Daythree Digital Bhd (Daythree Digital) enters the ACE-market with an opening price of 65 sen on Wednesday (July 26), a premium of 116.67% over its initial price offering (IPO) price of 30 sen per ordinary share.
At the morning gong, the tech-driven global business services provider saw 93.38 million shares traded. At 30 sen per share, the group is expected to have a market capitalisation of RM144 million post-IPO, valuing the company at about 23.1 times based on its net profit of RM6.2 million for the financial year ended Dec 31, 2022 (FY2022).
Previously, Daythree’s shares had been oversubscribed by 129.20 times valuing the company close to RM1 billion. The Bumiputera public portion of shares was oversubscribed by 112.82 times, after a total of 13,004 applications for 1.37 billion new shares received.
For the remaining public portion, a total of 11,049 applications for 1.76 billion new shares were received, which represents an oversubscription rate of 145.59 times.
Meanwhile, the 12.00 million new shares for its eligible Directors and employees of Daythree Digital Group under Pink Form Allocations have also been fully subscribed. Raymond holds 36% in the company through Dayspring Capital Sdn Bhd from 50% pre-IPO, followed by Cloud Marshal Sdn Bhd with an equity stake of 23.1%, from 30%.
“There is a strong desire to attain a digital economy, which will lead to more businesses adopting digitisation in their operations, and thus leading to increased demand for GBS services,” said Raymond.
“This is where Daythree Digital comes in. We see ourselves as a tech company, providing tech enabled services for the brands we serve. With proficient understanding of new technologies, we help brands use cutting-edge technologies to deliver innovative and impactful customer experience, and achieve their brand loyalty objectives,” he added,” he added.
To recap, the company plans to use RM14.70 million (44.4%) raised from the initial public offering (“IPO”) for working capital requirements to recruit additional 380 customer experience (“CX”) executives to enhance its capacity to service growing number of contracts.
In tandem with the expansion, it will enter into a lease contract for rental of 380 units of computer equipment per CX executive. A total of 380 CX executives will be recruited to service multiple sectors including energy and utilities, telecommunications and media, fintech, and financial services, construction, e-commerce and retail, healthtech as well as travel and hospitality.
A further RM7.10 million (21.4%) of the proceeds will be used to part finance the additional working space required for its growing customer base and the expansion of its headquarters to cater for the rising number of employees as well as to set up a multipurpose facility for internal training and meetings.
The remainder of the proceeds will be used for capital expenditure in networking infrastructure, hardware and software amounting to RM3.00 million (9.1%); RM3.02 million (9.1%) to recruit industry experts to capture growth opportunities in the local GBS industry; RM1.50 million (4.5%) for branding, marketing and promotional activities while the remaining RM3.80 million (11.5%) to defray the estimated listing expenses.
Since Daythree Digital’s clients are looking at regional brands as well, the listing would attract potential foreign talents as well.
“The recent brands that we have on-board are looking at regional brands. We are beginning to hire more foreign knowledge workers, people with language capabilities like Japanese and Korean. We are using the IPO as a platform to attract regional brands and we do see that there will be a surge of new hiring of more and more foreign talents to work alongside our local talents as well,” he said.
M & A Securities Sdn Bhd is the Adviser, Sponsor, Underwriter, and Placement Agent for the IPO exercise. According to Bursa Malaysia at noon, the stock value of Daythree Digital closes at RM0.63 with a share volume of 1.25 million.
