Twenty bumi listings planned

So far four companies listed under Government scheme

KUALA LUMPUR: About 20 companies are expected to be listed on the local bourse under the Government's Skim Jejak Jaya Bumiputra (SJJB).

“Prestariang Bhd is the fourth bumiputra company to be listed this year under this programme. So far six companies have been listed, including two last year. Its small number, of course, but going forward there are probably around 20 listings in the pipeline,” International Trade and Industry Minister Datuk Seri Mustapa Mohamed said after launching Prestariang's prospectus yesterday. However, he did not provide a timeline for this.

The SJJB scheme was set up in 2007 to elevate bumiputra entrepreneurial capabilities, particularly in the area of equity ownership.

To date, it has identified 30 capable bumiputra companies that have fulfilled the Securities Commission's (SC) listing criteria and need only Government assistance to ensure they meet Bursa Malaysia's listing requirements.

“We know that the number of bumiputra companies listed on the local stock exchange is quite small. Bumiputra equity in the corporate sector is still not satisfactory. So that's why the Government introduced this scheme,” Mustapa said.

Main Market-bound Prestariang expects to raise RM19.8mil from its initial public offering (IPO). The company is also bullish on its financial performance for the rest of the year driven by its expansion plans.

“Last financial year was sterling. We are expecting another sterling performance this year. I think once you see our first quarter results, you will know roughly what we will be making,”said chief executive officer Dr Abu Hassan Ismail.

For the financial year ended Dec 31, 2010 (FY10), Prestariang posted a net profit of RM15.1mil, a100% increase from RM7.5mil in FY09. Its revenue in FY10 rose to RM58.5mil from RM39.4mil a year ago.

The information and communications technology (ICT) training and certification provider has laid out its plans to expand geographically, venture into new business, introduce new certification programmes as well as set up new and upgrade its training programmes and certifications.

The company intends to lease and renovate properties in Penang, Johor and Sarawak for the purpose of establishing a sales office and training centre in each of the states. It is also in the midst of expanding its business to the Middle East.

“With our solid background and global plans strategically in place, we will soon have new income streams form our overseas markets as well as our in-house titles launched for the global markets,” Dr Abu said.

He said the reason why Prestariang was going for a listing exercise was because it was at the stage of “too small to be big and too big to be small”.

“We thought that by tapping the capital market, it will give us access to funds for us to grow not just locally but also to grow globally. It is a very crowded market currently, and that's one of the reasons we are pushing it (listing) towards the end of the month,” Dr Abu said.

To a question, he said Prestariang currently had an orderbook of RM145.9mil and was working hard to increase the figure.

In FY10, Prestariang derived the bulk of its revenue from government contracts. About 63% of its revenue in FY10 is from the Higher Education Ministry, 11.7% from the Inland Revenue Board and 0.03% from the Health Ministry.

Dr Abu said the company realised its dependency on government contracts and have been making changes to reduce its dependency.

“We were dependent on government contracts. If you see the first quarter results, you will see a big shift of the instruments and initiatives we've put in place for the last six to nine months.

“You will see a big shift in our relationship with the private sector. We're not a government-dependent company,” he said.

Prestariang's IPO entails the public issue of 22 million new ordinary shares and an offer for sale of 77 million shares at an issue price of 90 sen per share.

The public issue of 22 million new ordinary shares will be allocated to the Malaysian public while the offer for sale shares will be allocated to eligible directors, employees, business associates, bumiputras, selected investors and the general public.

Prestariang is expected to be listed on the Main Market of Bursa Malaysia on July 27.