Ranhill closes near day's low on first trading day

Tan Sri Hamdan Mohamad Hamdan said within the next three to five years, Ranhill would expand its wastewater business in China

KUALA LUMPUR: Ranhill Holdings Bhd closed at RM1.01, near the day's low when it made its debut on the Main Market of Bursa Malaysia on Wednesday.

At 5pm, it was down 19 sen to RM1.01 -- which was sharply below its revised initial public offer (IPO) price of RM1.20.

There were 48.02 million shares done at prices ranging from RM1 to RM1.15.

The energy and water company opened at RM1.10 amid a cautious market.

Ranhill priced its IPO at RM1.20 per share, 30% below the indicative IPO price of RM1.70

It had also reduced the issuance of shares to 322 million shares compared with around 475 million when it was originally planned. 

It will raise some RM386mil from the exercise as opposed to the earlier targeted RM637mil.

At the final price of RM1.20 per share, the offer values Ranhill on an earnings multiple of nine to 10 times its financial year 2015 (FY15) earnings, lower than the 14 to 15 times it was hoping to fetch if it got to price its flotation at RM1.70 a share.

Bernama reported Ranhill  is confident of getting more investors onboard with several business expansion plans in the pipeline. 

It quoted president and CEO Tan Sri Hamdan Mohamad as saying that despite the soft market trend, local and international companies continued to seek Ranhill's expertise in making a positive change and contribute to a sustainable future. 

"We would like to focus on expanding our wastewater and power-based businesses in ASEAN countries, especially in Indochina countries. 

"Currently, we are collaborating with a consultant from Thailand to represent us in expanding our business there. 

"At the same time there are companies that are aggressively chasing us to work with them on a long-term basis," he told reporters after Ranhill made its debut on the main market of Bursa Malaysia today. 

Despite the lacklustre debut, Hamdan remained positive about the company's prospects, citing Ranhill's plan to declare between 50% and 70% dividend payout to the shareholders for the financial year 2016. 
 
Hamdan said within the next three to five years, Ranhill would expand its wastewater business in China to 1,000 million litres per day (MLD) from 340 MLD at present. 

It also plans to increase its power plant capacity in Sabah to 1,000 megawatts (MW) from 380MW now. 

"In Sabah, there is shortage of power. In Sandakan alone, there is a need for at least 300MW more of electricity supply," he added.