by S BIRRUNTHA / Pic source: SNS Network’s Facebook

SNS Network Technology Bhd debuts on the ACE Market of Bursa Malaysia today at 25 sen, unchanged from its issue price.

Under the listing exercise, the ICT system and solutions provider has raised RM90.72 million from its public issue of 362.88 million new shares at an issue price of 25 sen per share.

The listing also includes an offer for sale of 48.38 million existing shares to selected investors by way of private placement.

According to SNS Network Technology, of the total IPO proceeds, RM33.4 million (36.9%) will be allocated for capital expenditure, of which RM30.9 million will be used to expand its data-as-a-service (DaaS) subscription-based IT service and RM2.5 million to set up 10 new retail stores in the Klang Valley, Johor and Penang.

A further RM18 million (19.8%) of the proceeds will be used to partly finance the construction of the group’s new regional hub in Petaling Jaya, Selangor, to support its nationwide expansion.

The remainder of the proceeds will be used for the repayment of bank borrowings amounting to RM20 million (22%), RM13.1 million (14.5%) for general working capital, RM1.5 million (1.7%) for marketing of its JOI Smart Classroom framework and RM4.7 million (5.1%) to defray listing expenses.

Based on the enlarged share capital of 1.61 billion shares, the total market capitalisation of SNS Network Technology upon its listing would be RM403.19 million.

SNS Network Technology MD Ko Yun Hung (fifth from left) said the group is well-positioned to benefit from the digital transformation of corporate Malaysia, government agencies and educational institutions in the new post-pandemic normal.

He added that the group foresees rising spending of businesses, government agencies and educational institutions on upgrading IT platforms as part of their digitalisation plan to provide support for hybrid working arrangements and e-learning options.

“The group is set to ride on the growing demand for ICT products and services as there is no sign of slowdown in spending from the public and private sectors to upgrade their IT system.

“The outbreak of the Covid-19 pandemic in 2020 and 2021 had led to the imposition of movement restrictions by the government to curb the spread of the virus,” he told the reporters after the group’s listing ceremony in Kuala Lumpur today.

Ko added that this has boosted the demand for ICT products and services due to working from home arrangements and online classes for students.

Meanwhile, he noted that the Covid-19 pandemic had also served as a catalyst to the rapid adoption and execution of digitisation initiatives in businesses to adjust to the new normal for business sustainability.

He said therefore, with the increased reliance on ICT, the demand for ICT products and services is expected to remain strong moving forward.

Commenting further, Ko also said SNS Network Technology will further expand its DaaS subscription-based IT service after listing.

“Since the opening of all economic sectors, we have seen a surge in demand for DaaS subscription-based IT service from the public and private sectors.

“In view of the potential growth from this segment, SNS Network Technology will further expand its DaaS subscription-based IT service offerings to more customers,” he said.

DaaS is a model for device leasing offered to customers based on monthly subscription payments.

The service provides customers the flexibility to adjust their usage according to their latest business and operational needs to avoid large capital expenditure for bulk purchase of ICT products.

Since 2020 and until June 30, 2022, SNS Network Technology has entered into 82 DaaS subscriptions with a total subscription value of RM255.86 million and received 75 enquiries from governmental bodies and public listed companies.

From the above-mentioned enquiries, SNS Network Technology has entered into contracts with 26 governmental bodies amounting to RM247.49 million and three public listed companies amounting to RM550,000.

Based on enquiries from potential customers, SNS Network Technology will purchase ICT products such as desktops, laptops, interactive smartboards, workstation, digital signages, printers and servers to support the expansion of the service.