Capital markets executive summary | Tue 17 Oct 2023

Capital markets executive summary | Tue 17 Oct 2023

99 Speed Mart plans IPO in 2H2024

The convenience store chain started as Pasar Raya Hiap Hoe in 1987 before turning into a mini market called Pasar Mini 99. Founder Lee Thiam Wah owns 96% while his wife Ng Lee Tieng holds 4%. There is no publicly available data on the company’s financial performance because it is private exempt. 99 Speed Mart earned RM1b in sales for FY2011 with 300 stores and RM2b in FY2014 with 600 stores. In FY2021, the retailer was estimated to have made RM550m in net profit on RM7b revenue. Its revenue for FY2022 may have been RM8b given that it now has 2,463 stores and looks to hit 2,500 by end-2023. The company may raise RM1.5b from the IPO similar to Mr DIY Group (M) Bhd, which was listed in 2020. The proceeds from the IPO could be used for business expansion into new regional markets such as Singapore, the Philippines, Indonesia and Vietnam. CIMB Investment Bank has reportedly been mandated as arranger.

AME REIT concludes RM69m maiden post-listing acquisition exercise

AME Real Estate Investment Trust completed its post-listing acquisition of 3 industrial properties in Iskandar Malaysia, Johor valued at RM69.25m. The first 2 industrial properties, Plot 15 at i-Park @ Indahpura and Plot 43 at i-Park @ Senai Airport City, were acquired on 24 Mar 2023. The 3rd industrial property, Plot 16 at i-Park @ Indahpura, was bought from its sponsor, AME Elite Consortium Bhd, for RM26.5m. The acquisition of Plot 16 was completed ahead of the 1Q2024 timeline because of the earlier construction completion, issuance of the certificate of completion and compliance, and lease commencement. The total value of the properties is now RM668m, comprising 34 industrial properties with 1.9m sq ft agreed lettable area and 3 workers’ dormitories. The counter closed at RM1.26.
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FPSO Agogo to pilot onboard carbon capture and storage

In Feb, Yinson Production Pte Ltd and Azule Energy signed the contract for the floating production storage offloading (FPSO) vessel to be deployed at the Agogo Integrated West Hub Development Project in Angola. Construction of the world’s first post-combustion carbon capture unit installed aboard an FPSO is progressing well after the 1st steel cut in Sep. It is designed at a pilot scale and will be used as a demonstration unit in an offshore floating environment to evaluate the company’s technical readiness and to gain knowledge on operations. The carbon capture and storage (CCS) technology could be scaled up for the company’s future zero emissions FPSO projects to reduce its carbon footprint and decarbonise the offshore production industry. Other than the CCS plant, other emission-lowering technologies will be integrated into FPSO Agogo including advanced automation and digitalisation, combined-cycle power system, seawater turbine generator, hydrocarbon cargo tank blanketing scheme and integrated closed flare system. FPSO Angola is Yinson Production’s 1st offshore production project in Angola and its 8th FPSO project in West Africa. The counter closed at RM2.47.

Nomura sets up fund for private assets in Japan

Japan’s largest brokerage estimates JPY13t (USD87b) in potential demand from Japanese individuals for private assets, which underlie Nomura Securities Co’s plan to offer a private buyout fund to rich investors in Japan. The fund will be made available to specified investors, including wealthy individuals who are more sophisticated than retail investors. A 3rd party asset management company will operate the fund and invest primarily in local unlisted firms. With 3 years of profits on a downtrend, chief executive officer Kentaro Okuda has been looking for more stable income beyond traditional asset markets. One of his key initiatives has been to expand into private markets that offer clients investment opportunities in unlisted companies, real estate and infrastructure.

Hong Kong cryptocurrency exchange considers stake sale

The special administrative region issued digital-asset rules on 1 Jun that allow retail investors to trade tokens on licensed exchanges. Demand has been weak after 2022’s market rout and the unlicensed JPEX exchange scandal. BC Technology Group Ltd’s main income contributor is its crypto platform OSL’s digital assets and blockchain business. OSL’s platform spans prime brokerage, exchange and custody services for crypto markets plus providing infrastructure to financial institutions for virtual-asset trading. BC Technology has engaged industry players and funds to arrive at a HKD1b (USD128m) valuation. The company could sell parts of OSL instead of the whole business. BC Technology’s interim report shows net loss down from more than HKD300m in 1H2022 to HKD95m in 1H2023. OSL, which will be submitting a revised application for a digital-asset licence in Singapore, has migrated some clients to the Hong Kong exchange.