Vanzo Holdings Berhad, a Malaysian air fragrance company, is set to list on the ACE Market of Bursa Malaysia on December 17, 2024. Below is a comprehensive overview of the IPO details:
IPO Details:
The IPO is priced at RM0.15 per share, with a total of 140,026,000 shares offered (93,351,000 new shares and 46,675,000 existing shares), aiming to raise approximately RM21 million. Post-IPO, the company’s market capitalization is expected to be around RM70 million. The substantial offering size relative to market capitalization suggests a strong capital base, which could support favorable trading dynamics on the first day.
The IPO comprises a public issue of 93.35 million new shares and an offer for sale of 46.68 million existing shares. The allocation includes 23.34 million shares for the Malaysian public, 23.34 million shares for eligible directors, employees, and contributors, and 46.68 million shares via private placement to selected investors. The participation of selected investors in the private placement indicates institutional interest, suggesting a positive reception. There is no information indicating that any investors sold shares before the listing.
Subscription Period: Opened on November 27, 2024, and closed on December 4, 2024, at 5:00 PM.
IPO Allotment
The allotment date for the IPO shares is scheduled for December 13, 2024. Specific details regarding the allotment results have not been disclosed. The level of oversubscription and investor demand will be clearer post-allotment, providing better insights into potential first-day performance.
Company Overview:
Principal Activity: Vanzo Holdings Berhad specializes in the design, marketing, and sale of air fragrance and fragrance-related products under its own brand, “Vanzo.” The company’s product range includes 12 car and indoor fragrance series, developed in collaboration with outsourced manufacturers. Notably, Vanzo owns the formulations for 12 of its 28 scents.
BURSA MALAYSIA
Use of Proceeds:
Managing Director: Allan Wong, who has indicated plans to open four new kiosks in different states by 2026, including Sabah, Johor Bahru, Penang, and locations within the Klang Valley.
The company plans to utilize the RM14 million raised from the IPO as follows:
Business Expansion and Marketing Activities: 47.2% of the proceeds will be allocated to setting up four new retail kiosks across Malaysia to enhance brand visibility and expand the customer base.
Repayment of Bank Borrowings: 21.4% will be used to repay existing bank loans.
Working Capital: 5% is earmarked for general working capital needs.
Listing-Related Expenses: 26.5% will cover expenses associated with the listing process.
Risk Factors:
Potential investors should consider risks such as market competition, reliance on outsourced manufacturers, and the company’s ability to maintain and develop new fragrance formulations. Additionally, the success of the planned retail expansion is contingent upon market acceptance and effective execution.
Contemporaneous IPOs
Other companies filing for listings around the same period include Winstar Capital Berhad, TMK Chemical Berhad, and Topvision Eye Specialist Berhad. The performance of these IPOs can offer context regarding market sentiment and investor appetite during this timeframe.
M&A Securities Sdn Bhd serves as the principal adviser, sponsor, underwriter, and placement agent for Vanzo’s IPO. The involvement of a reputable firm like M&A Securities is a positive indicator, potentially enhancing investor confidence and contributing to favorable first-day trading performance.
The prospectus for Vanzo Holdings Berhad’s IPO can be downloaded from Bursa Malaysia’s official website: Vanzo Holdings Berhad Prospectus.
Considering the company’s established market presence, strategic expansion plans, and the positive indicators from institutional participation, subscribing to Vanzo’s IPO appears to be a promising opportunity. Given the favorable market conditions and the company’s growth prospects, it is estimated that the stock could trade between RM0.16 to RM0.18 on the first day, reflecting a 6.7% to 20% premium over the IPO price. The stock is likely to trade mildly above the IPO price, contingent upon overall market sentiment and investor demand.
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