KUALA LUMPUR: Zantat Holdings Bhd secured a price of 40 sen, which is 60 per cent higher than its 25 sen initial public offering (IPO) price, or a premium of 15 sen at its ACE Market debut on Wednesday (Mac 27).
The counter witnessed the exchange of 6.3 million shares at the opening bell.
Zantat raised RM14 million in its IPO exercise to partially fund its venture into the bioplastics value chain and to expand its core business of calcium carbonate production.
The producer of calcium carbonate said that it is well-positioned to benefit from the growing market for compostable and biodegradable alternatives.
It produced its first bioplastic chemical before going public, setting the stage for its downstream growth.
According to Zantat's managing director, Ivan Chan, the first bioplastic compound was made available for purchase this quarter for use in environmentally friendly products and services.
"We are committed to establishing our footprint in the bioplastic compound supply chain to further value add on our expertise developed through the years in this industry.
"Our core business activities continue to benefit from the domestic and export markets, both of which contribute significantly to our earnings and allow us to remain resilient through market cycles," he said in a statement.
According to Rakuten Trade Research, Zantat is expected to register core net earnings of RM7.6 million and RM8.8 million for the financial years 2024 (FY24) and FY25, respectively.
The firm said this is underpinned by increased ground calcium carbonate (GCC) sales in the Indian market, the launch of a new GCC line, and the rising sales of ultra-fine GCC and biodegradable compounds.
"In addition, Zantat has a healthy balance sheet, with a gearing ratio of 0.2 times as of December FY23, a status expected to persist post-IPO," it said.
Rakuten said the company is poised to benefit from the thriving Indian plastics industry, with forecasts indicating substantial growth by 2027–28.
It added that the company's plans to expand GCC production capacity align with this growth trajectory, supported by key customers like Alok Group and Sonali Group.
"This positions Zantat to effectively leverage India's economic expansion," it said.