This article first appeared in Capital, The Edge Malaysia Weekly on June 15, 2026 - June 21, 2026

AS the global technology sector regains momentum, engineering services firm Sum Technology Bhd (KL:SUM) is positioning itself to capitalise on rising demand driven by artificial intelligence, semiconductors, data centres and electric vehicles.

“We can see the semiconductor industry coming back after a prolonged downturn following the Covid-19 oversupply cycle and disruptions from the US-China trade war,” CEO Lee Thiam Hing, who will own an 8.97% stake in the company after its initial public offering (IPO), tells The Edge in an interview.

Investor interest in the company has been robust. The public portion of its IPO was oversubscribed by 110.54 times.

Based in Petaling Jaya, Selangor, Sum Technology specialises in the construction of cleanrooms and other controlled-environment facilities, as well as the provision of mechanical, electrical, process utilities and fire protection systems for mission-critical operations. It also manufactures customised mechanical ventilation and air-conditioning products.

Its IPO is expected to raise RM32.76 million based on the issue price of 28 sen per share, with more than half of the proceeds channelled for working capital while the remainder is allocated for the expansion of its headquarters and establishment of an office in Manila, the Philippines — its largest overseas market — as well as design and development activities.

The new Manila office is in line with the increasing demand for its products and services, particularly in the mechanical, ventilation and air conditioning (MVAC) sector for mission-critical facilities such as data centres.

Upon listing, Sum Technology will have a market capitalisation of RM126 million, implying a valuation of 20.74 times its trailing earnings.

Sum Technology’s IPO does not include any offer-for-sale allocation. Tradeview Research says it is a positive move as it signals management’s confidence in the company’s long-term growth prospects.

In the financial year ended Dec 31, 2025 (FY2025), the company posted a net profit of RM6.06 million, 12.4% higher than the RM5.39 million recorded in FY2024. Annual revenue came in at RM65.67 million, up 27.9% from RM51.35 million a year ago.

Tradeview sees the Philippines as Sum Technology’s second growth driver, supported by semiconductor localisation and accelerating data centre investments. “We expect the Philippines to contribute 21%–24% of group revenue over FY2026–FY2028, supported by growing MVAC demand, additional turnkey project wins and deeper customer penetration, driving FY2025–FY2028 Philippine revenue CAGR (compound annual growth rate) of about 44% and overall margin expansion.”

In FY2025, the Philippines accounted for 20.46% of the company’s revenue, after Malaysia’s 74.01%. The balance 5.53% came from Taiwan, Singapore, Australia, Bangladesh, India and Indonesia.

Despite the company’s smaller market capitalisation and slightly thinner margin profile, the research house does not apply a discounted valuation multiple and value the company at a FY2027 price-earnings ratio of 13 times, broadly in line with the simple average forward PER of its domestic mechanical, electrical and plumbing peers.

Similarly, PublicInvest Research ascribed a 13 times PER to FY2027 earnings per share, hence deriving a fair value of 35 sen, which represents a 35% discount to its peer’s average PER of about 20 times.

“We believe the discount is justified given Sum Technology’s relatively smaller market capitalisation as well as business scale,” the research house notes.

That said, PublicInvest Research forecast the company’s earnings to grow at a three-year CAGR of about 37%, underpinned by accelerating demand for turnkey cleanroom and mechanical, electrical, plumbing and fire solutions, supported by a strong RM385 million tender pipeline, higher-margin MVAC manufacturing, expanding Philippines trading exposure, and capacity expansion initiatives.

It adds that long-term growth will be underpinned by the expansion of Malaysia’s cleanroom engineering, procurement, construction and management industry, supported by sustained investments in high-tech and regulated industries.

As at April 22, 2026, Sum Technology had an order book of about RM39.1 million, of which RM35.9 million is expected to be recognised in FY2026, followed by RM2 million and RM1.2 million in FY2027 and FY2028 respectively.

Its RM385 million tender book comprises 12 projects, with semiconductor-related projects accounting for slightly more than half, followed by data centres and aviation projects, according to Lee. Its historical win rate stands at 18%.

He also shares that the single largest tender project is an aviation project worth close to RM70 million.

Within the aviation industry, the company is exploring opportunities in the maintenance, repair and overhaul segment by providing air-conditioning, ventilation and fire protection systems for aircraft maintenance hangars.

Lee, however, shares that the key challenges post-listing are the scaling of the organisation to support further growth, as well as the execution of digital transformation, which would take time when it comes to the transition from traditional paper-based workflows.

PublicInvest Research highlights the three key risks for the company: (i) highly competitive industry comprising local and multinational players, where projects are awarded through competitive bidding; (ii) high customer concentration, with a substantial portion of revenue derived from a limited number of project-based customers; and (iii) its reliance on subcontractors to perform installation and structural works.

Malacca Securities is the principal adviser, sponsor and placement agent of Sum Technology’s IPO exercise.

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