Orisoft enjoys active trade to gain 2 sen on debut

BY IZWAN IDRIS

ORISOFT Technology Bhd saw active trading of its stock on debut on the KLSE's Mesdaq market yesterday, with 7.18 million shares changing hands.  

The shares opened at 47.5 sen and went on to touch a high of 49 sen but drifted lower during the day to close at 45 sen for a 2 sen premium over their initial public offer (IPO) price of 43 sen. 

For its flotation exercise, Orisoft had made a public issue of 1.5 million 10-sen shares at an offer price of 43 sen each. The issue was four times oversubscribed.Speaking after the listing ceremony in Kuala Lumpur, Orisoft managing director Raymond Su Do said he was pleased with the stock's first-day performance. 

“We expect the group to post a substantial increase in revenue and profits this year,’’ he added. 

Raymond Su Do hitting the gong to mark the company's debut on the KLSE Mesdaq market, with other board members witnessing the occasion.

Su Do said the company expected to secure more information technology contracts this year through continued development of existing software and regional expansion. 

He said each new contract could be worth between RM300,000 and RM1mil, depending on the customer's specifications.  

Currently, Orisoft has a client base of more than 500 companies – mainly in Malaysia – which use its human resources management applications. 

Orisoft is generally perceived by analysts as a small company with high growth potential. 

They said the company’s strategy of focusing on the medium - to higher-end market had paid off in terms of sales.  

OSK Research said in a recent report that it expected Orisoft’s revenue to more than double to RM7mil for the financial year ending Feb 28, 2004, from RM3.4mil in the year to Feb 28, 2003. 

The group’s pre-tax profit is also expected to grow 115% to RM2.5mil for FY2004 from RM1.2mil previously. Net earnings for the current year are projected at RM2.4mil. 

According to OSK Research, Orisoft is fairly valued at 53 sen per share based on a prospective earnings per share of 4.8 sen for the current financial year ending Feb 28, 2004, and applying the same sector price earnings ratio of 11.3 times.