Sin-Kung Logistics shares open at 13c/share on ACE Market

KUALA LUMPUR: The trading stock of Sin-Kung Logistics Bhd changed hands for the first time on the ACE Market of Bursa Malaysia at 13 sen a share, on a par with the price of its initial public offering (IPO).

At 10.55am, shares in the company were up 0.5 sen to 13.5 sen a share on the back of 114.05 million shares traded, making it the fourth most active counter on the Exchange.

In a statement, Sin-Kung, which is principally involved in the provision of trucking services with a focus on airport-to-airport road feeder services, said it expects demand for its trucking services to increase in tandem with a sharp rise in demand for air cargo.

It said the preference for air cargo was due to it being a less volatile alternative to traditional shipping routes, offering faster and more reliable service.

Managing director Alan Ong said the rapid rise of e-commerce post Covid-19, disruption in ocean shipping and supply chain diversification are some of the main drivers of air cargo demand in the current market.

“The Red Sea crisis and e-commerce boom have somehow benefitted Sin-Kung Logistics as we are currently serving about 50 airlines across Peninsular Malaysia, and Singapore.

“The company is well-positioned to secure more jobs as our airport-to-airport road feeder services covering extensive network of airports across Peninsular Malaysia, Singapore and Thailand,” he said.

Of the RM26mil in proceeds raised from the IPO, Sin-Kung will utilise RM2mil to purchase 100 commercial vehicles by 2025, as part of its strategy to further expand its trucking and container haulage businesses.

A further RM10mil will go towards funding its warehousing and distribution services’ expansion to meet the future rising demand from manufacturing and e-commerce sectors.

A sum of RM9.6 million will be used to repay bank borrowings followed by RM1.1mil for working capital and the remainder RM3.3mil for its estimated listing expenses.

Upon its listing, Sin-Kung had a market capitalisation of RM156mil based on its enlarged share capital of 1.2 billion shares.