By Chong Pooi KoonPublished: 2009/07/11
Xingquan International Sports Holdings Ltd (5155), a Chinese shoemaker which yesterday became the first foreign listing on the Malaysian stock exchange, ended the day with a 4 per cent premium.
The stock was the most actively traded counter in the day with 52.87 million shares changing hands. It closed at RM1.78, or 7 sen above what retail investors paid in the initial public offering (IPO).
The benchmark FTSE Bursa Malaysia KLCI rose 0.2 per cent yesterday to 1,067.76.
"We are very pleased with the IPO's performance today. We saw that Malaysian investors are very supportive of the company," executive chairman and chief executive officer Wu Qingquan told reporters after trading started in Kuala Lumpur yesterday.
Xingquan manufactures and sells shoes as well as apparels under the brand "Addnice". It also makes shoe soles for other shoe brands, such as Xtep and China Peak.
The company was raising up to RM209 million to expand its production capacity in China. The proceed will also help pay for marketing and advertising activities and to expand its distribution network.Got a great travel photo? Can it win this photo contest?
HwangDBS Vickers Research, who has a RM2.38 target price for the stock, said the main risk of investing in the company is linked to uncertainties on matters like corporate governance, accounting credibility and management integrity.
"(This is) considering that it operates in a different cultural and regulatory environment that investors may not be familiar with," HwangDBS said in a report.
"It remains to be seen how the perception will be shaped eventually, keeping in mind of the Singapore's experience that saw many Chinese companies listed there falling out of favour due to accounting irregularities and fraud incidences."