adjustments. Chief financial officer Chong Yew Kai said the company observed no negative reaction when it raised product entry prices from RM2.40 to RM2.60 last month. 'In terms of not only revenue but also Patami, we are looking at 15% to 20% of growth year-on-year. Last round we had this price increase in 2022. So similar trends. Things are moving as per our expectation,' he told a press conference after the company's listing on the Main Market of Bursa Malaysia today. CEO Jessica Ng said the listing marks a new chapter for the household products retailer, enabling it to scale growth and strengthen its market position. 'With enhanced capital, we are now better positioned to expand our nationwide footprint, strengthen our warehousing and distribution capabilities, and invest in technology to enhance operations and customer experience – all while staying true to our promise of delivering unbeatable everyday value.' She said Eco-Shop's business model is built on high volume and scale, which enables it to achieve operational efficiency while keeping prices ultra-affordable. Ng noted that about 75% of the company's products are house brands, many of which are custom-packaged in smaller quantities to maintain affordability and variety. 'We buy in bulk and break them down into smaller packs – like our sachet drinks – making them more accessible to our customers. Our focus remains on daily essentials and basic home living needs.' To enhance customer experience, Ng said, Eco-Shop has refreshed its store image and layout to provide a more comfortable and enjoyable shopping environment. Eco-Shop plans to open 70 new stores annually, including five to six outlets under its Ecoplus brand, a premium retail concept aimed at urban markets and located in shopping malls. Ecoplus offers an expanded range of products beyond the standard RM2.60 price point, with options priced at RM6, RM10 and RM20. Ng said the company is open to future expansion into the Asean market, although its current focus remains on Malaysia. 'The dollar shop segment is still relatively new in Asia. Outside of mature markets like the US and Japan, there's a lot of room to grow. We're the first in this segment to list, and if the opportunity arises, we will evaluate it.' Eco-Shop made its debut on the Main Market at RM1.25 with a 12 sen premium over its initial public offering (IPO) price of RM1.13, with 25 million shares traded. It closed at RM1.20, up 6.19% from its IPO price, with over 209 million shares changing hands, making it one of the most actively traded counters. The IPO raised RM419.87 million for Eco-Shop, whichhas allocated RM56.27 million (13.4%) to accelerate the expansion of its retail footprint nationwide, RM200 million (47.6%) to expand its distribution centres, RM10.90 million (2.6%) for investment in information technology hardware and software, RM100 million (23.8%) to repay bank borrowings and RM52.7 million (12.6%) for working capital purposes and to defray the cost of the IPO and listing. Eco-Shop's Patami has grown at a compounded annual growth rate of 156% over the last three financial years from May 31, 2022 to 2024. The company recently reported Patami growth of 36% year-on-year for the nine months ended Feb 28, 2025. Maybank Investment Bank Bhd is the principal adviser, joint global coordinator, joint bookrunner and sole underwriter for the IPO. UBS Securities Malaysia Sdn Bhd and UBS AG, Singapore branch, are joint global coordinators and Joint bookrunners, while RHB Investment Bank is also a joint bookrunner.
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.
Business Times
23-05-2025
- Business
- Business Times
Eco-Shop jumps on debut, minting a new Malaysian billionaire
[KUALA LUMPUR] Shares of discount-chain Eco-Shop Marketing gained on their debut on Friday (May 23) as Malaysia's biggest initial public offering of the year created a billionaire. The stock jumped as much as 10.6 per cent in early trading, before paring gains to close 6.2 per cent higher at RM1.20. Eco-Shop, which sells household items at a fixed price of RM2.60 (S$0.79), raised RM974 million in an offering that valued the company at about US$1.5 billion. That's the most since an IPO by 99 Speed Mart Retail Holdings in September. The time could not have been better for Eco-Shop, according to chief executive officer Jessica Ng. 'If you look at the current economic situation, our business model is even more needed. We stretch the ringgit for many, many people,' Ng said in a Bloomberg News interview. Potential income growth for most of the population over the next two years would also ensure 'a big catchment' and room to expand, she added. The US dollar-store operator plans to use proceeds from the share sale to add 70 outlets per year for the next five years, essentially doubling its store count. The debut is a positive sign for Malaysia's market, whose momentum after the 55 IPOs it saw in 2024 was derailed by tariffs. Although Eco-Shop's IPO shares were eventually priced lower, the listing shows there is still traction for low-cost mass consumer brands among investors. Founded by Lee Kar Whatt and his partners in 2003, Eco-Shop has grown to 350 stores across Malaysia. Lee – who will end up with a US$1.15 billion stake post-listing, according to the Bloomberg billionaires Index – still works out of the company's headquarters in Jementah, a small town located in the southern state of Johor. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The company is looking to expand the portfolio of its in-house brands, which make up more than half of sales, to have better control over cost and quality. Ng said the group also has mechanisms in place that allow it to keep the cost of imported products at a minimum. Eco-Shop, which sells everything from snacks to stationery and cleaning products, reported a 45 per cent on-year increase in net profit to RM61.7 million for the three months through February. Revenue jumped 17 per cent to RM736 million. No doubt, competition has intensified in recent years, particularly from established rivals like Mr DIY Group (M) and smaller upstarts run by entrepreneurs from mainland China. But Ng said Eco-Shop can carve out its own niche, given its 68 per cent market share in the country's discount-store sector. Ng, who previously worked at multinationals, said Malaysian brands are generally 'operationally good' and many of them have become 'irreplaceable' due to the scale they have achieved in their respective categories. Resilient domestic demand will continue to help local chains like Eco-Shop thrive, she said. BLOOMBERG
Business Times
22-05-2025
- Business
- Business Times
Dollar-store billionaire poised to emerge from Malaysia IPO
[KUALA LUMPUR] A discount chain with signature red storefronts has drawn legions of Malaysians looking for good deals – and made its founder a billionaire. Eco-Shop Marketing, which operates more than 350 dollar stores across Malaysia, is on track to complete its initial public offering (IPO) in Kuala Lumpur on Friday (May 23) – the country's biggest this year. The listing will value the company at about US$1.5 billion, meaning its founder and controlling shareholder, Lee Kar Whatt, will end up with a US$1.15 billion stake, according to the Bloomberg Billionaires Index. Eco-Shop's growth over the last two fiscal years, with revenue increasing more than 50 per cent, reflects the demand for cheap everyday goods at a time of rising inflation, said Zhu Hann Ng, founder and chief executive officer of Tradeview Capital, a fund manager in Kuala Lumpur. 'Fixed-price retailers became a first choice,' Hann said, referring to the RM2.60 (S$0.61) price tag on all products in Eco-Shop stores in peninsular Malaysia. (Products sold in Malaysia's two states on Borneo cost RM2.80.) Lee, who's 51, will remain in charge. He declined to be interviewed. He opened the chain's first store in 2003 with his brother and a pair of other people. He still works out of the company's headquarters in Jementah – a small town that's a three-hour drive southeast of Kuala Lumpur. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up Even before Eco-Shop grew into a nationwide chain, Lee was well-known in the Chinese-Malaysian business community for his charitable engagements, Hann said. In 2023, Lee was captured on a rare photo handing a RM1 million check to the Turkish ambassador to Malaysia, meant for the victims of the earthquakes that devastated parts of southern Turkey. Creador, a private equity firm, took a 10 per cent stake in the company in 2019, at which point it had more than 100 stores. But Eco-Shop faces competition from established rivals, such as Mr DIY Group (M), as well as smaller upstarts run by entrepreneurs from mainland China, Hann said. 'We feel the market in Malaysia is quite saturated' and the company's 'upside is capped', he said. Tradeview declined to buy Eco-Shop shares as part of the offering. For its part, Eco-Shop says in its prospectus that there's significant room to grow. It plans to open approximately 70 new stores annually for the next five years. BLOOMBERG
Straits Times
22-05-2025
- Business
- Straits Times
New Malaysian billionaire set to emerge from dollar store chain Eco-Shop's IPO
Eco-Shop Marketing is on track to complete its initial public offering in Kuala Lumpur on May 23 – the country's biggest in 2025. PHOTO: KUALA LUMPUR - A discount chain with signature red storefronts has drawn legions of Malaysians looking for good deals – and made its founder a billionaire. Eco-Shop Marketing, which operates more than 350 dollar stores across Malaysia, is on track to complete its initial public offering in Kuala Lumpur on May 23 – the country's biggest in 2025. The listing will value the company at about US$1.5 billion (S$1.9 billion), meaning its founder and controlling shareholder, Lee Kar Whatt, will end up with a US$1.15 billion stake, according to the Bloomberg Billionaires Index. Eco-Shop's growth over the last two fiscal years, with revenue increasing more than 50 per cent, reflects the demand for cheap everyday goods at a time of rising inflation, said Ng Zhu Hann, founder and chief executive officer of Tradeview Capital, a fund manager in Kuala Lumpur. 'Fixed-price retailers became a first choice,' Mr Ng, referring to the RM2.60 price tag on all products in Eco-Shop stores in peninsular Malaysia. Mr Lee, who's 51, will remain in charge. He declined to be interviewed. He opened the chain's first store in 2003 with his brother and a pair of other people. He still works out of the company's headquarters in Jementah – a small town that's a three-hour drive south-east of Kuala Lumpur. Even before Eco-Shop grew into a nationwide chain, Mr Lee was well-known in the Malaysian Chinese business community for his charitable engagements, Mr Ng said. In 2023, Mr Lee was captured on a rare photo handing a RM1 million cheque to the Turkish ambassador to Malaysia, meant for the victims of the earthquakes that devastated parts of southern Turkey. Creador Sdn., a private equity firm, took a 10 per cent stake in the company in 2019, at which point it had more than 100 stores. But Eco-Shop faces competition from established rivals, like Mr DIY Group, as well as smaller upstarts run by entrepreneurs from mainland China, Mr Ng said. 'We feel the market in Malaysia is quite saturated' and the company's 'upside is capped,' he said. Tradeview declined to buy Eco-Shop shares as part of the offering. For its part, Eco-Shop says in its prospectus that there's significant room to grow. It plans to open approximately 70 new stores annually for the next five years. BLOOMBERG Join ST's Telegram channel and get the latest breaking news delivered to you.
