MITI Bumi investors enduring sleepless nights for reaping maximum Big Caring IPO allotment?

 

CONTRARY to the norm, it seems that many privileged Bumiputera investors in the Investment, Trade and Industry Ministry (MITI) list are getting restless at being named full allocation recipients of shares in the Main Market-bound Big Caring Group Bhd’s initial public offering (IPO).

Slated for listing on Nov 19, the IPO priced at RM1.08/share is Malaysia’s second largest in 2026 with an implied market capitalisation at RM8 bil after that of Sunway Healthcare Holdings Bhd which debuted in March with a valuation of RM16.68 bil.

Instead of rejoicing, a Sarawakian full-time stock market trader revealed that some of the recipients “have already started offering shares here and there just to avoid MORA (regulatory penalties, fines and blacklisting imposed by MITI when an investor fails to pay for a Bumiputera IPO allocation)”.

“Many MITI retailers are now worried about paying for Big Caring IPO because they’ve received full allocation,” snubbed retired army major of Iban descent William Blaun (@williamblaun) on Threads.

“Of course, they applied under dozens of proxy accounts and only when they get full allocation do they realise their capital is not enough. ”

The self-proclaimed IPO valuation enthusiast further mocked the greed factor that led to this shameful predicament.

“Dearest investors. I’m sorry to say this. It really hurts and honestly, it’s quite embarrassing. Don’t embarrass the Bumiputera community. You’ve been accorded privileges but because of greed, the opportunity is being abused.”

Concern over Bumi privilege revocation

The poster went on to offer life-long investment advice to the MITI investors who are now seemingly enduring sleepless nights.

When applying, don’t be overly confident. When you get full, you scramble to find people to take up your shares.

You want a big allocation but your capital is not as big. The big thing is just the desire.

Don’t because of the behaviour of a few people, the MITI privileges for Bumiputera are tightened or withdrawn altogether.

Don’t normalise wrong things. Privilege is a responsibility, not an invitation to abuse the system.

Concurring with the poster one ex-senior equity research analyst praised him for daring to express such sentiment given “I’m not savage enough to do so”.

Other financially savvy Bumiputera investors reckoned that the ‘trapped’ MITI retailers would make a fuss if the IPO stock is traded below its IPO price on its first day of trading when the rule of thumb about stock trading is “to invest using one’s excess money ”.

Worse still, “some of these MITI applicants could only afford RM20K (example) and tended to get 10% of their share application” but nonchalantly this time around, applied for RM200K (worth of shares) “and suddenly found themselves getting full allocation ”, according to another.

‘Must be FOMO (fear of missing out) at that time – didn’t think about the risk-reward ratio when hitting the ‘buy’ button. Anyway, I’ve already paid for the entire allocation offered by MITI. Long live the Malays! ,” mocked one netizen.

Wider effect

More broadly, the primary reasons behind hesitation among the MITI retailers include:

1. Significant “offer for sale” component

A major focal point of concern is how the capital raised will be distributed. Out of the total RM2.03 bil listing, approximately RM1.4 bil (nearly 70%) is an “offer for sale” of existing shares.

This means a big chunk of the money is going directly into the pockets of early founders and the private equity firm Creador rather than being re-invested into company growth.

2. Proceeds earmarked for debt repayment

Of the remaining RM637.8 mil in fresh capital that actually goes to the group, nearly 90% (~RM570 mil) is budgeted to pay down bank borrowings.

While clearing debt improves the balance sheet and creates interest savings, conservative investors note that very little cash is left over for rapid operational expansion or new strategic initiatives

3. High valuation metrics

At the maximum retail price of RM1.08/share, Big Caring Group is targeting an implied market capitalization of RM8 bil.

This values the retail pharmacy giant at roughly 42 times its trailing earnings. Some market participants view this as a premium or aggressive valuation, drawing structural comparisons to the slower, defensive growth styles of other large retail listings on Bursa Malaysia.

Started from its first retail outlet in Damansara Uptown, Petaling Jaya in 2006, the Big Caring Group now operates 668 retail outlets (with 660 of them licensed pharmacies) across Malaysia as of Sept 30 this year. –  Focus Malaysia