KUALA LUMPUR: Biomass fuel product manufacturer Elridge Energy Holdings Bhd (EEHB) makes a strong debut on the ACE Market of Bursa Malaysia, providing a premium of 11 sen over its offer price of 29 sen a share.
At its closing price of 40 sen, EEHB had a market capitalisation of RM800mil. The stock, which was the most actively traded yesterday, hit a high of 40.5 sen and low of 32.5 sen in intraday trade.
EEHB remains bullish on its performance backed by growing global demand for biomass fuel products as well as an order book of up to 720,000 tonne that is expected to be fulfilled within the next one to two years.
Executive director and finance director Salihudin Mohd Razali said the group expects an uptick in demand for its biomass fuel products particularly from Japan.
“For the Japanese market, we are practically only covering about less than 1% of the (biomass fuel) market.
“I believe there is still a large portion for us to capture just in Japan itself,” he said at the listing ceremony at Bursa Malaysia here yesterday.
Other export markets like Indonesia, Singapore and Thailand also have seen an increase in demand for green products, according to Salihudin.
“We see cases where certain countries have incentives to get their coal-fired power plants converted to biomass – which is driven by their own green ambitions and goals,” he pointed out.
In financial year ended 2023, Indonesia contributed RM119.54mil or 35.66% to EEHB’s revenue, while Singapore contributed RM105.18mil or 31.37%.
Its exports to Japan had generated revenue of RM86.98mil or 25.95% of the total while Malaysia and Thailand accounted for less than 5% of turnover.
On EEHB’s order book, Salihudin said: “We have an order book for this year of up to 720,000 tonnes of our palm kernel shell products. Based on our record, we have already secured orders for our products for this year and the next.”
Prior to its market debut, EEHB saw an oversubscription of 28.78 times and successfully raised RM101.5mil in proceeds.
A large portion of the money would go to expanding production capacity, which includes the construction of new factories and warehouses, purchase of new machinery and equipment as well as working capital.
For the second quarter of financial year ended June 30, 2024 (2Q24) , EEHB posted a revenue of RM103.3mil and a net profit of RM11.71mil or earnings per share (EPS) of 0.59 sen.
To date, EHHB has a cumulative revenue of RM190.59mil and a net profit of RM22.66mil or EPS of 1.13 sen.
