From left: Minox International Group Bhd executive director Looi Poo Poo, managing director Cheong Chee Son, M&A Securities Sdn Bhd managing director Datuk Bill Tan and corporate finance head Gary Ting at the underwriting agreement ceremony of Minox International Group Bhd in conjunction with its initial public offering on the ACE Market of Bursa Malaysia.
KUALA LUMPUR: ACE Market-bound Minox International Group Bhd
aims to strengthen its presence in the semiconductor industry to further grow the company.
The distributor of stainless steel sanitary valves, tubes and fittings, which is scheduled to be listed on Oct 17, is expected to raise RM22.5mil from its initial public offering (IPO), comprising a public issue of 90 million new ordinary shares at 25 sen each.
It revealed that 57.9% of the total IPO proceeds would be used for growing its business, including product development and deployment; construction of its fourth warehouse in Puchong, Selangor; and setting up of a new warehouse in Singapore.
At the launch of the group’s IPO prospectus yesterday, Minox managing director Cheong Chee Son said the company has charted a three-pronged growth strategy.
“Firstly, we intend to strengthen our presence in the semiconductor industry where we see great potential.
“Through our design and development team, we are set to introduce our new vacuum fittings and valves to be used in semiconductor production lines for makers of electronic components, solar cells, storage media and LED manufacturing plants,” Cheong said.
He said the construction of Minox’s fourth warehouse in Puchong would give the group additional storage space of approximately 18,690 sq ft to support its growing business volume.
He added that the setting up of a new warehouse in Singapore, with an expected storage area of 7,500 sq ft, would further facilitate Minox’s business expansion in the city-state.
“It will provide us with additional capacity to store our new vacuum fittings and valves for the semiconductor industry as well as to store inventories that cater for our customers in Singapore and other overseas market such as Bahrain, Cambodia, Denmark, Germany, India, Japan, South Korea, Myanmar, Sri Lanka, Spain and United Arab Emirates,” Cheong said.
“This new warehouse in Singapore will allow us to store additional inventories, which in turn could lower our average cost per unit by leveraging on Singapore’s free-trade agreements with its trade partners,” he added.
Citing data from independent market research by Protégé Associates Sdn Bhd, Cheong said the outlook for the valves and fittings industry in Asia Pacific was bright, with a projected compounded annual growth rate of 6.1% to US$825.6mil in 2027 from US$643mil in 2023.
Besides allocating funds to grow its business, about 20% of Minox’s IPO proceeds will be used to repay bank borrowings, while 7% will be used to finance working capital and the remainder for listing expenses.
Based on the IPO price of 25 sen per share and its enlarged issue of 360 million shares, Minox’s market capitalisation will be RM90mil upon listing.
In the financial year ended Dec 31, 2022, Minox reported a net profit of RM10.3mil on revenue of RM45mil.
Export sales contributed 63.9% to its revenue, while the food and beverage segment was the largest revenue contributor, accounting for 88.8% of turnover. This was followed by the semiconductor (6.7%) and pharmaceutical industries (4.5%).
