Executive Chairman of the KLSE Dato' Mohd Azlan Hashim said the MESDAQ Market provides the opportunity for companies in Malacca to enhance business growth and expansion.
"The MESDAQ Market also complements the objectives of E-Melaka, the state industrialisation programme and the entreprenuerial culture that has been driving Malacca's economic growth," he said.
Mohd Azlan was speaking at the 'Going Public on the MESDAQ Market' seminar in Malacca today. The seminar was officiated by the State Secretary of Malacca YB Datuk Haji Ahmad Rusli bin Joharie on behalf of the Chief Minister of Malacca, YAB Datuk Seri Mohd Ali Rustam. The seminar was attended by over 200 representatives of high growth and technology companies based in Malacca and as well as representatives from the Malacca State Government.
"Indeed, it is most timely that this event is held in Malacca, capitalising on 2003 being declared the Malacca Information Communications Technology (ICT) Year. The state government's effort in using ICT as a catalyst to the growth of the K-Economy in the state is evident through the development of the E-Melaka programme," he said.
The objective of the E-Melaka programme is to educate and guide the people of Malacca to fully use ICT in their daily lives. The programme includes the implementation of an infrastructure action plan comprising the Malacca K-Economy Incubator and the development of the Malacca Statewide Broadband Network.
On the performance of the MESDAQ Market, Mohd Azlan said it has been very encouraging since its consolidation into the KLSE Group in March 2002. From only 5 listings in the first 3 years of operations to March 2002, there are now 24 companies listed on the MESDAQ Market. He said the number of listings is expected to increase significantly this year, with 14 companies pending listing and another 18 applications being processed.
"In terms of market capitalisation, the MESDAQ Market registered RM260 million before consolidation whilst after consolidation, its market capitalisation is now over RM2 billion as at 31 July 2003," he said.
In terms of funds mobilised (capital raised), since consolidation to 31 July 2003, a total of RM268.56 million was raised. The largest amount of capital raised on the MESDAQ Market todate is RM63.4 million for Iris Corporation, listed on 25 July 2002 and RM38.5 million for YTL E-Solution , listed on 2 July 2002.
For the investor, companies listed on the MESDAQ Market allows the investor entry into the company at an early and more exciting stage of their development whilst providing a highly viable option for investors who seek to diversify their investment portfolio with technology and high growth stocks.
For venture capitalists, the MESDAQ Market provides a strategic exit mechanism to make their investments more liquid and even realise some investment value which is important to enable venture capitalists to continue the investment cycle of re-investment of capital.
"The MESDAQ Market therefore also serves as an important component of the venture capital industry and institutional investing," Mohd Azlan added.
"Thus, the MESDAQ Market expands opportunities not only for the issuers, but also for the investor and venture capitalist," Mohd Azlan said.
Mohd Azlan said the seminar will update participants on matters of raising capital, in particular via the MESDAQ Market.
"With practitioners and regulators discussing a range of relevant topics on raising capital, this seminar is indeed an excellent opportunity to clarify issues and address concerns for businesses to raise capital for further growth and expansion," he said.
Mohd Azlan said some common misconceptions about the MESDAQ Market is that it is only for small companies, it is only for technology companies and it is a short cut to the Second and the Main Board of the KLSE.
The MESDAQ Market is not only for small companies. Although the minimum issued and paid-up capital required for listing on MESDAQ Market is RM 2 million, there is no ceiling to the issued and paid-up capital requirement. The MESDAQ Market is able to cater for large companies, in terms of size of capital - even those which qualify for a Main or Second Board listing, but prefer instead to be listed on MESDAQ Market.
The MESDAQ Market has also been established to cater to the fund raising needs of technology and high-growth companies.
Mohd Azlan said technology companies are not mere users of technology but developers of technology with the technical capabilities to research and develop new technology, processes or equipment. This includes a broad spectrum of companies that commit substantially to research and development, companies with intellectual property, companies that own new technology, companies that build brands, companies with niche markets, companies with substantial exports in non-traditional areas, companies with substantial foreign earnings, companies that contribute significantly to national development in technology.
With respect to high growth, Mohd Azlan said for the MESDAQ Market, high growth companies can either be in technology or non-technology areas . High growth companies are companies that have an outstanding business model, a unique product, a diversified market and client base for the product, perhaps in an industry that has high barriers of entry - in short a company that has a high degree of potential to grow and expand.
On another common misconception, Mohd Azlan said the MESDAQ Market is not a third board or a short cut to the Second or the Main Board of the KLSE. The Listing Requirements of the MESDAQ Market are separate and different from the Main Board and the Second Board. The MESDAQ Market caters to the niche segment of technology and high growth companies seeking the unique and strategic profiling that the MESDAQ Market can accord them.
"The KLSE today serves over 3 million investors from over 100 countries. A public listed company will therefore continue to have the attention of not only the broad investor base but also financiers, fund managers, business partners - in fact, the target audience needed for public listed companies to grow and progress further," Mohd Azlan said.
Mohd Azlan added moving forward, the outlook is very encouraging for the MESDAQ Market.
