Sabah's Life Water makes debut on Main Market at 18.46% premium

KUALA LUMPUR: Sabah-based Life Water Bhd opened 18.46% higher than its initial public offering (IPO) price as it made its debut on the Main Market of Bursa Malaysia. The beverage manufacturer rose to 77 sen a share at the start of Wedensday trading, representing a 12 sen premium over its IPO price.

There was not shortage of trading interest for the stock, which hit an intramorning high of 87 sen a share after 111.48 million shares crossed, which put it at the top of the actives list. The company, which specialises in bottled water, carbonated drinks and packaging products with several manufacturing facilities across Sabah, plans to use the proceeds of its upcoming listing on the Main Market of Bursa Malaysia to expand into Sarawak and Brunei and enhancing distribution in Tawau with a dedicated centre.



"These expansion efforts are expected to boost Life Water’s output and revenues hence its growth trajectory," said Rakuten Trade in a note. It added that the company's key initiatives include scaling up production and launching of a new plant in Keningau, adding 59m litres of capacity by December 2024. Additionally, two new production lines are planned for Sandakan by 2025 and 2027, each adding 178 million litres.

Rakuten Trade, which has a "buy" call on Life Water, pegged a fair value of 79 sen on the share. "The company has a dividend policy at minimum 20% of net profit. Thus, we project forward dividend yields of 1.

9%, 2.0% and 2.3% for FY25F, FY26F and FY27F respectively," it said.

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