Evergreen Max Cash Capital acquires two pawnshops to expand network

PETALING JAYA: Pawnbroking service provider, retailer and trader of gold and luxury products Evergreen Max Cash Capital Bhd (EMCC) is set to enhance its market position in the pawnbroking industry with the strategic acquisition of two additional pawnshops.

The two acquisitions align with the group’s aim of expanding its “Pajaking” pawnshop network. increasing the number of outlets to 24 currently.

The two newly acquired pawnshops are situated in Sri Petaling, Kuala Lumpur, and Shah Alam, Selangor, areas with high foot traffic and dense population, ensuring optimal market reach.

EMCC was recently listed on the ACE Market of Bursa Malaysia Securities and raised RM64.2 million, the bulk of which will be utilised for the expansion of pawnshops and as cash capital for the pawnbroking business.

EMCC executive director and group managing director Datuk Low Kok Chuan said, “With the proceeds from our initial public offering, we set out to increase our network by adding five more pawnshops by the end of 2024. By acquiring established and profitable pawnshops, this strategy aligns with our growth objectives and grants us the advantage of integrating fully operational pawnshops into our network. In addition to being earnings accretive, the acquisitions would also eliminate the time-consuming process of building a new customer base, as would be the case when opening new pawnshops.”

As EMCC continues to work towards achieving its year-end target, it is exploring suitable locations to open new pawnshops as well as to acquire existing pawnshops.

“The continuous efforts to increase the number of pawnshops we operate would enable us to grow our pawnbroking business and enhance market visibility. We are optimistic about the pawnbroking industry and remain committed to maintaining our high standards of customer service to attract and retain our customers,” said Low.

Despite the challenging economic environment, he added, EMCC has succeeded in improving its financial performance.

In the cumulative nine-month period ended Sept 30, 2023 (9M23), the group’s revenue grew by 63.8% to RM74.8 million compared with the previous year’s corresponding period. In tandem with the growth in revenue, profit after tax rose by 35.7% to RM10.2 million.

With contributions from the newly acquired pawnshops, Low said, EMCC is positive on delivering a stronger financial performance this year.

The acquisitions of the entire equity stake of Pajak Gadai Pajamas Sdn Bhd and Pajak Gadai Sri Petaling Sdn Bhd for a total cash consideration of RM5.5 million were completed on Nov 14, 2023. and are expected to contribute positively to the group’s financial performance in the financial year ending Dec 31, 2024 .