Solar PV firm Pekat Group's public offer shares oversubscribed 76 times


The offer price was 32 sen per share and it recorded RM794.50mil for the shares worth RM10.30mil under its public portion.

KUALA LUMPUR: Solar photovoltaic (PV) and earthing and lightning protection (ELP) specialist Pekat Group Bhd’s offer of 32.20 million new shares each to the public recorded overwhelming demand.

It said on Monday the shares were oversubscribed by 76 times after a total of 34, 963 applications for 2.5 billion shares were received from the public when it was open for subscription from June 2 to 10.

The offer price was 32 sen per share and it recorded RM794.50mil for the shares worth RM10.30mil under its public portion.

“The RM794.50mil in subscription amount received was the highest since 2019 and surpassed the previous records set by Volcano Bhd and Flexidynamic Holdings Bhd, which pulled in RM512.8mil and RM444.90mil respectively, in subscription earlier this year, ” it said.

The Bumiputra portion of shares was oversubscribed by 44 times after 13, 168 applications for 725.5 million shares were received.

There were 21, 795 applications for the remaining public portion amounting to 1.8 billion shares, an oversubscription rate of 108.0 times.

The 16.1 million new shares for its eligible directors and employees as well as persons who have contributed to the success of Pekat had also been fully subscribed.

The placement agent has also confirmed all the private placement and offer shares to selected investors and identified Bumiputera investors approved by the Ministry of International Trade and Industry by way of private placement to selected investors have been fully placed out.

Pekat managing director Chin Soo Mau said the company aims to grow its order book for solar PV division’s contribution to the group’s revenue to between 60% and 70% in the current financial year ending Dec 31, 2021.

About two-thirds of its orderbook is from the solar PV division, which would provide a steady revenue stream for the group. Its orderbook comprised unbilled contracts amounting to RM154.90mil for both the solar PV, and the ELP divisions as at May 3.

Pekat will tap into the RM1 billion local solar market with potential jobs this year, driven mainly from the Net Energy Metering (NEM) 3.0 programme.

“So far, we have secured over 22 megawatt (mw) under the net offset virtual aggregation (NOVA) programme for commercial premises under NEM 3.0, and we are applying for more, as we aim to achieve 10% share from the total 300 mw quota allocated for commercial premises, ” he added.

NEM 3.0 is a new solar rooftop initiative by the government to encourage more companies to install the solar PV systems on the roofs of their buildings to reduce their electricity bills.

The programme, which offers a quota of 500 mw from 2021 to 2023 have three new programmes – NEM Rakyat, Nem GoMEn and NOVA. 3.

Managing director of corporate finance at M&A Securities Sdn Bhd, Datuk Bill Tan said, the strong demand for green energy-focused companies reflect the shift in investor sentiment towards Environmental, Social and Governance (ESG) companies especially solar power.

“M&A is indeed pleased to be able to help Pekat in its listing and we also strongly believe in the growth of Pekat and its niche in the green energy especially solar power, ” he added.

Under the listing exercise, Pekat issued 138.7 million new shares or about 21.5% of the enlarged share capital at an issue price of 32 sen per share.

Pekat intends to use the IPO proceeds of RM44.4mil to expand its businesses by securing more contracts, concurrently carrying out projects, and providing more maintenance services. The company should continue to see contract flows given its 11-year track record in the industry.

The solar EPCC business has benefitted greatly from the various government programmes in place, including the Net Energy Metering (NEM), to accelerate solar energy adoption. Solar PV demand will continue to remain high as the world continues to adopt renewable energy.

Pekat’s listing on the ACE Market of Bursa Securities is tentatively scheduled on June 23.

M&A Securities Sdn Bhd is the adviser, sponsor, underwriter and placement agent for the IPO exercise.

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