by MARK RAO/ pic by MUHD AMIN NAHARUL

SMTRACK Bhd’s share price experienced high volatility yesterday, falling sharply amid an ongoing boardroom rift as the company seeks to diversify into the aviation business.

SMTrack, which provides track and trace solutions using the radio-frequency identification, or RFID, technology, closed 8.5 sen or 30.9% lower at 19 sen yesterday after hitting a high of 28 sen and a low of 13 sen in intraday trade.

The ACE Market counter saw significant selling pressure in afternoon trade plunging to a low of 13 sen from 28 sen within 90 minutes before late buying saw the counter closing at 19 sen with 54 million shares exchanging hands, giving SMTrack a market capitalisation of RM31.12 million.

The share price decline was the highest registered by the company in three years, while trading volume was almost five times the counter’s 20-day average.

On Sept 25, SMTrack received a special notice from two shareholders, said to collectively hold an over 10% stake in the company, requesting for an EGM to be held to consider resolutions that would see three current directors removed and three appointed in their place.

The shareholders requesting the EGM are Chung Kah Haur and Queck Han Tiong who hold 5.9% and 4.2% interests in the company respectively.

They have called for the EGM for the removal of SMTrack executive chairman Azmi Osman alongside directors Chow Hung Keey and Tan Choo Hwa. In their place, Chung want to seek the appointment of himself, Kamil Abd Rahman and Lai Mee Hong as directors.

In the special notice, Chung and Queck said they will proceed with the proposed EGM if the meeting is not called between the times provided by the Companies Act 2016 and/or if notice is not given to all shareholders within 14 days from the date of the requisition.

In a statement to Bursa Malaysia last month, SMTrack said its board is in the middle of verifying the shareholdings of both Chung and Queck, and will make the necessary announcements in due course.

For its financial year ended July 31 this year (FY19), SMTrack narrowed its net loss by 52.8% to RM1.82 million from the RM3.86 million net loss noted in FY18 as revenue grew 12.6% to RM1.7 million over the same period.

The reduced losses were mainly due to the lower impairment of other receivables recognised on the company’s books.

In an exchange filing, the company said it will continue to improve its operational efficiency and undertake effective cost management to maintain its competitive edge in the RFID industry, while seeking out new opportunities to diversify its revenue base.

“The group is exploring vibrant opportunities presented in the civil engineering and construction projects, as well as food chain business,” it said.

In July, SMTrack agreed to buy a 60% stake in Dexma Express Sdn Bhd (now called Citilink Aviation (M) Sdn Bhd) as part of a move to go into the air carriage service for both passengers and cargo.

The company has raised some RM3 million through a private placement to fund the proposed purchase which is expected to be completed by the fourth quarter of this year.