Select Technologies plans IPO to raise Rs2.49 billion to expand smartphone and appliance manufacturing

Select Technologies Limited, a wholly owned subsidiary of Air Link Communication Limited, plans to raise at least Rs2.49 billion through an Initial Public Offering (IPO) to support the expansion of its local manufacturing operations for smartphones, televisions and home appliances.

According to the company, the Securities and Exchange Commission of Pakistan (SECP) and Pakistan Stock Exchange (PSX) have approved the issuance and publication of a prospectus for the offering of 88.89 million ordinary shares, representing 10% of the company's post-IPO paid-up capital.

The shares will be offered through the book-building process. Of the total issue, 66.67 million shares, or 75%, will be allocated to eligible institutional and high-net-worth investors at a floor price of Rs28 per share. The maximum price band has been set at 50% above the floor price, placing the cap at Rs42 per share.

The remaining 22.22 million shares, accounting for 25% of the offering, will be made available to retail investors at the strike price determined through book building. The retail portion has been fully underwritten.

Arif Habib Limited and Intermarket Securities Limited are serving as joint consultants to the issue.

Registration of eligible investors will begin on June 17 and continue until June 23, while the book-building process is scheduled for June 22 and 23. 

Public subscription will take place on July 2 and 3.

The company said the IPO proceeds will primarily be used to establish a new manufacturing and assembly facility for air conditioners at the Sundar Green Special Economic Zone in Lahore.

Select Technologies manufactures and assembles smartphones, smart televisions, air conditioners and other consumer appliances in Pakistan for international brands including Xiaomi and Hisense.

Following the planned expansion, the company expects its annual production capacity to reach 7 million smartphones, 360,000 televisions and 400,000 air conditioners.

The new facility at Sundar Green Special Economic Zone is also expected to benefit from income tax exemptions available until FY2035, which the company said would support profitability and future growth.