Source: THE STAR ONLINE
KUALA LUMPUR: China-based shoe sole maker Multi Sports Holdings Ltd. began trading Wednesday on Malaysia's stock exchange, becoming the second foreign company to list here.
It was a shot in the arm for the Malaysian bourse, which recently simplified and sped up procedures to attract more foreign listings and give its market more depth amid the global credit crunch.
Multi Sports hit a high of 0.89 ringgit (25 cents) shortly after debuting on the main board of Bursa Malaysia, up from its initial public offering price of 0.85 ringgit (24 cents).
However, it slid to 0.815 ringgit (23 cents) at noon in an overall sluggish market.
Chris Eng, analyst with OSK Securities, said investors are expected to be cautious with the two foreign stocks as the companies are fairly small and in the competitive area of shoe manufacturing.
Stock of China's sportswear company Xingquan International Sports Holdings Ltd, which began trading July 10, was at 1.43 ringgit (40.4 cents) at noon Wednesday, down 16 percent from its IPO price of 1.71 ringgit (48 cents).
"The appetite for good quality foreign IPO is huge but people tend to be cautious of generally small foreign companies," Eng said.
Authorities waived listing fees and gave fast-tracked approvals to Xingquan and Multi Sports under its efforts to get more foreign participation.
Multi Sports Chief Executive Lin Hou Zhi said the company chose to be listed in Malaysia because it was less affected by the global financial crisis compared to other nations.
The company has said it expected to raise 58 million ringgit ($16 million) from its share sale and would use part of the proceeds to build a second factory in China to triple its production capacity to 74.6 million pairs of soles a year.
Based in the southeastern city of Jinjiang in the Fujian province, Multi Sports posted a net profit of 46.8 million ringgit ($13 million) last year. - AP
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