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Hot stock: China Star Food shoots up on debut trading
SHARES of Catalist debutant China Star Food Group shot up on active trade on the first day of trading on Wednesday.
At 11.55am, the stock has risen to 28.5 cents, up 24 per cent from its placement price of 23 cents. Some 18.16 million shares changed hands.
The Fujian-based food products company specialising in the production and sale of sweet-potato snacks had completed a S$168 million reverse takeover of cash company Brooke Asia in September last year and issued 25.25 million placement shares at 23 Singapore cents apiece to raise its public float.
"China Star Food Group Limited has reached another major milestone with its listing on the SGX Catalist. We believe the listing will raise the profile of the company as one of the leading manufacturers of healthy food snacks in the PRC," said group CEO Liang Chengwang.
SGX head of equity capital market and head of capital market development Mohamed Nasser Ismail pointed out that this listing comes with detachable warrants, giving shareholders who participated in the listing an option to increase their shareholding in the company within two years of its listing.
"Given the size of China's consumer market coupled with the company's focus on food quality and safety, China Star Food will ride on the market's growth prospects, underpinned by an increasingly affluent middle class that demand healthier snack options," Mr Ismail said. "China Star Food also plans to export its products to key Asian markets such as Japan, and we look forward to partnering the company in its growth vision."
The listing of China Star Food brings the total number of companies on Catalist to 179, with a combined market capitalisation of S$9 billion
China Star Food had raised S$5.8 million from its share placement completed this week, which will be used for general working capital and the expansion of working capacity, according to a company filing.
Its snacks are sold mainly to distributors and wholesalers, who distribute via e-commerce portals and supermarkets, petrol kiosks, convenience stores and specialty stores throughout China.