PETALING JAYA: Making its debut on the ACE Market of Bursa Malaysia at 27 sen per share, Mercury Securities Group Bhd has a positive outlook for the next few years to come.
This is following the recent slowdown in the groups earnings, which for the third quarter of 2023 ended July 31, 2023 (3Q23) recorded revenue of RM7.26mil as well as a net profit of RM3.73mil.
Mercury Securities managing director Chew Sing Guan said the group is fortunate to obtain other income streams, especially in corporate finance, despite other stock brokers having seen a dip in the market.
“By 4Q23, we should be able to come back up because of the initial public offering (IPO),” he told StarBiz after the listing ceremony.
Chew said average daily volume has also gone up by around 30% this year, following the improvement of the market volume since the implementation of stamp duty reduction.
He explained that for financial year 2024, Mercury Securities will see an improvement as market volume continues to come up as well as the strong IPO pipeline.
“Now we can unleash our cash balances and as for new cash coming in, that will go towards more lending. This is an easy win because a lot of companies and investors need at least one margin financing,” Chew said.
On a side note, he said all segments including stock broking and corporate finance will contribute to the group’s earnings moving forward.
Chew said in order to remain competitive within the market, Mercury Securities must adapt to the ever changing digital landscape, through the incorporation and constant upgrade of mobile systems as well as in-house technology.
“Everybody has handphones and they want to do everything with their handphones. So moving forward, we need to put through a lot more automation to ensure smoother operations,” he said.
With that, Chew said the group plans on introducing new features and products to the table, such as robo-advisers and algorithm trading software.
He said Mercury Securities has always been competitive within the market and despite the ups and downs, the group has been profitable every year.
“We have the right mix of products and people and how we are going to continue is of course by not only competing amongst ourselves, but also against the technological challenges,” he said.
On top of more technological advances, Chew said Mercury Securities will be introducing more products and services and possibly go beyond the Malaysian market.
Mercury Securities will be expecting an additional three or four more IPOs in the pipeline for this year, with Evergreen Max Cash Capital Bhd slated to be listed on the ACE Market of Bursa Malaysia on Sept 26, 2023, followed by Smart Asia Chemical Bhd.
He said the other companies could not be disclosed due to confidentiality.
Mercury Securities’ listing on the ACE Market is one of the first local stock brokers in two decades to float its shares.
Its debut at 27 sen per share represents a premium of 8% over the initial IPO price of 25 sen per share.
At 5pm, the stock rose five sen to 30 sen. It was the third most actively traded stock with 219.99 million shares traded.
The stockbroking and financial services provider raised a total of RM39.27mil from its IPO exercise, of which RM26.86mil will go towards margin financing facilities, while RM2.88mil has been allocated for the enhancement of digitalisation programme and marketing activities.
The remaining RM4.63mil will be used for working capital and RM4.90mil is allocated for listing expenses.