99 Speedmart Files for IPO, Does that Calls for an Expansion in Their Business?
99 Speedmart IPO: Malaysia's leading mini-market retailer files draft prospectus for domestic IPO, offering up to 1.428 billion ordinary shares, signaling significant market entry.
by Alaguvelan M
Updated Mar 12, 2024
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99 Speedmart
Mini-Market one of Malaysia’s largest chain retailers, filed a draft prospectus for a domestic initial public offering (IPO) on Monday, as reported by the Securities Commission Malaysia's website.
99 Speedmart IPO
This company is planning to offer up to 1.428 billion ordinary shares. These shares include selling existing shares (up to 1.028 billion) and now issuing new shares of around 400 million. The total shares of the company are up to 17% stakes.
99 Speedmart Expansion Plans and Market Positioning
The company aims to use the money raised from the IPO for growth. They plan to open new outlets, set up new distribution centers, buy delivery trucks, and upgrade existing stores. Some of the funds will also go towards paying off existing bank loans.
It's a big player in the mini-market scene, serving around 940,000 customers every day. In 2022, its market share in mini-markets was 37.9% and in groceries retail, it was 11.1%. Right now, they have 2,542 outlets across Malaysia and 19 distribution centers.
99 Speedmart Future Plans
99 Speedmart plans at the end of 2025, they want to have a very large 3,000 outlets nationwide, and they are aiming to open about 250 new stores every year.
It operates 19 distribution centers (DCs) across Malaysia, varying in size from 10,000 to 120,000 square feet, serving its nationwide retail network within a 100-kilometer radius. The company aims to expand its DCs to at least 25 by 2027, ensuring efficient supply chain management and supporting its expanding outlet network.
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99 Speedmart Files for IPO - FAQs
1. What is the primary purpose of 99 Speedmart's IPO?
The IPO aims to raise funds for the company's expansion plans, including opening new outlets, setting up distribution centers, purchasing delivery trucks, and upgrading existing stores.
2. How many shares is 99 Speedmart planning to offer in its IPO?
The company plans to offer up to 1.428 billion ordinary shares, comprising both existing shares (up to 1.028 billion) and new shares (approximately 400 million).
3. What percentage of the company's total shares does the IPO represent?
The IPO represents up to 17% of 99 Speedmart's enlarged issued shares.
4. What are some key financial indicators provided by 99 Speedmart in its IPO prospectus?
The company serves approximately 940,000 customers per day, with an average sales transaction value per outlet per day of RM23.59. Additionally, it holds market shares of 37.9% and 11.1% in the mini-market and groceries retail segments, respectively, as of 2022.
5. How does 99 Speedmart plan to utilize the funds raised from the IPO?
The funds will primarily be used for expanding the company's outlet network, establishing new distribution centers, purchasing delivery trucks, upgrading existing outlets, and repaying existing bank borrowings.
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