MyEG optimistic about its prospects

PETALING JAYA: MyEG Services Bhd remains optimistic about its prospects, particularly its Philippines joint venture (JV) and e-bidding for new car number plates, say analysts.

According to CIMB Research, the positive or potentially positive developments for MyEG is that it holds the concession for e-bidding service for new car number plates, the current monitoring system meant for goods and services tax could be revived by the new government for sales and services tax, submission of a proposal to handle online registration for new foreign workers, as well as the Philippines JV which could tie up with a regional bank to provide micro loans.

MyEG and Konsortium Multimedia Swasta Sdn Bhd hold the concession for e-bidding service for new car number plates.

This service is targeted to start from January 2019 onwards.

“We estimate the market for this e-bidding service is small, at only RM3mil annual revenue.

“On average, 1.5 million new cars and motorcycles are purchased annually and MyEG or KOMMS will only charge RM2 for every successful bid,” said CIMB Research, adding that MyEG has finally received approval for this e-bidding service with the new Pakatan Harapan coalition, after bidding for this concession for many years.

It added that using big data analysis, MYEG could potentially sell new car insurance to the new car buyers, offer to sell the customers’ existing cars through its secondhand car portal my motor. my, as well as sell car accessories to the new car buyers.

The first trial for this e-bidding service will sell the “Malaysia” number plates from early July onwards.

Apart from that, MyEG gas submitted a proposal to handle online registration of new foreign workers.

If successful, the company will become a convenient “one stop centre” for employers of foreign workers.

It is estimated that MyEG can generate a revenue of RM1,000 per foreign worker, and around 300,000 new foreign workers enter the country annually.

“This new service could boost MyEG’s financial year 2019 (FY19) to FY20 forward net profit by 17% to 18%,” said CIMB Research.

MyEG Philippines JV, of which 40% is held by MyEG, is currently handling 20,000 e-government transactions daily.

The MyEG JV could get a US$25 commission for every micro loan of US$1000 approved, and will not be involved in managing these loans.

CIMB Research has an Add call with a target price of RM1.22, while UOB KayHian has a Buy call with a target price of RM1.06.