SNS 0259 SNS NETWORK TECHNOLOGY BERHAD foresees rising IT spending from businesses, government agencies and educational institutions

 SNS 0259 SNS NETWORK TECHNOLOGY BERHAD foresees rising IT spending from businesses, government agencies and educational institutions

Since 2020 and up to 30 June 2022, SNT 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.

KUALA LUMPUR: SNS Network Technology Berhad (SNT) foresees rising spending from businesses, government agencies andeducational institutions on upgrading information technology (IT) platforms as part of their digitalisation plan to provide support for hybrid working arrangements and e-learning options.

Managing director Ko Yun Hung said the company is set to ride on the growing demand for information, communication and technology (ICT) products and services as there is no sign of a 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.

"This had boosted the demand for ICT products and services due to working from home arrangements and online classes for students.

"The Covid-19 pandemic has also served as a catalyst to the rapid adoption and execution of digitalisation initiatives in businesses to adjust to the new normal for business sustainability. Therefore, with the increased reliance on ICT, the demand for ICT products and services is expected to remain strong moving forward," he said after the company's listing ceremony on the ACE Market of Bursa Malaysia today.

Ko said SNT will further expand its device-as-a-service (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 will further expand its DaaS subscription-based IT service offerings to more customers," he further added.

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

The service provides customers with 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 up to 30 June 2022, SNT 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.

SNT has entered into contracts with 26 governmental bodies amounting to RM247.49 million and three public listed companies amounting to RM0.55 million.

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

Under the listing exercise, SNT has raised RM90.72 million from its public issue of 362.88 million new shares at an issue price of RM0.25 per share.

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

Of the total initial public offering (IPO) proceeds, RM33.40 million or 36.9 per cent will be allocated for capital expenditure of which RM30.90 million will be used to expand its DaaS subscription-based IT service and RM2.50 million to set up 10 new retail stores in the Klang Valley, Johor and Penang.

A further RM18.00 million or 19.8 per cent of the proceeds will be used to part finance the construction of the company's new regional hub in Petaling Jaya to support its nationwide expansion.

The remainder of the proceeds will be used for the repayment of bank borrowings amounting to RM20.00 million (22.0 per cent), RM13.12 million (14.5 per cent) for general working capital, RM1.50 million (1.7 per cent) to fund the marketing activities for JOI while the remaining RM4.70 million (5.1 per cent) to defray the estimated listing expenses.

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

M&A Securities Sdn Bhd is the adviser, sponsor, underwriter and placement agent for the IPO exercise.

https://www.nst.com.my/business/2022/09/827873/sns-network-foresees-rising-it-spending-businesses-government-agencies-and