SMTrack plans to venture into low-cost airline industry


KUALA LUMPUR: SMTrack Bhd , which provides radio frequency identification (RFID) solutions, is looking to venture into the low-cost airline business.

Last Saturday, it signed a memorandum of understanding with Dexma Express Sdn Bhd, the official general sales agent of Garuda Indonesia’s subsidiary Citilink, for potential investment in the upcoming Citilink Malaysia operation.

SMTrack is proposing to acquire a 60% stake in the operation for RM3.5mil.

Dexma would change its name to Citilink Aviation Malaysia Sdn Bhd and obtain air operator certificate and other licences or permits required, a representative from SMTrack, Jay Hoo Ying Wah, told reporters after the signing ceremony.

The share sales agreement, meanwhile, is expected to be concluded within three months from the date of the MoU signing.

Citilink Aviation was expected to start operation in the second quarter of 2019, providing low-cost flights especially to customers flying within the Asean region, Hoo said.

“Our first route will be from Kuala Lumpur to Phnom Penh, Cambodia. Outside the Asean countries, we will soon target China,” he said.

Meanwhile, Dexma director Alvin Heng Jee Zhi, said passengers flying with the airline would enjoy free 10kg baggage allowance and meals.

“We are not only competing in providing affordable flight tickets but also better service. We are going to be a new player in Malaysia but we are experienced in the Indonesian market,” he said.

Jakarta-based Citilink was established in 2001 as a low-cost brand of Garuda Indonesia, set up to operate shuttle services between Indonesian cities.

But since July 30, 2012, it has officially operated as a separate subsidiary of the Indonesian national carrier.

Citilink’s fleet size currently stands at just over 50 aircraft.

SMTrack, listed on Bursa Malaysia’s ACE Market, provides online track and trace solutions and platforms using RFID. Its tagging solutions ensure traceability in the logistics and supply chain as well as food processing, among others.

The group narrowed its net loss to RM3.87mil on revenue of RM1.51mil for the financial year ended July 31, 2018, compared with a loss of RM7.38mil in the preceding year.

At last Friday’s close, shares of SMTrack rose half a sen to 11.5 sen. — Bernama

Airlines , SMTrack , Citilink , airline