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Cuckoo International Bhd, the Malaysian branch of South Korean home appliance leader Cuckoo Homesys Co Ltd, is set to launch its initial public offering on June 24, 2025. However, demand for its IPO has proven to be somewhat subdued, with an oversubscription rate of only 1.42 times, as it received 7,908 applications for 69.33 million shares out of an available 28.66 million shares.
Reflecting on the IPO's performance, Hoe Kian Choon, CEO and non-independent executive director of Cuckoo Malaysia, remarked, "The positive response for our IPO is both humbling and encouraging despite the market volatility and the rescheduling of our IPO to June 24, 2025. It reflects the confidence investors have in Cuckoo Malaysia’s vision, business model, and long-term growth potential."
This response echoes the cautious optimism that often accompanies financial offerings, especially in dynamic market conditions. Cuckoo International has adjusted its share price to RM1.08, a decrease from the initial RM1.29, following the completion of its bookbuilding process. The shift in pricing was anticipated and aligns with the company's broader strategy.
"We also believe that the final price of RM1.08 per share would allow investors to grow together with us on this journey and remain optimistic in achieving our target growth this year," Hoe added, citing the firm’s robust business model and the demand for its range of wellness products.
The IPO entailed approximately 365.36 million shares, divided between an institutional offering and a public offering. According to Cuckoo International, the Bumiputera allocation yielded 2,646 applications for 19.33 million shares, resulting in a lower oversubscription rate of 0.35 times. In contrast, the general public portion attracted 5,262 applications for 50 million shares, achieving a more favorable oversubscription rate of 2.49 times.
Cuckoo's IPO plan faced adjustments due to shifting market conditions; the company had postponed its listing twice since initially setting the date for April 30. This delay was attributed to increased global market volatility, a trend that continues to challenge newcomers on the stock exchange.
"We see this listing as a launchpad for even greater impact and value creation in the years ahead," Hoe stated, highlighting the company's ambition and resilience even in uncertain times.
The shares, once listed, are projected to raise about RM154.74 million. These funds are earmarked for various initiatives, including expanding its rental business, repaying bank debt, and regional growth into markets such as Singapore. Additionally, Cuckoo plans on further enhancing its IT systems and establishing new Brandshops.
RHB Investment Bank Bhd plays a significant role in this IPO as both the principal adviser and managing underwriter, while AmInvestment Bank Bhd contributes as a joint global coordinator.
Notably, Cuckoo International will issue allotment notices on June 23, ahead of the official market debut. Furthermore, due to the discount on the final retail price compared to the application price, there will be a reimbursement of 21 sen per share for successful applicants.
As Cuckoo International prepares for its public debut, the mixed demand suggests a cautious yet hopeful outlook among investors. The company’s performance in the coming months may set the tone for further expansions and the reception of its long-term vision.