This article first appeared in The Edge Financial Daily on May 22, 2018

KUALA LUMPUR: Shares in SL Information Bhd rose as much as 27.8% in an impressive debut on Bursa Malaysia’s Leading Entrepreneur Accelerator Platform (LEAP) Market yesterday, rising five sen over its offer price of 18 sen.

The end-to-end enterprise business solution provider’s share price opened at 23 sen and finished at that level with a trading volume of 71,500 shares.

Executive director Sim Boon Ker said the group is projecting a 10% growth in revenue this year on the back of its existing business including information technology (IT) infrastructure technology solutions and enterprise resource planning (ERP).

“In the IT business, traditionally we do not see an upswing until the third and fourth quarters of the year,” he told reporters after the listing ceremony yesterday.

SL Information mainly operates in Malaysia and Singapore, comprising customers mainly from the small and medium-enterprise sector to mid-market companies and large corporations such as Astino Bhd, Tokio Marine Life Insurance Malaysia Bhd and UMW Corp Sdn Bhd.

For the financial year ended Dec 31, 2017 (FY17), the group saw its pre-tax profit rise 77.2% to RM5.53 million from RM3.12 million in FY16, while revenue grew 12.8% to RM 35.73 million from RM31.34 million in the previous year.

“Malaysia’s forecast growth of the IT infrastructure technology solution industry will be driven by growth in digital data volume, technological evolution to include big data, the Internet of things and artificial intelligence as well as continuous growth in number of new enterprises in Malaysia,” said Sim in a statement.

According to the listing memorandum, Malaysia recorded newly registered enterprises at an average increase of 4.5% annually.

SL Information cited data from the Companies Commission of Malaysia that new enterprises in Malaysia grew from 882,846 in 2009 to 1.2 million in 2016. “This provides opportunities for greater demand for IT infrastructure solutions and ERP solutions in Malaysia,” it added.

On prospects, SL Information managing director Soon Seng Teck said it is actively looking for merger and acquisition opportunities in companies with similar businesses as part of its expansion.

He said the group is currently in discussion with a potential party that is “a regional player based in Malaysia”, but did not elaborate.

SL Information’s listing entailed 10.5 million shares at 18 sen each via a private placement to raise RM1.89 million.

Of this, RM700,000 or 37.1% is earmarked for research and development expenditure, RM390,000 or 20.6% for working capital and RM800,000 or 42.3% for listing expenses.

Upon listing, SL Information's expanded share capital stands at 127 million shares. At yesterday's closing, the group has a market value of RM29.21 million.