15/05/2024 02:13 PM

KUALA LUMPUR, May 15 (Bernama) -- Integrated logistics service provider Sin-Kung Logistics Bhd made a flat debut today at its IPO price of 13 sen on the ACE Market of Bursa Malaysia with 26.36 million shares traded at the opening bell.

Managing director Alan Ong said the proceeds from the IPO will be used for, among others, the expansion of its Valdor warehouse in Penang which includes the air-conditioning system to store machinery for its clients in the electrical and electronics (E&E) industries.

"This would definitely benefit us as it would double the current warehouse capacity of 196,000 pallets. Some of the electronic companies have approached us asking about the operation of the warehouse," he told a press conference here today.

Sin-Kung Logistics had raised RM26 million from its IPO, from which RM10 million would be utilised to partly fund the expansion of its warehousing and distribution business.

A sum of RM2.0 million will be used to purchase 100 commercial vehicles by 2025 as part of its strategy to further expand its trucking and container haulage businesses.

The remainder of the proceeds will be used to repay bank borrowings amounting to RM9.6 million, working capital (RM1.1 million) and to defray the estimated listing expenses of RM3.3 million.

Meanwhile, Ong said in a statement that the company is poised to benefit from rising air cargo demand amid disruption in ocean shipping in the Red Sea and the booming e-commerce industry.

The company also expected the demand for its trucking services to increase in tandem with a sharp rise in demand for air cargo which is less volatile and would offer a faster and more reliable service, compared to traditional shipping routes.

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, as they currently serve about 50 airlines in Peninsular Malaysia and Singapore.

The company is well-positioned to secure more jobs as its airport-to-airport road feeder services cover extensive airports in the region.

Sin-Kung Logistics owns and operates 461 commercial vehicles for the provision of its trucking, container haulage, warehousing and distribution as well as other logistics-related businesses.

"By owning and operating a wide and diverse range of commercial vehicles to support our services, we have greater control over our operations in terms of service availability, delivery and scheduling, which allows us to ensure that our customers' goods are delivered on-time according to the required schedule and level of service quality," he said.


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