Strategic Public Relations Group Limited - BGMC Investor Relations
Name of Organization / Company: Strategic Public Relations Group Limited, Hong Kong, China
Category: C01 - C12 Award for Innovation in Communications / PR > C02. Award for Innovation in Investor Relations
Entry Title: BGMC International Limited - Constructing an Effective IPO
Essay:
Background and Challenges
BGMC International Limited (“BGMC”) is the first Malaysia-based construction services company to list on The Stock Exchange of Hong Kong Limited (“SEHK”). Although BGMC has a proven 20-year track record of delivering quality construction services in Malaysia, the Hong Kong investment community knew little about the Company, its business model or its growth drivers. Compounding matters, recent listings of construction companies, particularly those on the GEM, were negatively perceived as “shell” companies. It was therefore essential for BGMC to differentiate itself and convey clearly its strengths, future growth strategies and investment value.
IPO Period
A two-pronged strategy of education and publicity was employed during flotation and listing day to create interest in BGMC among investors.
Highlighted the prominent background of BGMC’s management and BGMC’s close connection with government linked companies in Malaysia:
-Four out of seven board members have either Tan Sri or Dato titles – clear evidence of its professionalism and prominent social status. A few editorials were arranged to convey such messages, as well as the close relationship between management and the royal family of Malaysia
- BGMC has established close ties with government linked companies in Malaysia. Also noteworthy is that BGMC has proven track record in securing Build, Lease, Maintain and Transfer (“BLMT”) project which would ensure BGMC enjoy long-term maintenance-related income. Yet, such business model is not common in Hong Kong. To educate the investment community on BGMC’s accomplishments, SPRG assisted in producing a corporate video and PPT to highlight BGMC’s capability in securing BLMT projects. Some KOL luncheons were also arranged for in-depth explanation of the business model
Positioned BGMC as the first Malaysian construction service company to list on SEHK and to capture business opportunities arising from the “One Belt One Road” i-nitiative
- SPRG sought to position BGMC as a Malaysian pioneer and highlighted this message in certain advertorials during the flotation and post-listing period. Riding on the combined efforts of SPRG’s offices in both Hong Kong and Malaysia, certain press releases were dispatched in the region to stir up the investment atmosphere during the flotation period
- SPRG also prepared possible questions with suggested answers about the reason for listing in Hong Kong – i.e. raise BGMC’s profile in Greater China in order to capture opportunities resulting from the “One Belt One Road” initiatives, and taking into account their BLMT experience
-The BGMC management had never faced the financial media in Hong Kong, hence were ill prepared to respond to their questions without possibly violating regulatory requirements. SPRG provided media skills training so that the management would be well prepared for the roadshow and impact day media conference SPRG suggested the management to invite Malaysia’s royal family and world-renowned Malaysian badminton star to attend the listing ceremony
- SPRG suggested and assisted in arranging Her Royal Highness (HRH) Tuanku Sultanah Hajah Haminah, Queen of the State of Kedah, Malaysia as well as the world-renowned badminton star Datuk Wira Lee Chong Wei to attend the listing ceremony to raise attention to BGMC’s successful SE-HK listing
- Graced by the attendance of HRH and Lee Chong Wei, the listing drew significant attention from the investment community and made BGMC become “talk of the town” shortly after listing
Accomplishment
Overwhelmingly positive market response despite dull stock market
- Despite Hong Kong stock market was experiencing consolidation in July and August 2017 with Hang Seng Index struggled between 26,000 pts and 27,000 pts, BGMC’s public tranche recorded oversubscription of approximately 31 times, with shares actively traded on its first day of listing and closed at HK$0.81 per share, up approximately 15.7% as compared with the offer price of HK$0.70 per share