Malaysia’s Raya Airways mulling IPO – report

Raya Airways (TH, Kuala Lumpur Subang) is considering an Initial Public Offering (IPO) “soon” to capitalise on a profitable period aided by the Covid-19 pandemic, sources close to the matter told business-centric news site The Vibes on September 27.

The Malaysian cargo specialist has been “talking about this for a while”, having been planning for such a move since at least mid-2020, the sources said.

It has recently been gearing up for expansion on the back of heightened demand for air freight brought about during the pandemic, including hiring technical staff from entities like the industry regulator Malaysian Aviation Commission (MAVCOM).

But the sources could not provide a timeline for the IPO or which stock exchange Raya Airways would launch it through, Bursa Malaysia or elsewhere.

The cargo airline has posted a net profit for the last two financial years, of MYR77 million ringgit (USD18.4 million) for the year ending December 31, 2020, on revenue of MYR334.12 million (USD79.9 million), and MYR3.02 million (USD722,000) profit and MYR197.68 million (USD47.3 million) revenue for 2019. It currently operates a fleet of one B737-400(SF), one B767-200(BDSF), and two B767-200(SF)s, the ch-aviation fleets advanced module shows.

Raya Airways was not immediately available for comment.

The day after the report, on September 28, Raya Airways announced that it was about to become “the first Malaysian freight service provider in ASEAN to operate cargo drones”, having just signed a Proof of Concept (POC) – a test validating a product is feasible for commercialisation – with Pen Aviation, an unmanned aircraft systems innovator based in Petaling Jaya near Kuala Lumpur.

It said the POC, expected to commence in the fourth quarter of 2021, is “aimed at unlocking prospects for Raya Airways’ freight services” with the utilisation of the PEN55V, Pen Aviation’s mid-sized cargo drone. Raya’s final objective is to operate a mixed fleet of PEN55Vs and the heavier PEN1360V cargo drones.

“With cargo UAVs already proven effective in other logistics operations such as the delivery of vital medicines to otherwise inaccessible locations, and to warehouses to deliver parts at precise moments, this POC will specifically explore the deployment of drones to facilitate port logistics,” the statement explained.

The drones will be operated by certified pilots to pick up and drop off packages weighing up to 12kg, with a distance of up to 50km, mostly from containers on cargo ships to the port and vice versa. The additional capability will “serve Asia and the Asia Pacific region with a cargo drone fleet capable of flying up to 1,000kg of goods. […] Beyond port operations we aim to introduce drones in the field of surveillance and maritime in the future,” it added.