The prospects for health tech in Malaysia are looking up, offering huge potential and space for growth in the healthcare sector
by NUR HANANI AZMAN / pic by HUSSEIN SHAHARUDDIN
TECHNOLOGY company Sedania Innovator Bhd is bullish of its growth prospect next year as it commits to exploring new business opportunities and strengthening its existing portfolios actively in 2021.
The increased adoption of technology in healthcare services has put the group in a favourable position to leverage the changing consumption patterns in the industry.
Its founder and MD Datuk Azrin Mohd Noor (picture) said the prospects for health technology (health tech) in Malaysia are looking up, offering huge potential and space for growth in the healthcare sector.
“As for the Malaysian health tech landscape, this year alone, we are seeing health tech startups mushrooming over a short period of eight months since the Movement Control Order.
“We do expect the proposed acquisition and our venture towards health tech to contribute strongly in 2021,” he told The Malaysian Reserve in an email interview recently.
The group, in early November, proposed to buy a 51% stake in Offspring Inc Sdn Bhd from Sedania Corp Sdn Bhd for RM15.12 million cash as part of a diversification move into consumer products specialising in healthcare, personal care, household, and baby and childcare.
The proposed acquisition comes with a profit guarantee of RM3.8 million for the financial year 2020 (FY20) and FY21, which will help improve the group’s consolidated profit.
Azrin said the move provides an opportunity for the company to venture into health tech and diversify its earnings base by providing an additional income stream.
“Two potential products that we are looking at are digital health services and digital health passports. We hope this new segment can contribute significantly to the company’s profits.
“On the community front, the strategic collaboration with Offspring on the development of digital healthcare tech solutions is meant to provide accessible health technologies to the mass,” he added.
Moving forward, Sedania Innovator will continue to enable and strengthen its financial technology (fintech) business as its beech head, concurrently, maintaining a steady pace for the other business verticals including green tech, telco tech, Internet of Things and eSports.
“These verticals would collectively play an important role in turning around the company’s performance.
“Given the bullish sentiment on the technology sector with IR4.0 coming into play, we are looking at a promising 2021, while remaining cautiously optimistic,” Azrin said.
Sedania Innovator posted a third quarter net profit of RM48,000 versus RM1.08 million it registered in the preceding year on lower contribution from its green tech segment.
Turnover for the quarter fell 31.5% year-on-year (YoY) to RM2.5 million from RM3.65 million as revenue from its green tech business took a hit on expected credit losses.
On a year-to-date basis, Sedania Innovator is in the red with a net loss of RM4.73 million, while revenue is 32% YoY lower at RM6.39 million.
On capital expenditure, Azrin said its business model for transaction-based recurring incomes in fintech and sharing platforms do not require a vast amount that would involve physical, fixed and non-consumable assets.
“If the need arises, we may seek adequate fundraising to support our cashflow requirements.
“Nevertheless, we remain cautiously optimistic that we would achieve a better year in 2021, coupled with our existing core businesses and incoming new projects next year, which will boost our bottom line positively,” he said.
For the first nine months in 2020, the fintech segment contributed the most to the group’s revenue with 43.6%, followed by telco tech (previously known as sharing platform) at 27.7%.
Sedania Innovator is also eyeing an expansion globally as part of efforts to diversify its income base.
“Our Esports Players League’s (ESPL) partnership with Paytm First Games in India is a massive step towards going global and the sort of interaction that we can foster.
“ESPL now has partnerships in over 10 countries including Panama, Colombia, Ecuador, Mexico, Peru, Singapore, Indonesia, and a few other upcoming overseas partnerships,” Azrin said.
Sedania Innovator’s recent proposed acquiree, Offspring, also has global footprints in countries such as the US, Russia, Singapore and the Philippines.
“We strive to continue growing while remaining focused on our existing portfolios,” he concluded.