KUALA LUMPUR (Jan 13): NationGate Holdings Bhd’s share price breached the RM1 mark and jumped 11% in early morning trade on Friday (Jan 13), merely a day after a firm start on the ACE Market of Bursa Malaysia.
At the time of writing, the stock was up five sen to RM1.05 a share, with 89.96 million shares done. The stock earlier rose to a high of RM1.11.
The electronics manufacturing service provider debuted on the ACE Market on Thursday, closing at RM1 against its initial public offering (IPO) price of 38 sen — a premium of 163.16%.
Its trading volume was 654.92 million, while its market capitalisation stood at RM2.07 billion, making it the largest IPO on the ACE Market to date.
UOB Kay Hian Securities on Wednesday (Jan 11) initiated coverage of NationGate with a "buy" rating at 38 sen, and a target price of 98 sen, and said the stock was listing at an undemanding 13.8 times 2021 price-earnings.
The research house said it sees multiple legs of growth that can supercharge a three-year revenue/core net profit compound annual growth rate of 24%/30%, premised on cross value-chain integration, trade-diversion related supply chain reconfiguration, and aggressive expansionary plans.
“While NationGate can offer high-mix low-volume and low-mix high volume production set-ups, its strategic diversification towards recession-proof segments has borne fruition, especially amid the current economic downturn," the research house added.