PETALING JAYA: Serba Dinamik Holdings Bhd is planning to reduce its dependency on the oil and gas (O&G) segment and foresees that O&G will contribute 30% to the group’s revenue over the next three years, from 75% currently.
Group managing director & group CEO Datuk Mohd Abdul Karim Abdullah said 45% of its RM17 billion order book is currently in the O&G sector, with the remainder in non-O&G.
“It has been a focus and a moving forward plan of Serba Dinamik to reduce the dependency on O&G revenue. We started this journey a few years ago. There are many areas that we can focus on, such as the chlor-alkali plant in Tanzania and innovation hub in Abu Dhabi. We’re looking at convincing the market that Serba Dinamik is an integrated engineering solution company rather than an O&G player,” he said in an online media interview session yesterday.
“Towards 2023, we will see contribution from O&G reduce to 30-40% and by 2024, we are sure that the 30% is achievable,” he added.
Amid the challenging economic landscape, he said, the group will “do the necessary catch-up” to make sure that the trajectory projection of Serba Dinamik can be achieved.
“All in all, for 2020 in terms of growth of top line and bottom line, we’re looking at 10-15% growth compared with the normal 15-20% in previous years.”
Karim noted that even though the oil price collapsed recently amid the price war, its O&G contracts are still honoured as the production platforms are still running.
Its non-O&G order book includes jobs in the IT segment and engineering, procurement, construction & commissioning segment, including the US$1.78 billion (RM7.71 billion) innovation hub in Abu Dhabi.
Serba Dinamik recently completed its RM456.7 million private placement during the movement control order (MCO) period, which was the largest primary placement in Malaysia since January 2018, and third largest in Southeast Asia in 2020. Affin Hwang Capital was the appointed adviser for the proposed exercise.
Affin Hwang Capital head of equity capital markets Arvin Chia said there are expectations for more of such placements going forward, adding that it is talking to a number of potential clients.
“This transaction demonstrates that Bursa Malaysia is open for business. Liquidity is still there in a sizeable way. We find that investors are looking for good companies to invest in. They need to pump the money in growth companies.
“We have to take into account that the market will likely continue to remain volatile. Having gone through the situation itself with unprecedented volatility and negative oil prices, it shows that as long as you have a solid company that you’re bringing in to the market in terms of raise funding for them, the investment dollar is available,” said Chia.
He said it is encouraged by the success of Serba Dinamik’s private placement and attributed it to the solidity of the company.
“It was refreshing that we could execute a transaction of this size and nature with accuracy, and that everything went smoothly although we were primarily working from home. Hopefully with this transaction it opens up the doors for more fundraising opportunities for Malaysian corporates,” said Chia.
