DXN Holdings Bhd (DXN) debut on the Main Market of Bursa Malaysia Securities Berhad with a share price opening at RM0.69 below its IPO price of RM0.70 and analysts’ target of RM0.95. The organisation is listed under the stock code: 5318 / DXN
DXN successfully raised a total of RM112.0 million in proceeds through its retail offering. Of the total proceeds raised, RM80.0 million has been allocated for the repayment of bank borrowings while RM7.9 million is earmarked for working capital requirements, mainly for the purchase of primary raw materials used to produce finished goods and primary packaging materials. Another RM24.1 million of the total proceeds raised will be utilised to defray fees and expenses for DXN’s initial public offering (“IPO”) and listing on the Main Market of Bursa Malaysia Securities Berhad.
Speaking at the listing ceremony, DXN Non-Independent Executive Chairman and Founder, Datuk Lim Siow Jin said, “We are pleased with the successful listing of DXN on the Main Market of Bursa Malaysia Securities Berhad. As DXN embarks on this new journey, we believe this listing will open up new opportunities for our business, allowing us to further enhance our corporate visibility and access to new markets. This is a significant milestone for DXN, and we look forward to the many growth opportunities that will accompany it.”
Based on DXN’s enlarged issued ordinary shares of 4,985,000,000 and the opening price of RM0.69, DXN’s market capitalisation works out to be approximately RM3.4 billion. DXN also intends to declare a yearly dividend with a target payout ratio of between 30%-50% of its profit attributable to its owners on a consolidated basis.
Maybank Investment Bank Berhad is the Principal Adviser, Joint Global Coordinator, Joint Bookrunner, Joint Managing Underwriter and Joint Underwriter for the IPO. CIMB Investment Bank Berhad is the Joint Global Coordinator, Joint Bookrunner, Joint Managing Underwriter and Joint Underwriter for the IPO. CLSA Limited and CLSA Securities Malaysia Sdn Bhd are the Joint Global Coordinators and Joint Bookrunners for the IPO whereas RHB Investment Bank Berhad is the Joint Bookrunner and Joint Underwriter for the IPO.
Towards the future, the organisation seeks to continue the expansion of its vertically-integrated global supply chain, and shall move into new markets such as Latin America and Africa. Countries within these regions are such as Brazil, Argentina, Ghana, Algeria and Egypt. The next three to five years shall also witness DXN’s foray into the China market through web marketing, due to difficulty in procuring a licence in the market. Being consumer and member focused, engagements shall be backed by a track record of 452 SKUs.
According to Lim, companies in the past two years have adjusted their share prices in the range of 20 to 30 percent, while DXN was able to stabilise it at 6 to 7 percent due to their status as a manufacturer. DXN further recorded about a 38.8% increment in sales compared to last year. He added that the year 2022 had been a challenging year, with issues such as higher logistic costs, inflation and adjustment to salary. Regardless of the economic landscape, DXN posts a profit increase of 17.2%.
