According to Bursa Malaysia’s off-market transactions, a block of 10.3 million Scicom shares had been traded in a deal on Tuesday at an average price of 54 sen valuing the deal at RM5.562mil. Brahmal, who runs private equity firm Creador Sdn Bhd, is believed to be the buyer of this block.
He, however, declined to comment when contacted.
The seller of Scicom shares is believed to be Lembaga Tabung Haji (LTH), which had ceased to be a substantial shareholder in Scicom on Sept 6 after selling down its shares since early June when it held a 7.14% stake.
Dealers said that other investors were looking to follow Brahmal’s lead, seeing as he made significant returns via his investment in MyEG Services Bhd. Brahmal had emerged as a substantial shareholder in MyEG in October last year at a price of around 80 sen per share. Then, in September, he pared down his stake in the e-government service provider to 2.2% from 5.11% at an undisclosed price base on Bursa filings. At that time, the stock had traded in a range of RM1.80 to RM2.00.
An analyst said that Scicom was poised to enjoy an earnings growth, pointing to Scicom’s fourth-quarter net profit of RM5.3mil, which was a significant 35% rise year-on-year. The latest quarterly earnings of 1.78 sen a share values the stock at 10.5 times based on yesterday’s closing price of 70 sen.
For the financial year ended June 30, 2013, it recorded a net profit of RM14.56mil and declared a dividend of 3 sen per share, translating into a payout ratio of about 60% of total profits. The company had RM15.61mil in cash and a zero debt position as at end-June 2013.
On Scicom’s growth, Leo said that company would be moving into solutions and that their patronage in business process outsourcing would move more intricately along the value chain.
“Clients do not just see things from a single perspective. It is important for us to provide the aspect of vertical integration, so in order to do that, we have to get involved in the supply chain as well,” Leo said. Scicom derives 93% from its outsourcing operations, and 7% from its other businesses.
Among them are its wholly-owned Scicom Academy, which graduated 3,940 students through its various certification programmes for both governmental and corporate clients, and its 70%-owned Scicom International College Sdn Bhd, which was recently awarded a full college licence and is currently obtaining accreditations from the Malaysian Qualification Agency for its planned diploma programmes.