Industry Overview

11. INDEPENDENT MARKET RESEARCH REPORT 11. INDEPENDENT MARKET RESEARCH REPORT (Prepared for inclusion in the Prospectus) Q VITAL FACTOR CONSULTING Vital Factor Consulting Sdn Bhd Creating Winning Business Solutions (Company No.: 266797-n 75C & 77C Jalan 5522/19 Damansara Jaya 47400 Petaling Jaya 5elangor Darul Ehsan, Malaysia Tel: (603) 7728-0248 Fax: (603) 7728-7248 Email: enquires@vitalfactor.com15 JUN 2011 Website: www.vitalfactor.com The Board of Directors Prestariang Berhad Level 7, Menara Milenium Jalan Damanlela Pusat Bandar Damansara Damansara Heights
50490 Kuala Lumpur Dear Sirs and Madam Independent Assessment of the ICT Services Industry Focusing on Professional ICT Training and Certification, and Distribution of Proprietary Software Licences in Malaysia
The following is an independent assessment of the Information and Communications Technology (ICT) Services Industry focusing on professional ICT training and certification, and distribution of proprietary software licences in Malaysia prepared by Vital Factor Consulting Sdn Bhd for inclusion in the prospectus of Prestariang Berhad (herein together with all or anyone or more of its subsidiaries will be referred to as “Prestariang Group” or the “Group”) in relation to its listing on the Main Market of Bursa Malaysia Securities Berhad. 1. BACKGROUND • Prestariang Group is primarily an ICT service provider focusing on professional ICT training and certification, and software licence distribution and management.
• As such, the focus of this report will be on professional ICT training and certification, and distribution of software licences.

Prestariang Berhad Page 1 0’44 Industry Assessment 302 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions 2. ECONOMIC PERFORMANCE OF MALAYSIA Economic Performance 2.1 • The performance of the Malaysian economy has a direct impact on businesses operating in Malaysia. A growing economy will provide the basis for business gro’A1:h.
• As for 2009, Malaysia’s real GOP for the first quarter contracted by 6.2% compared to the same period in the previous year. However, the implementation of fiscal stimulus measures by the Malaysian Government led to the subsequent recovery in the last quarter of 2009. Overall, Malaysia’s real GOP for 2009 contracted moderately by 1.7%.
• The Malaysian economy registered a real GOP growth of 7.2% in 2010. The growth was driven by expansion in domestic demand, which was supported by higher private and public sector spending.

8%  7.2%  •  Malaysia’s  real  GOP  had  been  growing  every  year  from  2005  to  2008.  The  Malaysian  economy  registered a growth of 4.7% in 2008,  amidst  the  international  financial  turmoil and sharp deterioration in the  global  economic  environment.  Robust  domestic  demand,  in  particular  private  consumption  and  -2%  -1.7%  strong public spending, supported the growth during the year.
(Source: Bank Negara Malaysia) 2.2 Performance of the Services Sector • The services sector is one of the key economic indicators of the Malaysian economy. In addition, the ICT Services Industry also falls within the services sector of the economy. Hence, the performance of the services sector has a direct impact on the local economy and operators within the ICT Services Industry in general. Figure 1. Real GOP Growth • While external demand was strong in the first half of 2008, the sharp and rapid deterioration in the global economic conditions as well as major correction in commodity prices in the second half led to a contraction in Malaysia’s export performance in the latter part of the second half of the year. Prestariang Berhad Page 2 0’44 Industry Assessment 303 •  During  the  fourth  quarter  of  200  13.9%  30%  2009, the Business Condition Index (BCI) registered a growth  150  ·3.5%  -5.10/0  0%  of 4.5% to  reach  118.8 points.  The  manufacturing  sector  improved with increased export  and local sales.
11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR COI\lSULTII\lG Creating Winning Business Solutions
12% • In 2008, real GDP of the services sector recorded a growth of 7.4%, 9% which was lower than the growth of 7.2% 7.4% 6.8% 10.2% recorded in 2007. The lower 6% growth rate was due to a slowdown in the performances of the services 3% sub-sectors that were dependent on trade and capital-market related activities. 2005 2006 2010 Figure 2. Real GOP Growth of the Services Sector • As for 2009, real GDP of the services sector for the first quarter registered a contraction of 0.2%. The d~cline was mainly attributed to contractions registered in the services sub-sectors, notably, the manufacturing and trade sectors. However, improved performances of the services sub-sectors that were dependent on domestic economic activities led to the subsequent recovery of the services sector in the second half of the year. Overall, real GDP of the services sector for 2009 recorded a growth of 2.6%.
• In 2010, the services sector registered a real GDP growth of 6.8%and was the largest contributor to growth for the year, contributing 3.9 percentage points to the overall GDP growth. The growth was attributed to improving domestic and external demand.

(Source: Bank Negara Malaysia)
2.3 Business Confidence • The level of confidence of the Malaysian economy within the business community provides an indication of the robustness and likely trend of business activities in Malaysia. A strong business confidence level is expected to boost economic activities that will benefit businesses in Malaysia.
• In the first quarter of 2010, the BCI grew further by 4.4% to reach 124.0 points. The growth was attributed to the continued increase in domestic order, expected production and expected export sales.

4Qtr09 1Qtrl0 2Qtrl0 3Qtr10 4Qlrl0 1Qtr11 Figure 3. Business Condition Index Prestariang Berhad Page 3 of44 Industry Assessment 304 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d)
Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • The BCI contracted by 3.5% to 119.6 points in the second quarter of 2010. The contraction was due to quarter-on-quarter losses recorded by sales, production, new domestic orders, new export orders and capacity utilisation sub-indices. Nevertheless, the BCI remained above its 1OO-point threshold.
• In the third quarter of 2010, the BCI registered a contraction of 12.3% to 104.9 points. Production, new local and export orders, and expected production and export sales declined significantly, although capacity utilisation of businesses grew marginally.
• The BCI declined further by 5.1 % to 99.5 points in the fourth quarter of 2010. Businesses recorded lower sales, and expected export sales was also lower while capacity utilisation of businesses remained stable. However, production and expected production increased marginally.
• After declining for three consecutive quarters, the BCI recovered and surpassed its 100-point threshold in the first quarter of 2011 by reaching 113.3 points, representing a growth of 13.9%. Growth was driven by higher sales and new export orders as well as positive expectations for production and export sales.

(Source: Malaysian Institute of Economic Research)
2.4 Consumer Confidence • The provision of professional ICT certification courses and proprietary software licensing services caters to various user groups inclUding the general consumer. As such, the level of consumer confidence of the economy will impact on their spending pattern. A high consumer confidence level indicates increased consumer spending that will benefit businesses in Malaysia.
20% 4.0% 4.2% 4.9% • In the fourth quarter of 2009, the 200 Consumer Sentiment Index -3.3% (CSI) increased by 4.0% to 150 109.6 114.2 110.4 115.8 117.2 -20%109.6 points compared to the third quarter of 2009. 100 -40% Consumers continued to remain 50 -60%optimistic, albeit cautiously. Favourable current and expected finances, and employment . expectations contributed to the growth in the CSI.
4Qlr09 1Qtr10 2Qtr10 3Qlr10 4QIr10 1Qtr11 Figure 4. Consumer Sentiment Index • The CSI registered a growth of 4.2% to reach 114.2 points in the first quarter of 2010. The growth was attributable to the continued improvement in current and expected finances, and employment expectations. Prestariang Berhad Page 40f44 Industry Assessment 305 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR COI\lSULTII\lG Creating Winning Business Solutions • In the second quarter of 2010, the CSI contracted by 3.3% to 110.4 points. The contraction was due to waning current and expected incomes, the moderating employment outlook, mounting concerns over inflation and cautious spending plans.
• During the third quarter of 2010, the CSI grew by 4.9% to reach 115.8 points, representing the highest points recorded in the last 2-and-a-half years. Positive outcomes in present incomes, and job and income outlook as well as subsiding fears of inflation contributed to the growth.
• The CSI grew further by 1.2% to reach 117.2 points in the fourth quarter of 2010. Improving incomes and encouraging financial and job expectations contributed to the growth although inflationary concerns returned.
• In the first quarter of 2011, the CSI registered a contraction of 7.7% to 108.2 points. Fears of inflation prevailed leading consumers to be cautious of their spending plans while employment expectations, and current and expected finances remained stable.

(Source: Malaysian Institute of Economic Research) 3 OVERALL INDUSTRY STRUCTURE 3.1 Structure of the leT Industry • The ICT Services Industry is part of the overalilCT Industry.
o  Prestariang Group operates in this sub-sector.  Figure 5.  Structure of the ICT Industry  •  The hardware sub-sector is concerned with physical computing related devices and is segmented into three major subsections: Processor hardware such as mainframes, midrange systems, desktop computers, notebooks, servers and others Input/output devices such as keyboards, scanners, desktop monitors, printers, speakers and others
Prestariang Berhad Page 50f44 Industry Assessment 306 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions Storage devices such disks  as  solid-state drives, optical disks and hard  •  The software sub-sector involves coded programs that There are four major types of software: Operating systems Application software Systems and development tools Platforms  run  on  hardware.  •  The telecommunications sub-sector involves the transmission of signals to enable communications, and includes: Designing and manufacturing communications equipment such as hubs, routers, switches, bridges and modems Maintaining and operating data networks, including copper wire, fibre optic and wireless networks  •  The ICT services sub-sector includes: Software development Systems/network integration Facilities management/outsourcing Consulting and professional services Education and training User support services Sales and distribution  •  The Internet-based services sub-sector covers, among others: Cloud computing services, including Software-as-a-Service, Infrastructure-as-a-Service, and Platform-as-a-Service Content, including content in the form of video, audio, still images and text  Platforms, including social networking platforms, email platforms and image posting platforms Security, such as anti-virus and anti-spam software e-commerce websites  •  Prestariang Group’s involvement in the ICT services sub-sector of the overall ICT Industry is centred upon education and training, and sales and distribution services.
Prestariang Berhad Page 60f44 Industry Assessment 307 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) o VITAL FACTOR CONSULTING
Creating Winning Business Solutions 3.2 Structure of the ICT Services Industry • The ICT Services Industry is depicted as follows:
o Prestariang Group operates in these sub-sectors. Figure 6. Structure of the leT Services Industry • Software development is primarily concerned with the writing of computer programs to create systems. Some of these systems could be for Accounting and Finance or Inventory System. It includes software system analysis, design, development and testing, as well as modification and migration of software systems.
• Systems/Network Integration covers all services required to providelCT
solutions for the organisation, inclUding, among others: Installation of software solution (example, installation of enterprise resourceplanning software) Systems integration incorporating design, procurement and installation of hardware and systems and applications software Network integration incorporating network design, procurement, cabling, configuration and testing
• Facilities Management/Outsourcing is focused on the management of customers’ ICT infrastructure or functions either in whole or in part. This sub­sector includes management of the following, among others:

Data centre management Disaster recovery HoUwarm/cold sites Network management Back-up and archiving services ICT support services including
backroom operations business processes call centres help desks Prestariang Berhad Page 70’44 Industry Assessment 308 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Consulting and Professional services include, among others: IT Strategic Planning Business Needs Analysis Business Impact Analysis Capacity Planning Business Process Reengineering Systems Analysis and Design Hardware requirements and planning Networking requirements and planning
• Education and Training services include the provIsion of basic and academic training courses, professional certification courses, and the development and supply of course materials.
• User Support Services include all activities required to support the users of the ICT facilities including hardware, software and data communications. This include, among others:

User Help Desk Call Centres Hardware maintenance Network maintenance Applications support Systems support • Sales and distribution include· all activities associated with the sales, marketing and distribution of hardware, software and ICT services
• Prestariang Group’s business is involved in the education and training, and sales and distribution sub-sectors of the ICT services industry.

 

3.3 Structure of the ICT Training and Education Sector • The ICT training and education sector is segmented into three categories: ICT Training and Education Sector Academic and ProfessionalBasic ICT Vocational ICT Training Literacy Training and Certification ICT Education o Prestariang Group operates in these sub-sectors. Figure 7. Structure of the ICT Training and Education Sector Prestariang Berhad Page Bof44 Industry Assessment 309 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Basic ICT literacy training involves the teaching of fundamental ICT knowledge and skills to provide the learner with adequate theoretical knowledge and practical skills in computer software applications and hardware, as well as communications.
• Academic and Vocational ICT education is designed to lead to the award of an academic qualification, such as certificates, diplomas, and undergraduate and postgraduate degrees.
• Professional ICT training and certification refers to programmes that are designed to impart and to certify skills and knowledge in specific ICT products and technologies covering hardware, software and communications. At the end of the training session, the individual sits for an examination to gain certification. Some common professional ICT training and certifications are from technology and software vendors that train and certify individuals to be competent in their products. Examples of professional ICT certification include Cisco systems certification, IBM corporation certification and Microsoft certification.
Although third-party service providers may conduct the training programmes and provide the facilitate for sitting of examinations, the vendor or the owner of the technology or product is the principal party that sets the examination papers, certifies the participant and issues the certification. ProfessionallCT certifications are globally recognised as they are provided by the vendor or product owners.
• Prestariang Group is engaged in the provision of basic ICT literacy training and professional ICT training and certification.

3.4 Structure of the Software Licensing Sector • A software licence is a legal contract between the user and owner of the software to enable the user to use the software subject to terms and conditions set out by the owner.
• In all situations with the exception of freeware and open source software, the user is provided with object codes or executable programs to run the software. The executable programs only enable the user to run the software, but not make modifications to the software.

Prestariang Berhad Page 90f44 Industry Assessment 310 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions

 

3.4.1 Categories of Commonly Licensed Software • The types of software that are commonly being licensed include the following:
c:J Prestariang Group is involved in the licensing of these categories of software Figure 8. Categories of Commonly Licensed Software • Software licences commonly cover the following categories of software: Application software; Systems software; Communications software; Systems and development tools and utilities.
• Application software is software that is designed to perform one or more tasks for users. Application software can be programmed to manipulate information in the form of text, numbers, graphics, sound, still and moving images or some combination of these elements, depending on the task for· which it is designed. Some examples of application software include manufacturing software solutions, accounting software, word processors, spreadsheet programs, engineering software, security software and graphics software.
• Systems software refers to software that is designed to operate computer hardware, and to provide and maintain a platform for running application software. The main types of system software are:

Computer Basic InpuUOutput System (BIOS) and device firmware/drivers; The operating system, which allows the various components of a computer to work together, serves as the interface between the user and the hardware, and provides a platform to run other software. The main operating systems that are currently in use are Microsoft Windows, Mac OS X, and Linux; Utility software, which is used to analyse, configure, optimise and maintain the computer. Prestariang Berhad Page 10 of 44 Industry Assessment 311 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Communications software is a type of application software that serves to facilitate networking or communications among users and devices. It differs from the traditional application software in that the software’s main function is to transfer data from one point to another. Some examples of communications software include local area network and wide area network, and messaging software including emails and groupware.
• System and development tools and utilities provide tools to assist a programmer in writing computer programs, as well as utilities to help systems engineers to configure, fine-tune, optimise and provide analysis and reports on the operation of computers and associated peripherals and devices like storage, networking and output devices. Examples of systems and development tools and utilities include databases, query languages, programming languages and compilers, text editors, graphical user interface generators, performance analysis tools, debugging tools, static analysis and formal verification tools, data modelling tools, memory usage and optimisation tools, and web development software.

 

3.4.2 Types of Software • Generally, there are three types of software as follows:
Custom-Buill Enterprise Proprietary OthersSoftware Application Software Software o Prestanang Group is involved in licensing of this type of sot!ware Figure 9. Types of Software • Custom-built software requires building the software from scratch. The process of building a software system from scratch requires understanding of the user requirements and translating them into a workable software system. Among others, custom-built software goes through a detailed process of user requirements study, systems design and specification, functional specification, coding, program/module testing, program/module integration, system testing, live testing, and installation. Prestariang Berhad Page 11 0’44 Industry Assessment 312 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTII\lG Creating Winning Business Solutions A custom-built software system commonly requires significant level of technical expertise and resources to build. As such, custom-built software systems are commonly very expensive. Custom-built software is designed and built for a specific owner. As such, the intellectual property of the completed custom-built software resides with the owner. The owner may engage an external third party to build its system software or it could be built in-house. As such, in this scenario, there is no licensing involved. • Enterprise Application Software is basically completed and functional software where the same software may be licensed for use to multiple users. Many of this type of software are focused on the business or organisation level. They commonly perform business or organisation functions such as enterprise resource planning, accounting and finance, customer relationship management, and human resource management. Enterprise application software are typically hosted on a central processor or server and enables simultaneous multiple users commonly over a local or wide area network. Due to the differences in user and technical requirements or bu~inesses and organisations, enterprise application software normally require professionals to firstly understand the user needs and technical reqUirements followed by configuring the software, including modifying, adding or deleting modules, to meet user needs and technical requirements. Examples of software package solutions include SAP, Sage, Microsoft Dynamics Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) solutions, and IBM ERP solutions. • Proprietary Software, sometimes also refer to as retail software or shrink­wrapped software, especially when they are sold through retail outlets. They are mainly sold to end-consumers based on restricted licensed to use agreement. Commonly such software does not require professionals to configure and install them. Many of this type of software are used by consumers as well as business users on their personal computers and other devices on a standalone basis. Some of this type of software includes Microsoft Windows, Microsoft Word, Microsoft Excel, Adobe Flash Player, Adobe Phofoshop, Mac OS X, WinZip and Symantec’s Norton AntiVirus software. Proprietary software also covers non-business applications, for example AutoCad is proprietary software used for engineering drawings. Although most proprietary software can be installed by the users and used on a standalone basis, there are situations, partiCUlarly in a commercial environment or within large organisations, professionals are required to install and configure the software in a network environment to set various parameters in terms of granting access, priorities and allocating user status, etc. Prestariang Berhad Page 12 of44 Industry Assessment 313 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) ~,VITAL FACTOR CONSULTING Creating Winning Business Solutions Q Proprietary software covers various types of software, including applications, systems, communications, and systems and development tools and utilities. Prestariang Group is primarily engaged in distribution and management of proprietary software licences to businesses and organisations. • Other types of software include public domain software, freeware, shareware, open source software and Software-as-a Service. Although all this type of software is proprietary in that all the software are covered by copyright for their source codes, they have very difference methods of charging and in some cases they are provided for free. This category also cover embedded software where the software are either hard coded into computer chips or hardware, or loaded into devices and commonly inaccessible to users.
3.4.3 Types of Licensing of Proprietary Software • There are four common methods of licensing of proprietary software as follows:
OEM Pack Box Pack/Shrink­On-line Licences Wrapped Licences Licences Volume Licensing
o  Preslariang Group is involved in Ihis type of software licensing  Figure 10.  Types of Proprietary Software Licensing  •  Original Equipment Manufacturer (OEM) licences are targeted at manufacturers or distributors of hardware to enable them to pre-install the software into their hardware for resale as a software/hardware package.  •  Box Pack or Shrink-wrapped software contains a licence agreement that is pre-packed in the software box, and is usually purchased off-the-shelf in retail stores;  •  Online software licences is similar to retail sales licences, except that all licensing agreements and payments are done online;
Prestariang Berhad Page 13 of44 Industry Assessment 314 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Volume licensing agreements are targeted at organisations that require large number of copies of particular software to be installed on multiple computers within the organisation. In such an arrangement, the software supplier can provide the organisation with one copy of the software for multiple installations within the organisation. In turn, the buyer gets a discount for the bulk purchase.
• Prestariang Group is engaged in the provision of software licensing services on a volume basis covering applications, operating systems, communications, and system and development tools and utilities.

4. THREAT OF SUBSTITUTE 4.1 Professional ICT Training and Certification • Prestariang Group provides professional ICT training and certification using a classroom-based format where classes are led by instructors enabling interactions with participants. At the end of the training session, participants sit for examinations provided by the product or technology owners.
• There are three forms of substitute to the classroom-based training offered by

Prestariang Group as follows: Academic and vocational education; Online training; Self-learning.
Academic and Vocational Education • Universities and colleges that provide certificate, diploma and degree courses in ICT may substitute for the need to undertake professional training and certification. However, most of the ICT related courses offered by universities and colleges are mainly academic in nature and commonly do not provide practical knowledge and skills on specific software or technology products offered by vendors.
• Some universities and colleges also incorporate professionallCT training and certifications, commonly as an addition to their normal course wOrk. Prestariang Group offers its professional ICT training and certification courses to public higher education institutions as an addition to the students’ normal course work.

Online Training • One of the substitutes to classroom-based professional ICT training is online training. Individuals are able to undertake online training for their selected professional ICT training courses. Prestariang Berhad Page 14 of 44 Industry Assessment 315 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Online training courses are sometimes provided by technology and software vendors themselves or through independent third parties. With online training, providers can be located anywhere in the world servicing anyone anywhere.
• Online training comes in many forms including video based training with an instructor teaching the course materials as well as providing course materials and exercises only.
• However, online training have several disadvantages: The lack of physical face-to-face interactions may make it difficult for participants to understand some parts of the course materials; There is no instant feedback if the participants have a query or require further elaborations.
• The major advantages of online training are flexibility in time for going through the training materials, the duration for completing the course, and the location for studying the course.
• Participants of online training will also have to undertake examinations to complete their certification process. Participants will need to select from a list of authorised test centres for their final certification examinations.

Self-Learning • Self-learning refers to acquIring leT skills and knowledge without going through a formal training course with assistance from a third party. A person may self-learn by using external reference materials such as books, CD/DVD and information obtained through the Internet.
• However, the lack of structured course materials, assistance from instructors and evaluation from third parties encountered in self-learning may not suit some people.
• Participants of self-learning will also have to undertake examinations to complete their certification process. Participants will need to select from a list of authorised test centres for their final certification examinations.

 

4.2 Proprietary Software Licensing Services • Prestariang Group distributes and manages proprietary software licences on a volume licensing basis.
• There are a number of alternative methods to the volume licensing method of

proprietary software license distribution. They include: OEM Pack licensing; Box Pack/Shrink-Wrapped licences purchased from retail stores; Online licences bought and paid for over the internet. Prestariang Berhad Page 15 of 44 Industry Assessment 316 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Despite the number of alternative methods of proprietary software licence distribution, the most cost effective method for buyers of large volume of particular software is through volume licensing. 5. GOVERNMENT LEGISLATION, POLICIES AND INCENTIVES 5.1 Registration with Human Resources Development Berhad • Under the Pembangunan Sumber Manusia Berhad Act 2001, it is mandatory for training providers with ten or more employees to register with the Human Resources Development Berhad (HRDB), which falls under the purview of the Ministry of Human Resources.
• According to Section 14 (1) of the Act, every employer to whom the Act applies is required to pay a human resources development levy in respect of each of his employees at the rate of 1% of the employees’ monthly wages.

(Source: Pembangunan Sumber Manusia Berhad Act 2001) • The scope of registration is classified into four categories and are differentiated by their respective qualifying conditions: A permanent A permanent A permanent Operate from Office office office . office home Minimum one No training No training No training training room, room, computer room, computer room, computer Training Room computer lab or lab or workshop lab or workshop lab or workshop workshop with is required is required is required trainin facilities At least two full-At least one full-No full-time At least one full-Trainer time local time local local trainer is time local trainer trainers trainer re uired Conducted in-Conducted in-Conducted in-Conducted in­house or public house or public house or public house or public Company training courses training courses training courses training courses Experience for at least one for at least one for at least one for at least one year year year year SBl, SBl-Khas and PROLUS SBl and SBl­Allowable All ofPSMB’s SBl training(only soft skills Khas training Training training schemes scheme training schemesScheme schemes)
*Category B (Home Office) (Source: Human Resources Development Berhad) • Prestariang Group is registered with HRDB as a Category A training provider. Prestariang Berhad Page 16 of 44 Industry Assessment 317 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTII\lG Creating Winning Business Solutions

5.2 Registration with Ministry of Finance • Operators that wish to provide ICT training and certification courses or software licence distribution services to public educational institutions are required to register with the Ministry of Finance (MOF) through the ePerolehan system.
• Operators that are registered with MOF are able to submit quotations or tender bids, and obtain tender documents for Government projects.
• Registration is valid for a period of one year and renewable on an annual basis.

(Source: Ministry of Finance)
5.3 Multimedia Super Corridor Status • In general, the Malaysian Government provides incentives for active MSC . status companies under the Promotion of Investment Act 1986.
• An MSC status company that is granted with pioneer status in its field, such as software development, would be given a 100% exemption from taxable statutory income for a period of five years. This exemption can be renewed for one additional five-year period.
• In addition, a company that is conferred with MSC status is also eligible for a 100% Investment Tax Allowance (ITA) on qualifying capital expenditure within a five year period.
• A company that carries out in-house research and development (R&D) activities with the purpose of developing or improving its products and services for its business operations is eligible for a 50% ITA of qualifying capital expenditure within a ten year period.
• Other incentives include: Duty-free importation of multimedia equipment; Provision of R&D facilities and infrastructure if companies are located within MSC Cyber centres such as Cyberjaya, Technology Park, Kuala Lumpur City Centre, UPM-MTDC, Penang Cybercity-1, Kulim High Tech Park, KL Sentral, Melaka International Trade Centre and MSC Cyberport Johor.

(Sources: MIDA and Secondary Market Research undertaken by Vital Factor Consulting Sdn Bhd) • In 2005, Prestariang Systems Sdn Bhd, a fully owned subsidiary within the Prestariang Group, was granted MSC status. Prestariang Berhad Page 17 of 44 Industry Assessment 318 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions 5.4 6. 6.1 6.2 • Prestariang Systems Sdn Bhd had been granted Pioneer Status, which was subsequently renewed for commencement on 30 June 2010 for another five years. Environmental Regulations • Prestariang Group does not generate any waste that has an adverse effect on the environment as it is engaged in a service-based industry. DEMAND Total Spending on ICT • Demand for ICT had shown 80,000continuous growth, which augurs well for operators in the industry. (Note: Total 60,000 ICT here includes computer g <:: hardware, computer E40,OOO :::;;:software, computer services 0:: and communications) 20,000 • Between 2006 and 2010, the o demand for ICT products and services based on total ICT spending grew at an average annual rate of 11.2%. In 2010, total ICT spending grew by 9.7% to reach RM49.9 billion.
20% 12.3%10% 49,865
0% -10% -20% 2006 2007 2008 2009 2010 Figure 11. Total Spending on ICT (Source: Secondary Market Research undertaken by Vital Factor Consulting Sdn Bhd) • The continuous growth in demand for ICT services in the past few years indicates the robustness of the overalllCT industry. Spending on Computer Services 12,000 26.9% 26.5% ——_ 23.1%• Between 2006 and 2010, —–!~}%
spending on computer 9,000
7,872 services increased at an <:: 6,601g average annual rate of 23.9%. E 6,000 5,364 L :::;;: 0:: 4,242 • In 2010, the spending on 3,000 computer services grew by 19.2% to reach RM7.9 billion. I 30% 15% 0% -15% o t——”’–‘-‘–I—-‘-‘—-”–+-‘—-L–f–‘—-‘—I–‘—–‘-4 -30% 2006 2007 2006 2009 2010 Figure 12. Spending on Computer Services Prestariang Berhad Page 18 of44 Industry Assessment 319 20,000  0%  15,397  13,200  10,686  -30%  8,836  I !  -60%  Io +—”——‘-”—t—L-:….c.L-;-…L………L..-t—–”–‘–‘–+-.-L—‘—-i  -90%  2004  2005  2006  2007 2008  Figure 14.  Value of Gross Output of
11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • In 2010, spending on computer services represented approximately 15.8% of totallCT spending. (Source: Secondary Market Research undertaken by Vital Factor Consulting Sdn Bhd) 6.3 Spending on Computer Software • The demand for software 8,000
30% 22.0%licences is partly indicated by the spending on computer 6,000
15% software. • Between 2006 and 2010, total spending on computer software increased at an average annual rate of 19.8%.
• In 2010, spending on computer software grew by 17.2% to reach RM4.8 billion.
• In 2010. spending on computer software represented approximately 9.6% of totallCT spending.

(Source: Secondary Market Research undertaken by Vital Factor Consulting
Sdn Bhd) 7. SUPPLY 7.1 Overall Output of Computer Services • The supply of overall computer services had shown continuous growth between 2004 and 2008 (latest available data) ·based on value of gross output. (Note: Computer services here include hardware consultancy, software consultancy and supply, data processing, database activities, maintenance and repair, and other computer related services, but exclude telecommunications services). 30% Computer Services Prestariang Berhad Page 19 of44 Industry Assessment 320

11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Between 2004 and 2008 (latest available data), the supply of the overall computer services based on the value of gross output by organisations that provided computer services increased at an average annual rate of 21.9%.
• In 2008, gross output value of computer services grew by 16.6% to reach RM15.4 billion. (Source: Department of Statistics)

7.2 Output of Software Consultancy and Supply Services • The supply of software licences is partly indicated by the supply of software consultancy and supply services.
• Between 2004 and 2008 12.000

31.6% 140% (latest available data), the r–__~~7% ! oRM Million 8,370 0%value of gross output from the 9;000 I .-Growth Rate , 7,299supply of software 6,509 . Icoconsultancy and supply ~ 6,000’E
5,447 ~ r-40% services increased at an :::0 ex:average annual rate of 19.3%. 3.000 ·80% • In 2008, gross output value of 0 software consultancy and 2004 2005 2006 2007 2008 supply services grew by Software Consultancy and Supply Services14.7% to reach RM8.4 billion. • In 2008, value of gross output from software consultancy and supply services represented approximately 54.4% of value of gross output from the overall total computer services. (Source Department of Statistics) 8. DEMAND DEPENDENCIES 8.1 Professional ICT Training and Certification Number of people engaged in the IOPersonICT Industry 80,000 , 26.6% ! -Growth Rale 30% ~ 21.1% 19.5% Professional ICT training and i “”-..1.4.6% ——­• 60,000 1 -…..–56,463 certification is primarily 47,253 targeted at people seeking 40,000 ,I 39,005 0% Iemployment or already employed in the ICT Industry. 20,000 i This  is  because  ICT  personnel continually  are required to learn new  2004  2005  2006  2007  2008  products  and  technologies,  Figure 16.  Number of People Engaged in
Computer Services Establishments in Malaysia increase their knowledge and skills set, and keep up-to-date with technology and product innovations.
Prestariang Berhad Page 20 of 44 Industry Assessment 321
11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d)

 

 

o VITAL FACTOR COI\lSULTII\lG Creating Winning Business Solutions • As such, demand dependencies for the provision of professional ICT training and certification will include, among others, number of people engaged in the ICT Industry in Malaysia.
• Between 2004 and 2008 (latest available data), the number of employees engaged in computer services establishments in Malaysia increased at an average annual rate of 20.4%. In 2008, the number of such employees grew by 19.5% reaching 56,463 persons. (Source Department of Statistics)
• The continuing growth in the number of people engaged in the ICT industry in Malaysia will form a strong potential customer base for providers of professional leT training and certifications.

Number of Students in Public Tertiary Education Institutions Prestariang Group also• 900,000 20% provides professional ICT training and certifications to
0% ICT and ICT related students 600,000 521,696 541.170 in public tertiary education 424,343 -20% institutions in Malaysia. 300,000 -40%• As such, demand dependencies for the provision of professional ICT 2006 2007 training and certification for Prestariang Group in in Public Universities, Colleges and particular will include the Polytechnics number and growth of students in public universities, community colleges and polytechnics in Malaysia. • Between 2006 and 2010, the number of students enrolled in public universities, community colleges and polytechnics increased at an average annual rate of 7.6%. In 2010, the number of students grew by 5.1% reaching 568,731 students. (Source: Ministry ofHigher Education)
• The continuing i~crease in the number of students enrolled in pUblic tertiary education institutions will continue to provide demand for services from organisations like Prestariang Group that provides professional ICT training and certifications to public tertiary education institutions.

2008 2009 2010 Prestariang Berhad Page 21 of44 Industry Assessment 322 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions Number of ICT and Engineering Graduates from Public Tertiary Education Institutions • Prestariang Group provides professional ICT training and certifications to public higher education institution graduating students in the field of ICT, multimedia and electrical engineering. As such the number of graduating students in these fields would provide demand for Prestariang Group’s services.
• In 2010, there were a total of 8,141 graduates in the field of ICT and 39,166 graduates in the field of engineering from public universities, polytechnics and community colleges in Malaysia. (Source: Ministry of Higher Education)

Increasing Importance of Multimedia • Multimedia covers audio, still images, animation and video and interactivity contents, which are usually captured, processed, stored and displayed by computerised and/or electronic information content devices.
• There is great interest in pursuing education including professional training and certification in multimedia in the light of convergence of technologies, content and devices spurred by, among others, the following:

increasing adoption of broadband internet access as one of the delivery mechanism for multimedia content and applications; development of innovative internet based content and applications; popularity of multimedia content and applications; increasing sophistication and innovation in content and application development, especially in the areas of three-dimensional cinematography, animation, online games and interactive games and applications; social networking platforms incorporating multimedia content and applications.
Government Recognition and Allocation • The Government recognises the importance of ICT incorporating multimedia in developing a skilled and knowledge based society. This importance as reflected in Government spending and budget allocation for human capital development activities as provided for in the 2011 Budget, 10lh Malaysia Plan and expenditure on pUblic education will continue to provide growth opportunities for service providers of ICT training and certification. This is in line with the Government’s initiatives to enhance human capital development, which will promote the demand for ICT training and certification. This will also help to address deficiencies in competency levels of graduates to improve their employability. Prestariang Berhad Page 22 of 44 Industry Assessment 323 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d)

o VITAL FACTOR COI\lSULTING Creating Winning Business Solutions 9. SUPPLY DEPENDENCIES • Organisations like Prestariang Group who win contracts from the Government would also depend on Government allocations and expenditure on the areas in which they are servicing. 9.1 Professional ICT Training and Certification Government Development Expenditure on Education • Government expenditure on IClRMMillion 50%18.000 -Growth 37.2%education would have a direct -;” 25.8~ 17~ ……..t!:.3%impact on organisations like 12.046 0%Prestariang Group that Co 12,000 10.827 ~provides professional ICT E -50% training and certifications to :;a:: 6,271 6,000students in public tertiary ·100% education institutions. • Between 2006 and 2010, the total federal government Figure 18. Total Federal Government development expenditure on Development Expenditure on Education education increased at an average annual rate of 22.5%. In 2010, the total federal government development expenditure on education grew by 11.3% to reach RM12.0 billion. (Source: Bank Negara Malaysia) 9.2 Proprietary Software Licensing Services • The distribution of proprietary software licensing is partly dependent on the number of computer hardware. This is because computer hardware, particularly central processing units and servers require operating systems, for example Microsoft Windows, and computer users require application software, for example Microsoft Word, to do their work.
• Between 2006 and 2010, the total spending on computer hardware increased at an average annual rate of 10.7%. In 2010, the total spending on computer hardware grew by 10.4% to reach RM9.9 billion.(Source: Secondary Market Research underfaken by Vital Factor Consulting Sdn Bhd).
• Between 2000 and 2007 (latest available data), the number of households with access to personal computers grew by an average annual rate of 12.8%, where in 2007, 31.3% of households had access to personal computers (Source: Department of Statistics)
• The continuing growth in spending on computer hardware and increasing household penetration of personal computers will provide growth opportunities to distributors of software licences.

2006 2007 2008 2009 2010 Prestariang Berhad Page 23 of 44 Industry Assessment 324 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) o VITAL FACTOR CONSULTII\lG Creating Winning Business Solutions 10. COMPETITION
10.1 Nature of Competition in the Industry • In general, operators in the ICT Services Industry focusing on the training and certification, and distribution of software licences in Malaysia face normalcompetitive conditions, which is similar to a free enterprise environment characterised by the following: There are no undue government regulations or licensing requirements; The industry is not dominated by a single or small number of operators; Operators may enter and leave the industry freely; No single or small group of operators is large enough to dictate pricing.
• In such an environment, the industry is subjected to normal supply and demand conditions moderated by the price mechanism. Operators compete on product and service differentiations, and other factors of competition.
• However, pricing for software licensing is mainly dictated by the owner of the product or technology. As such, resellers like Prestariang Group that distribute third party software licences have to abide by the pricing guidelines from their principals or product owners, like Microsoft.

 

10.2 Factors of Competition • As with most free enterprise environment, the factors that are used to compete and to differentiate one operator from another include the follOWing: Contracts from Government; Certified instructors; Track record; Network of training centres; Economies of scale.
10.3 Impact of Factors of Competition on Prestariang Group • Contracts from Government The ability to win contracts from the Government is a very significant competitive factor. This is because winners of Government contracts are commonly provided with high value contracts, and in most cases being the only one or one of very few organisations able to serve one or several defined user groups. As such, winning Government contracts reduces the competitive pressure from other operators in the industry. Currently, Prestariang Group’s key business advantage is that a significant part of its business is derived from winning Government contracts. These contracts prOVide Prestariang Group with a strong platform of assured revenue stream at least till the medium term, to further expand its business. Prestariang Berhad Page 24 0’44 Industry Assessment 325 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR COI\lSULTING Creating Winning Business Solutions As at 30 April 2011, Prestariang Group had secured a contract from the Ministry of Higher Education for professional ICT training and certification, and another contract from Microsoft (Malaysia) Sdn Bhd, which is coordinated by the Ministry of Finance, for the provision of ICT training. In addition, the Group had obtained contracts from the Ministry of Higher Education, Ministry of Education, Ministry of Rural and Regional Development of Malaysia and Inland Revenue Board for the supply of software licences. Furthermore, Prestariang Group also received a letter of award from the Authority for Info-communications Technology Industry of Brunei Darussalam for professionallCT training and certification. • Certified Instructors Certified instructors are important as the quality of the professional ICT training courses is largely dependent on the delivery of the course content and materials by instructors. As such, dedicated, knowledgeable, qualified and high quality instructors are major differentiators, particularly in retaining and attracting participants. As at 30 April 2011, Prestariang Group had two master trainers to train certified instructors. The instructors undergo an induction course to familiarise themselves with the Group’s professional certification courseware and software. On-going training is also provided to keep the instructors up­to-date with the latest developments in technologies and products. • Track Record A reputable track record is essential in winning new contracts. As such, operators who are able to demonstrate capabilities in conducting good training and quality technical support services would gain significant advantage over their competitors. As at 30 April 2011, Prestariang Group had successfully trained approximately 18,790 participants from public tertiary education institutions for its professional ICT training and certification services since 2006. • Network of Training Centres For providers of classroom-based professional ICT training and certification, availability of training centres is important, as participants need to attend courses regularly. As such, operators that have a wide network of training centres would be able to provide convenience to participants to attract them as well as to win major contracts to service a large group of people throughout Malaysia. Prestariang Berhad Page 25 of44 Industry Assessment 326 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions Prestariang Group has the advantage of being able to conduct their professional ICT training and certification in public tertiary education institutions in Malaysia as well as in National Institute of Public Administration (INTAN) training centres provided by the Public Service Department in various parts of Peninsular and East Malaysia. • Economies of Scale Economies of scale are an important competitive factor as they enable operators to be price competitive and at the same time able to obtain an adequate profit margin to sustain the business. Economies of scale through the training of large number of participants would also enable operators to expand its facilities including training centres, training equipment and course materials to attract new participants. Prestariang Group has the economies of scale to compete effectively. As at 30 April 2011, Prestariang Group had successfully trained approximately 18,790 participants from public tertiary education institutions for its professional ICT training and certification services since 2006.
10.4 Competitive Intensity • Professional ICT Training and Certification Competition among operators in the ICT training and certification industry is moderate based on the following considerations: Factors that intensify competitive pressure Operators compete against web-based training from operators anywhere in the world; Participants can opt for self-learning using publicly available course materials; Product owners also provide web-based training and course materials directly to participants. Factors that moderate competitive intensity The number of service providers of professional ICT training and certification is low relative to the potential size of the number of employees in ICT industry; Classroom-based training with instructors has significant advantages over web-based learning and self-learning; Winning Government contracts to service a large number of participants would reduce significantly the competitive intensity. Prestariang Berhad Page 26 0{44 Industry Assessment 327 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Distribution of Proprietary Software Licences. Competition among operators that are involved in the general distribution of proprietary software licences is intense based on the following considerations: There are many distributors including large and small organisations as well as large and small retail outlets; There are many methods of proprietary software licence distribution including OEM Pack, Box Pack/shrink-wrapped through retail stores, online and volume purchases; There is no product differentiation, as all distributors would be distributing exactly the same product; Due to the common usage of proprietary software, virtually no value­adding or support services are required.
However, the competitive intensity for the management and distribution of proprietary software licences to government bodies and large organisations is low. This is because of the following considerations: The number of operators that are able to manage and distribute to large private and public organisations are few; There are significant value-adding in the management of proprietary software licences, which among others, include keeping current the inventory of all licences under management, implementing a programme for updating software licences, and having a system for adding and deleting software licences; Operators that are able to distribute and manage proprietary software licences to large organisations are authorised by product owners. Product owners normally authorise only a small number of organisations to distribute and manage their proprietary software licences to large organisations. In many cases, product owners will do their own distribution and management to large organisations, and not have any authorised third parties.
10.5 Operators in the Industry 10.5.1 Providers of ProfessionallCT Training and Certifications • Professional ICT Training and Certification Some operators engaged in the provision of professional ICT training and certification (for various technology and software vendors) in Malaysia are as follows (listed in alphabetical order): ACA Pacific Technology (M) Sdn Bhd; Advanced Technology Studies Centre Sdn Bhd; Allied View Centre Sdn Bhd; Asia Pacific Institute of Information Technology Sdn Bhd (APIIT); iTrain (M) Sdn Bhd; Precision Design Solution (M) Sdn Bhd; Prestariang Group.
Note: This is not an exhaustive list. Prestariang Berhad Page 27 of 44 Industry Assessment 328 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Microsoft Certified Partners for Learning Solutions Prestariang Group provides ICT training for Microsoft products. Microsoft Certified Partners for Learning Solutions in Malaysia are as follows (listed in alphabetical order): Asia Pacific Institute of Information Technology Sdn Bhd (APIIT); Asia Talk Sdn Bhd; EC iTrain Sdn Bhd; Guidance View Sdn Bhd; Info Trek Sdn Bhd; I-Skill Dynamics Sdn Bhd; Iverson Associates Sdn Bhd; MCSB Systems (Pg) Sdn Bhd; New Horizons Malaysia; Nota Asia (M) Sdn Bhd; Prestariang Group; Redynamics Asia Sdn Bhd; Wilderness Empowerment Sdn. Bhd.

10.5.2 Providers of Professional Engineering Software Training • Autodesk Authorised Education Resellers Prestariang Group provides training for Autodesk engineering software products. Autodesk authorised education resellers in Malaysia are as follows (listed in alphabetical order): ACA Pacific Technology (M) Sdn Bhd; ACAD Systems Sdn Bhd; Caddcam Solutions Sdn Bhd; Caveman Solutions Sdn Bhd; Drawbridge Technologies Sdn Bhd; i-Gentech Sdn Bhd; MLST Sdn Bhd; Prestariang Group; Progressive Computer Sdn Bhd; Synoedge Sdn Bhd.
(Note: Some of the above are sUb-distributors)
10.5.3 Providers of Testing Centres • Testing Centres for Microsoft Certifications Prestarial1g Group organises testing for various certification courses including those from Microsoft. Testing centres for Microsoft products in Malaysia are provided by Parametric and the facilities are provided by the following organisations: (listed in alphabetical order): Akmasaba Services Sdn Bhd; Alpine Reliance (M) Sdn Bhd; AMC The School of Business; Asia Pacific Institute of Information Technology (APIIT);
Prestariang Berhad Page 28 of44 Industry Assessment 329 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions Delmarco Sdn Bhd; Guidance View Sdn Bhd; Informatics Group; Inti Management Services Sdn Bhd; Iverson Associates Sdn Bhd; MCSB System (M) Bhd; Platronix Sdn Bhd; Politeknik Sultan Salahuddin Abdul Aziz Shah; Prestariang Group; Prometric Test Center; Redyanics Asia Sdn Bhd; Training Partners Pte Ltd.

10.5.4 Distributors of Proprietary Software Licences • Proprietary Software Licensing Services Some operators engaged in the distribution of proprietary software licences in Malaysia are as follows (listed in alphabetical order): ACA Pacific Technology (M) Sdn Bhd; Applied Business Systems Sdn Bhd; Axis Computers Sdn Bhd; CHASSasia (Malaysia) Sdn Bhd; CMG On-line Sdn Bhd; CSC Malaysia Sdn Bhd; Dell Asia Pacific Sdn Bhd; eNCoral Digital Solutions Sdn Bhd; Hewlett-Packard Sales (Malaysia) Sdn Bhd; Ingram Micro Malaysia Sdn Bhd; JardineOneSolution (2001) Sdn Bhd; Kenfil Malaysia Sdn Bhd; Mac City Sdn Bhd; Mesiniaga Berhad; MLST (M) Sdn Bhd; OED Technology Sdn Bhd; Patimas Computer Software Sdn Bhd; Persoft Group of Companies; Prestariang Group; Sapura Synergy (Malaysia) Sdn Bhd; SoftwareONE Experts Sdn Bhd. Note: This is not an exhaustive list. • Large Account Resellers for Microsoft Products Prestariang Group is also engaged in software licence distribution for Microsoft products in Malaysia. Operators that are authorised Microsoft Large Account Reseller in Malaysia are as follows: (listed in alphabetical order): CHASSasia (Malaysia) Sdn Bhd; CSC Malaysia Sdn Bhd; Prestariang Berhad Page 29 0’44 Industry Assessment 330 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) o VITAL FACTOR CONSULTING Creating Winning Business Solutions Dell Asia Pacific Sdn Bhd; Hewlett-Packard Sales (Malaysia) Sdn Bhd; JardineOneSolution (2001) Sdn Bhd; Mesiniaga Berhad; Prestariang Group; Sapura Synergy (Malaysia) Sdn Bhd; SoftwareONE Experts Sdn Bhd.
• Resellers for Autodesk Education Software Licences Prestariang Group is also engaged in software licence distribution for Autodesk products in Malaysia. Operators that are authorised resellers of Autodesk education software licences in Malaysia are as follows: (listed in alphabetical order): ACA Pacific Technology (M) Sdn Bhd; ACAD Systems Sdn Bhd; Caddcam Solutions Sdn Bhd; Caveman Solutions Sdn Bhd; Drawbridge Technologies Sdn Bhd; i-GentechSdn Bhd; MLST Sdn Bhd; Prestariang Group; Progressive Computer Sdn Bhd; SynoedgeSdn Bhd.
(Note: Some of the above are sub-distributors) (Source: Vital Factor Consulting Sdn Bhd) Prestariang Group primarily services the Government and Government-related entities. Operators listed above compete in the respective areas as indicated above. However, to service Government and Government-related entities would normally require registration with the Ministry of Finance. The large majority of the above mentioned operators service Government and Government-related entities for a diverse range of products and services, some of which would be similar to those offered by Prestariang Group. 11.BARRIERS TO ENTRY 11.1 Government Contracts • Government contracts form a relatively high barrier to entry for new entrant wishing to secure Government contracts in the provision of ICT training and certification, and distribution of software licences.
• This is because Government contracts for anyone specific area are commonly awarded to only one or very small number of product or service providers. As such, the selection criteria are stringent, and a new entrant without track record would find it difficult to win such Government contracts.

PrestariangBerhad .Page30 of44 IndustryAssessment 331 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • In addition, Government contracts are commonly of high value and duration of at least a year or until such time an agreed threshold is reached.
11.2 Certified Training Partners of Vendors • Barriers to entry to be a certified training partner of global and recognised software and technology vendors, for example Microsoft, are moderate.
• This is because many of these global software and technology vendors set stringent requirements before a company is certified as a partner for the provision of training and certification of their respective software or technologies;
• Some of these requirements include haVing the following: certified test centres; certified trainers; certified master trainers; certified software/technical engineers to provide technical support.
• As such, a new entrant would need to build up its technical personnel base and have them certified before the company can seek certification as a training partner for global software and technology vendors.

 

11.3 Set-up Costs Professional ICT Training and Certification • Set-up costs generally represent a lowbarrier to entry for a new entrant that wishes to operate as a provider of professional ICT training and certification services. This is because operators may opt to provide the courses in third party premises instead of setting up training centres. Alternatively, if an operator wants to set up its own training centre, it can lease premises.
• In addition, cost of equipment for the provision of professional ICT training is low and mainly comprises LCD projectors and computers.

Proprietary Software Licensing Services • Set-up costs represent a low barrier to entry for a new entrant that wishes to operate as a distributor of proprietary software licences. This is because all that is required is an office or an existing retail outlet to distribute proprietary software licences.
11.4 Skills and Knowledge Base • Depending on the business model of an operator who wishes to provide professional ICT training and certification, the knowledge and skill base required can be both high as well as low: Barriers to entry are high if the operator decides to have in-house employee instructors for a wide range of ICT courses; Prestariang Berhad Page 31 of 44 Industry Assessment 332 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTII\lG Creating Winning Business Solutions Barriers to entry are low if the operator decides to use third party instructors for most of its course offerings. 11.5 Track Record and Market Reputation • Track record and market reputation create barriers to entry for new entrants wishing to provide professionallCT training and certification.
• This is because the quality of instruction would very much be dependent on the quality of the instructors and support provided by the company. In this respect, established providers of professional ICT training and certification with a proven track record have an advantage over new entrants.
• Track record and market reputation is also a major barrier to entry particularly when bidding for contracts from the government or large private organisations.

12. RELIANCE ON AND VULNERABILITY TO IMPORTS 12.1 ProfessionallCT Training and Certification • Product and technology owners normally provide training materials for third party organisations to conduct training on their products or technologies. All of the product and technology owners are from overseas.
• As such, operators of professional ICT training and certifications are reliant on imports.
• Despite the high reliance on imports, local operators are not overly vulnerable as it is unlikely that any product or technology owners will stop providing training materials and stop certification of participants. This is because it is in the interest of product or technology owners to train and certify as many competent people as possible to increase demand for their products or technologies or to provide technical support to users of their products or technologies.

 

12.2 Proprietary Software Licensing Services • Local distributors of proprietary software licences are reliant on imports of third-party software. This is because virtually all the popular proprietary software are from overseas.
• Despite the high reliance on imports, local distributors are not overly vulnerable as overseas owners rely on local distributors to help distribute their products.
• However, there may be situations where product or technology owners may undertake their own distribution, particularly for large accounts.

Prestariang Berhad Page 32 0’44 Industry Assessment 333 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions 13. INDUSTRY OUTLOOK

 

 

13.1 Overall Favourable Outlook • In general, the outlook of the ICT Services Industry including the provision of professional ICT training and certification, and distribution of proprietary software licences in Malaysia is favourable. This is substantiated by the following: Favourable economic conditions; Stimulus from the 2011 Budget; Increasing expenditure on public education; Growth in public education institutions and student enrolment; Growth Provided by the 10th Malaysia Plan; Positive impact of the Economic Transformation Programme.

13.2 Favourable Economic Conditions • There are strong indications that economic conditions in Malaysia are improving from the negative effects of the global financial crisis that began in mid-2007. This is supported by the following observations: Real GDP for Malaysia is forecasted to grow between 5.0% and 6.0% in 2011. While real GDP of the services sector recorded a growth of 6.8% in 2010, the sector is estimated to grow by 5.9% in 2011. (Source: Bank Negara Malaysia) • Improving economic conditions would augur well for ICT service providers inclUding those involved in the provision of professional ICT training and certification, and distribution of proprietary software licences. 13.3 Stimulus from the 2011 BUdget • The 2011 Budget had provided for substantial spending to drive economic growth in general and also to develop human capital through education and training.
• In the 2011 BUdget, education and training will be restructured and strengthen, as human capital development is a prerequisite towards achieving developed and high-income nation status. There is a sum of RM29.3 billion allocated for the Ministry of Education and RM10.2 billion for the Ministry of Higher Education and RM627 million for the Ministry of Human Resources. (Source: The Budget 2011 Speech)
• In addition, there are budget allocations for intensifying training and skills programmes for 2011, which include:

Prestariang Berhad Page 33 of44 Industry Assessment 334 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions RM60 million allocation to further intensify the Industrial Skill Enhancement Programme in State Skills Development Training Centres. This will enhance skills of engineering graduates and technical employees in line with market requirements. The Industrial Skill Enhancement Programme is a training and development programme in the engineering, ICT and management fields to enhance the employability of graduates; RM220 million allocation to ensure graduates from other fields are able to enhance their competency and employability, which comprise professional certification programmes, sports development, entrepreneurship development and graduate employability management scheme; RM50 million allocation to Multimedia Development Corporation to train graduates in ICT to enhance their employability and to meet the demand of the ICT industry. • One of the Government’s efforts in achieving Malaysia’s target to become a high-income nation is by enhancing the ICT industry. Various initiatives have been introduced by the Government to spur the ICT industry, including: The implementation of MY Creative Content Programme to encourage the development of local content creation, hosting local content and unlocking new channels for content; RM 119 million allocation for the MY Creative Content Programme. (Source: The BUdget 2011 Speech) • The various amount of budget allocation to education and training, and particularly in the ICT area would provide growth opportunities for operators in the professional ICT training and certification sector. In turn, this will also stimulate demand for proprietary software licences.
13.4 Increasing Expenditure on Public Education • Demand for professional ICT training and certification particularly in the public education sector, would depend on Government expenditure in the education sector in Malaysia. Total Federal Government Expenditure on Education Between 2005 and 2009, the total federal government expenditure on education (excluding expenditure for the Ministry of Higher Education) increased at an average annual rate of 13.4%. In 2009, the total federal government expenditure on education grew by 5.7% to reach RM28.8 billion. (Source: Department of Statistics) Prestariang Berhad Page 34 of44 Industry Assessment 335 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) o VITAL FACTOR CONSULTII\lG Creating Winning Business Solutions Total Federal Government Development Expenditure on Education Between 2006 and 2010, the total federal government development expenditure on education increased at an average annual rate of 22.5%. In 2010, the total federal government development expenditure on education grew by 11.3% to reach RM12.0 billion. (Source: Bank Negara Malaysia) • The increase in spending on public education by the Malaysian Government would provide growth opportunities for service providers of professional ICT training and certification including operators like Prestariang Group. In turn, this will also stimulate demand for proprietary software licences.
13.5 Growth in Public Education Institutions and Student Enrolment • The growth in the number of pUblic higher learning institutions and the number of students would provide growth opportunities for service providers of professionallCT training and certification that targets public higher learning institutions. Public Higher Learning Institutions In 2010, there were a total of 20 public universities in Malaysia, representing an average annual growth rate of 10.8% between 2005 and 2010. Between 2006 and 2010, the total number of community colleges, including branch campuses, in Malaysia increased at an average annual rate of 18.9%. In 2010, the total number of community colleges grew by 9.4% to reach 70 campuses. In 2010, there were a total of 27 polytechnic institutions in Malaysia, representing an average annual growth rate of 6.5% between 2006 and 2010. (Source: Ministry of Higher Education) Student Enrolment in Public Higher Learning Institutions Between 2006 and 2010, the total number of students enrolled in public universities in Malaysia increased at an average annual rate of 8.7%. In 2010, the total number of students enrolled in public universities grew by 5.8% to reach 462,780 students. Between 2006 and 2010, the total number of students enrolled in community colleges in Malaysia increased at an average annual rate of 12.7%. In 2010, the total number of students enrolled in community colleges grew by 5.3% to reach 18,200 students. Prestariang Berhad Page 35 of44 Industry Assessment 336 11. INDEPENDENT MARKET RESEARCH REPORT (Conf’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions Between 2006 and 2010, the total number of students enrolled in polytechnic institutions in Malaysia increased at an average annual rate of 1.7%. In 2010, the total number of students enrolled in polytechnic institutions grew by 1.5% to reach 87,751 students. (Source: Ministry of Higher Education) 13.6 Growth Provided by the 10th Malaysia Plan • The 10th Malaysia Plan, a framework that lists various targets and plans by the Malaysian Government for the sole purpose of economic development to be executed from the year 2011 to 2015, is expected to provide further impetus for growth to the ICT Services Industry.
• The Malaysian Government has identified new sources of economic growth, termed as National Key Economic Areas (NKEA), in line with its plans to shift the economy towards higher value-added activities. The NKEA include, among others:
Education; ICT.
• In order to develop and improve the NKEA, the government encourages operators in each sector to invest in technological advancements, including ICT products and services, to improve the delivery and quality of their products and services, as well as, enhance the competency, creativity and innovation aspects of teachers, students and graduates.
• In addition, total Federal Government development allocation for the 10th Malaysia Plan is RM230.0 billion. The breakdown of the development allocation is as follows:
RM126.5 billion or 55% for the economic sector; RM69.0 billion or 30% for the social sector; RM23.0 billion or 10% for the security sector; RM11.5 billion or 5% for general administration.
• The ICT sector, which accounted for 9.8% of Malaysia’s GDP in 2009, is expected to contribute 10.2% of the GOP by 2015.

(Source: 1dh Malaysia Plan)
13.7 Positive Impact of the Economic Transformation Programme • The Economic Transformation Programme (ETP) is a progressive framework identifying various economic sectors and strategies in transforming Malaysia into a high-income and developed nation by 2020. The ETP was introduced on 25th October 2010 by the Malaysian Government and is currently managed by the Performance Management and Delivery Unit (PEMANDU), which fall under the purview of the Prime Minister’s Department. Prestariang Berhad Page 36 of 44 Industry Assessment 337 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR COI\lSULTII\lG Creating Winning Business Solutions • Twelve drivers of economic growth, termed as National Key Economic Areas (NKEA), are expected to contribute to Malaysia’s transformation target. The NKEA include, among others:
Education; Communications, Content and Infrastructure (CCI).

• Under the Education banner, the key focus of the Government is on strengthening and supporting the private education sector that includes private teacher training and information technology services, as growth opportunities from the public education sector is expected to be limited. The gross national income (GNI) contribution from the education sector is earmarked to grow from RM27.1 billion in 2009 to RM60.7 billion in 2020. A total of RM19.9 billion would be required to fund various projects that would spur the education sector’s growth.
• The CCI sector, which covers a wide range of ICT offerings that include content and information, network and applications, is expected to contribute RM57.7 billion of GNI by 2020 from RM22.0 billion in 2009. The growth of the CCI sector would require a total of RM51.5 billion worth of funding.
• The Malaysian Government has identified human capital development as a critical success factor of the ETP to support Malaysia’s progress towards becoming a high-skilled, knowledge-based and innovation-intensive economy. Both the Education, and Communications Content and Infrastructure sectors are key enablers of human capital development.

(Source: Economic Transformation Programme) 14. THREATS AND RISKS ANALYSIS

14.1 Global Financial Crisis • Any prolonged and/or widespread economic downturn such as those of the recent global financial turmoil has affected the global and Malaysian economies. This will in turn reduce business confidence. Mitigating Factors • As evidenced in the past, the Malaysian Government’s continued prompt policy flexibility in implementing pro-growth measures to sustain the country’s growth momentum, by raising domestic demand to compensate for slower external growth, has helped Malaysian companies to counter some of the effects of the slowdown in the global economy.
• In early November 2008, the Malaysian Government announced a RM7 billion stimulus package, which was to be channeled into 15 projects to promote business activity, and helps minimise the impact of the global financial crisis.

Prestariang Berhad Page 37 of44 Industry Assessment 338 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • On 10 March 2009, the Government tabled a mini budget as part of the second stimulus package. The second stimulus package was to be implemented over 2009 and 2010, and included RM60 billion in spending and incentives.
• It was expected that these measures will help to generate domestic business activities and domestic consumption, which will in turn help counter the slowdown in the local economy.

14.2 Advances in Technologies and Products • The generally rapid rate of technological advances in ICT products and services may lead to the rapid obsolescence of, among others, hardware, software and ICT training and certification courses that are focused on outdated technologies and products.
• There is a risk that demand for an operator’s products and services may decline as newer technologies and products are developed and introduced.

Mitigating Factors • The ICT industry is dynamic and is constantly evolving. As technologies and products become obsolete, new or improved technologies and products will be created to replace them. These new and improved technologies and products will continue to provide business opportunities
• Operators in the ICT industry that constantly review and update their products and services to meet evolving technologies and product changes will continue to be relevant to meet the needs of the ICT industry and users of ICT.

 

14.3 Dependency on Certified Instructors • The operation of ICT training and certification is highly dependent on the knowledge and skills of instructors. Any shortages in certified instructors will have a significant impact on the business operations of ICT training and certification organisations. Mitigating Factor • Operators that make adequate efforts to look after their instructors in terms of remuneration and work conditions would be in a better position to attract as well as to retain good instructors. In addition, operators that continually provide training to improve their instructors’ competence would be in a better position to mitigate against this risk. Prestariang Berhad Page 38 of44 Industry Assessment 339 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR COI\lSULTING Creating Winning Business Solutions
14.4 Changes in Distribution Methods for Proprietary Software Licences • Currently proprietary software licences are distributed via many methods. They include retail outlets, distributors for volume purchases, bundled with hardware and software, and through the Internet.
• There is a risk that the distribution of proprietary software licences may eventually be substantially through the Internet. Alternatively, product and technology owners may decide to undertake their own distribution. This could have a negative impact on eXisting distributors.
Mitigating Factor
• Operators that are able to provide value-adding services on top of distribution of proprietary software licences will be in a better position to continue to be relevant. Value adding could include the management of software licences, which covers procurement, keeping accurate inventory, ensuring licensing compliance, managing updates and new software, provision of training and certification, and others.

 

14.5 Availability of Freeware • Freeware is software that users can legally use without paying any fees to the owner of the software’s intellectual property rights. An example of freeware is an Internet-based email application. The ready availability of freeware is a risk to operators, inclUding providers of software licences, who charge a fee to users for the use of the software. Mitigating Factors • In general, the range of freeware that is currently available is limited to more generic and basic applications. Developers of freeware are typically unable to provide users with value-added services such as consulting services, customisation, or to offer managed services and extensive technical support.
14.6 Software Piracy • Software can be easily copied, replicated and distributed. Unauthorised copying, replication and distribution deny revenue that is due to the owners of the software, which may have a negative effect on their financial performance. Mitigating Factor • There is a strict stance on curbing software piracy through various Government efforts including the introduction of various legislations, such as, the Trade Marks Act 1976, Patents Act 1983 and Copyright Act 1987, and confiscation of pirated software to safeguard intellectual property rights, which encourages consumers to acquire proprietary software licences through legitimate channels and sources. Prestariang Berhad Page 39 of44 Industry Assessment 340 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTII\lG Creating Winning Business Solutions • Providers of software licensing services that have secured contracts with customers are able to mitigate the risk posed by software piracy. Furthermore, suppliers of pirated software are not able to provide recognised ICT training. Users of pirated software will not be able to obtain recognised ICT certification, which can only be granted by technology and software vendors. 15. AREAS OF GROWTH AND OPPORTUNITY

15.1 Overseas Markets • There are opportunities for providers of professional ICT training and certification based in Malaysia to extend their services to users located throughout the world.
• With students worldwide keen on developing their ICT skills, there will be ample demand for professionallCT training and certification.

 

15.2 Managing Hardware Suppliers • Major operators involved in the distribution and management of proprietary software licences can also offer their services to hardware manufacturers and suppliers. This group of businesses commonly bundle their hardware with software for the convenience of their customers. As such, there are opportunities to provide an efficient distribution and management system to ensure proper software licensing compliance by hardware manufacturers and suppliers. 16. DRIVERS OF GROWTH Some of the drivers of growth for the ICT Services Industry focusing on ICT training and certification, and distribution of proprietary software licences are as follows: • Government spending and budget allocation for human capital development activities as reflected in the 2011 Budget, 10th Malaysia Plan and expenditure on public education will continue to provide growth opportunities for service providers of ICT training and certification. This is in line with the Government’s initiatives to enhance human capital development, which will promote the demand for ICT training and certification. This will also help to address deficiencies in competency levels of graduates to improve their employability.
• Socio-economic growth such as GDP and population growth, and increased wealth will drive business and social activities which will in turn increase usage of ICT. Increases in the usage of ICT will help create demand for ICT training and certification to meet commercial requirements, and at the same time increase demand for proprietary software licences for users of ICT hardware and applications.

Prestariang Berhad Page 40 of 44 Industry Assessment 341 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR CONSULTING Creating Winning Business Solutions • Increase in broadband penetration will stimulate growth in products and services pertaining to the Internet. As more people get access and use broadband services, this will drive demand for products like personal computers and notebooks, as well as software to operate hardware and to process information. As such, increasing broadband penetration will drive growth for ICT training and certification, as well as distribution of proprietary software licences.
• Advancement in technology and technological products and services will stimulate demand for professional ICT training and certification as graduates and professionals need to constantly upgrade and update their skill and knowledge base to remain relevant. Advancement in technology will also drive demand for proprietary software licences, as users continually need to upgrade their computer systems.
• The Human Resources Development Fund (HRDF), under the Ministry of Human Resources, was set up with the intention of promoting retraining and skills upgrading of the workforce. The mandatory requirement for certain businesses in selected industries to continually provide training to their employees will help increase demand for leT training and certification.
• Stricter stance on curbing software piracy through various Government efforts will encourage consumers to acquire proprietary software licences through legitimate channels and sources.

Between 2005 and 2009, the number of cases involving copyright piracy activities (including pirated software) in Malaysia decreased at an average annual rate of 30.3%. In 2009, the number of cases declined by 53.6% to 902 cases. (Source: Ministry of Domestic Trade, Co-operatives and Consumerism) 17. CRITICAL SUCCESS FACTORS The critical success factors for providers of professional ICT training and certification include the following: • Availability of Certified Instructors The availability of certified instructors is critical when conducting classroom­based training. The lack of certified instructors may mean inability to take on new participants, having too many participants per class, and inability to commence new training courses. Prestariang Berhad Page 41 of 44 Industry Assessment 342 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) o VITAL FACTOR CONSULTING Creating Winning Business Solutions • Quality of Instructors With classroom-based ICT training, the quality of instructors is important. This is because participants have choices of other classroom-based operators or undertake self-learning or distant learning through the internet. As such, the key differentiator of classroom-based training is the quality of its instructors. The success of a professional ICT training and certification service provider is highly dependent on the expertise and competence of its certified instructors. Instructors should be knowledgeable and able to disseminate information effectively. Hence, keeping and attracting good instructors are critical. • Network of Training Facilities
Classroom-based training requires facilities. Having a wide network of facilities would increase the coverage of potential participants, as participants will require to attend classes. As such, the number and the spread of facilities will determine the potential addressable market for operators.
• Wide Range of Training and Certification Modules
A wide range of training and certification modules is critical to ensure business viability as well as for economies of scale to attain sufficient profit margin. Operators that provide a wide selection of professional ICT training and certification are able to cater to diverse customers’ needs.
• Established Track Record and Market Reputation

Organisations and participants have choices, and would normally select operators with an established track record and a good market reputation in the provision of professional ICT training and certification. As such, operators with strong track record would be in a better position to win the confidence and trusts of potential participants, and secure new contracts from organisations. The critical success factors for the distribution and management of proprietary software licences include the follOWing: • Servicing Large User Groups The distribution of proprietary software is likened to the distribution of a commodity product. There is very little that a distributor can do to the product as proprietary software is designed to be sold on its own. As such, an operator will have to service large user groups to cover operating expenses as well as to obtain economies of scale to attain an adequate profit margin. Prestariang Berhad Page 42 0’44 Industry Assessment 343 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d) Q VITAL FACTOR COI\lSULTII\lG Creating Winning Business Solutions • Value Adding Operators must provide value adding if the distribution of proprietary software is to be a major revenue and profit stream for them. This is because the amount earned for the sales of each proprietary software licence is low and will require to be supplemented from other sources or to complement sales of other products and services. • Representing Multiple Product Owners The amount earned from the distribution of each software licence is low. Thus, representing multiple product owners of proprietary software is critical to increase the volume of sales to ensure business viability as well as economies of scale to improve profit margin. 18. MARKET COVERAGE, SIZE AND SHARE 18.1 Market Coverage • As at end of 2010, Prestariang Group was servicing approximately 44% out of a total of 117 public higher education institutions, including public universities, polytechnics and community colleges, in Malaysia. (Source: Vital Factor Consulting Sdn Bhd)
18.2 Market Size • In 2010, the market size of the computer services sub-sector based on spending was RM7.9 billion.
• In 2010, the market size of the computer software sub-sector based on spending was RM4.8 billion.

(Source: Secondary Market Research undertaken by Vital Factor Consulting Sdn Bhd)
18.3 Market Share • In 2010, Prestariang Group had a market share of less than 1% of the computer services sub-sector in Malaysia. This is based on the Group’s revenue for the provision of professional ICT training and certification, and software licence distribution and management services for the financial year ended 31 December 2010.
• In 2010, Prestariang Group had a market share of less than 1% of the computer software sub-sector in Malaysia. This is based on the Group’s revenue for software licence distribution and management services for the financial year ended 31 December 2010.

(Source: Vital Factor Consulting Sdn Bhd) Prestariang Berhad Page 43 0’44 Industry Assessment 344 11. INDEPENDENT MARKET RESEARCH REPORT (Cont’d)

 

o VITAL FACTOR CONSULTING Creating Winning Business Solutions Vital Factor Consulting Sdn Bhd had prepared this report in an independent and objective manner and had taken all reasonable consideration and care to ensure the accuracy and completeness of the report. It is our opinion that the report represents a true and fair assessment of the industry within the limitations of, among others, secondary statistics and information, and primary market research. Our assessment is for the overall industry and may not necessarily reflect the individual performance of any company. We do not take any responsibilities for the decisions or actions of readers of this document. This report should not be taken as a recommendation to buy or not to bUy the shares of any company. Yours sincerely
Wooi Tan Managing Director Prestariang Berhad Page 440(44 Industry Assessment 345

Comments are closed