KUALA LUMPUR (Nov 7): Edaran Bhd’s share price hit an 18-month high of 71 sen in Tuesday morning trade, after its unit Edaran IT Services Sdn Bhd won a contract to maintain the Royal Malaysian Customs Department’s operating system and MySST (Malaysia Sales & Services Tax) application worth RM89.88 million — which is almost three times the company’s market capitalisation based on its Monday (Nov 6)’s closing price.
At 9.50am, the stock pared some gains to settle at 68.5 sen, which is still 17 sen or 33.01% higher than 51.5 sen at the end of trading on Monday.
Based on its share price of 68.5 sen, its market capitalisation was RM40.70 million.
The counter was the second top gainer on Bursa Malaysia, as well as the seventh most active stock with 17.57 million shares traded — almost 300 times its 200-day trading average volume of 59,385.5 shares.
In a filing on Monday, Edaran said the contract, which was awarded by the Ministry of Finance, started on Sept 1 and will span a period of four years.
“Proceeds from the contract shall contribute towards the earnings of the group for the financial year ending June 30, 2024 (FY2024) until FY2027,” Edaran said.
For the fourth quarter ended June 30, 2023 (4QFY2023), the company’s net profit quadrupled to RM1.06 million from RM201,000 a year ago, on the back of a doubling in revenue to RM20.71 million from RM10.90 million in 4QFY2022. Earnings per share rose to 1.83 sen from 0.35 sen.
For FY2023, the group’s net profit also jumped four-fold to RM2.03 million from RM520,000 a year ago, while revenue grew by 44.86% to RM69.43 million from RM47.93 million.