KUALA LUMPUR: Ahead of its initial public offering (IPO), Big Caring Group Bhd (BCG) is prioritising balance sheet consolidation, with the planned repayment of RM500mil in borrowings expected to lower its gearing ratio and free up financial capacity to support retail network expansion.
Yesterday, Malaysia’s largest pharmacy retailer launched its prospectus for its Main Market listing on Bursa Malaysia on Nov 19, 2026.
Based on its enlarged share capital of 7.4 billion ordinary shares and the maximum IPO price of RM1.08 per share, BCG is expected to have a market capitalisation of approximately RM8bil upon listing.
The IPO comprises an offering of up to 1.9 billion ordinary shares, consisting of a public issue of 590.5 million new shares and an offer for sale of 1.3 billion existing shares.
These represent 8% and 17.5% of its enlarged share capital, respectively.
At the maximum IPO price, the public issue is expected to raise gross proceeds of approximately RM637.8mil.
Of the proceeds, 4.7% will be allocated towards establishing a new distribution centre within 36 months of listing to expand capacity, as the group’s existing Bukit Raja distribution centre was operating at 80.2% utilisation as at Sept 30, 2026.
In addition, nearly 90% of the proceeds will go towards repaying bank borrowings within three months of listing.
At the launch, BCG group chief financial officer Chin Shin Yi said the group expects to generate RM26.3mil in interest savings following the repayment of RM500mil in loans, based on its average borrowing cost of 4.6% in the financial year ended 2026.
The repayment is also expected to reduce the group’s gearing ratio to slightly below one times from 2.8 times as at Aug 31, 2026.
“After the repayment of the RM500mil in borrowings, we anticipate the ratio to decline to slightly below one times,” she said.
BCG also targets a dividend payout ratio of up to 50% of its net profit attributable to owners, subject to factors including its cash position, gearing, return on equity, capital expenditure requirements, restrictive covenants and working capital needs.
On sustaining the dividend policy, BCG group managing director and group chief executive officer Lee Meng Chuan said the actual payout would depend partly on the group’s cash flow and potential acquisition opportunities.
“Any acquisition must have a clear rationale, where one plus one is greater than three.
“If we identify the right opportunity, we will pursue it. In such cases, the dividend payout may be lower, depending on our cash flow, but the acquisition could benefit the company’s long-term growth,” he said.
In a statement, the group noted more than 600 outlets nationwide, through organic expansion and strategic acquisitions.
“As we continue to expand our pharmacy network and deepen our vertically integrated capabilities, we remain focused on putting care within reach of communities across Malaysia while delivering sustainable long-term value to our customers, employees and shareholders,” Lee said.
Looking ahead, BCG targets to open 40 to 50 new outlets annually over the next three to five years, while maintaining same-store sales growth or SSSG of 7% to 9%.
BCG director Livia Chan Lih Wen said much of the group’s demand continued to be driven by structural factors, with SSSG remaining healthy at high single-digit levels.
“We have also seen strong growth across all categories, including healthcare, pharmaceuticals and supplements.
“Average transaction counts and basket values across our stores have also been growing strongly, reflecting underlying structural demand,” she said.
On cost pressures and consumer affordability, management said the group would continue to leverage its integrated ecosystem and improve operational efficiency to mitigate rising costs and limit the impact on consumers.
“Through operational efficiency improvements, we have done our best to contain costs,” executive director Lim Sin Yin said.
“It has always been our principle to make healthcare more accessible. This includes offering competitive prices, supported by our large procurement team, which works hard to ensure consumers have a wide range of products and options to choose from,” she added.
