PETALING JAYA: Shares of MTAG Group Bhd skidded as much as 9.5 sen or 17.9% to 43.5 sen after a strong opening on the ACE Market of Bursa Malaysia today.
The stock surged 17 sen or 32.1% to an intraday high of 70 sen at the opening against the offer price of 53 sen, but was followed by heavy sell-off. At market close, it fell 9 sen or 17% to 44 sen on 288.06 million shares done, giving it a market capitalisation of RM299.91 million.
MTAG is involved in the business of printing and material converting, providing printing of labels and stickers and customised converting services.
The listing exercise raised RM72.3 million, of which RM33 million or 45.6% will be utilised for the acquisition of 10-acre land for the construction of its new manufacturing plant, which will be carried out in two phases.
Some RM13 million or 18% is allocated for capital expenditure involving the purchase of 11 new machineries, which will boost its annual production of labels and stickers to 636.8 million pieces from the current capacity of 324.5 million pieces.
MTAG will also use the IPO proceeds to repay bank borrowings and for working capital.
According to the independent market report by Protégé Associates, the local label printing and converting industry in 2019 is estimated to be RM5.92 billion in 2019. It is projected to grow at a compound annual growth rate of 8.2% to RM8.11 billion by 2023.
