Managing director Er Hock Lai said the group expected to raise RM68.1mil from its initial public offering (IPO) to part-finance the expansion of its annual production capacity by 17% to 166,000 tonnes by 2023 from 142,000 tonnes currently.
KUALA LUMPUR: Rubber processor producer and trader Seng Fong Holdings Bhd
made a flat debut at 75 sen on Bursa Malaysia’s Main Market yesterday with 10.82 million units traded.
The stock ended the day lower at 67.5 sen. It was the most actively traded stock with 97.59 million shares changing hands.
Managing director Er Hock Lai said the group expected to raise RM68.1mil from its initial public offering (IPO) to part-finance the expansion of its annual production capacity by 17% to 166,000 tonnes by 2023 from 142,000 tonnes currently.
Of the total proceeds, he said, RM19.7mil would be used for working capital, RM37.9mil for repayment of bank borrowings, RM6.3mil for the biomass systems installation and the remaining RM4.2mil for listing expenses.“We are now concentrating on the solar and biomass system commissioning as our main environmental, social and governance (ESG) initiatives.
“After completing these two initiatives, we will study other possibilities that can help to contribute to our ESG efforts,” he said during a virtual press conference after the listing ceremony yesterday.
Er said with the new biomass system in place, Seng Fong is looking at cost savings of about RM3.5mil per annum.
“Based on the current diesel price, we believe that the savings will be more than that, about 51% of our diesel cost per annum.
“This is part of our renewable energy (initiative) because we are using woodchips and wood-dust to generate energy for our system instead of using diesel,” he said,
On the rubber industry outlook, Er anticipated the recovery in the global economy post-pandemic would help boost sales for automotive parts and tyres, which would push the demand for rubber. — Bernama
