MyEG / Wong Thean Soon

Re: MyEG / Wong Thean Soon

Postby winston » Wed Feb 28, 2018 9:16 am

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2QFY18: “Matching” service to boost revenue growth

■ At 40% of our full-year forecast, MyEG's 1HFY6/18 net profit was in line with our expectations as the 2H should be stronger on revenue from its “matching” service.

■ The registration of illegal foreign workers (IFWs) was completed at end-2017. We estimate MyEG registered 0.9m-1.0m IFWs in total.

■ It started a new service in Sep: matching employers with still-unregistered IFWs.

■ GST Phase 2 nationwide installation target to start mid-2018.

■ Remains an Add. Successful nationwide launch of GST monitoring Phase 2 project a potential re-rating catalyst.

Source: CIMB

https://brokingrfs.cimb.com/AWdX5H9yvAQ ... Vebig2.pdf
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Re: MyEG / Wong Thean Soon

Postby winston » Mon Apr 09, 2018 8:53 am

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CIMB Research lowers MyEG to Hold as most good news priced in

KUALA LUMPUR: CIMB Equities Research has downgraded My EG Services from Add to Hold, while maintaining the target price of RM3.04. The last traded price was RM2.79.

It said MyEG’s share price has outperformed both the KLCI and the KLSE Technology Index so far this year.

Year-to-date, the stock has risen more than 30% vs. KLCI’s 3%-4% gain and KLSE Technology Index’s 23.6% decline.

“We believe the latter's sharp decline YTD was mainly due to the fact that most technology companies' export revenues are in US$ and the ringgit has been strengthening against the US$ over the past few months,” it said.

CIMB Research said this was its first downgrade since it upgraded MyEG to an Add from Hold on April 24, 2014.

“We believe at current share price levels, most of the good news has already been reflected in its share price and we do not see any positive catalyst surprises over the next few months for the stock.

“Upside risk is successful launch of GST Monitoring (GSTM) Phase 2 while downside risk is delay in GSTM Phase 2 launch,” it said.

CIMB Research said with the registration of illegal foreign workers (IFW) completed end last year, it expects MyEG’s earnings growth to be driven by the GSTM project over the next one to three years.

Under the project, it gets RM1,000 per annum from the government for every outlet installed with its dongles (attached to cash registers). The goal of Phase 1 is to install dongles in 50,000 F&B outlets nationwide.

“We understand it had made the installation in over 20,000 F&B outlets in Klang Valley; the rest to be done in 2H18,” it said.

GSTM Phase 2 should be a major cash cow for the company. GSTM Phase 2, which would involve the retail sector, would see an estimated 500,000 retail outlets linked to the GSTM project and MyEG would also receive RM1,000 per outlet annually.

On full installation of Phase 2, MyEG gets RM500mil annually. Assuming 20%-25% profit before tax (PBT) margin, Phase 2 should contribute RM100mil to RM125mil PBT annually to the company.

CIMB Research has assumed GSTM Phase 2 to start from mid-2018F.

In January, MyEG received the approval from Bank Negara to issue electronic money. When the GSTM Phases 1 and 2 are in place, the country’s retail and F&B sector would be fully linked to the GSTM network.

“We believe MyEG would be able to derive some synergy from linking its electronic money to retail and F&B outlets nationwide.

“We have not assumed any potential earnings from the electronic money licence yet. Maintain EPS and target price, based on 25.2 times 2019F P/E, a 20% premium to the technology sector.

“The premium is to reflect its large market capitalisation and strong 36% CY18-20F EPS CAGR. However, there could be earnings disappointment for the company if there are any delays in the launch of GSTM Phase 2, targeted to start in mid-2018F,” it said.

Source: The Star

https://www.thestar.com.my/business/bus ... wjtYFcS.99
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Re: MyEG / Wong Thean Soon

Postby winston » Fri Apr 13, 2018 1:07 pm

Macquarie upgrades MyEG to outperform; price target RM3.15

(April 13): Macquarie analyst Anand Pathmakanthan upgraded the recommendation on My EG Services Bhd (MyEG) to outperform from neutral.

* Price target (PT) raised to RM3.15 from RM2.04, implies 20% increase from last close. MyEG average PT is RM2.97.

* MyEG had two buys, five holds, 0 sells previously.

* Analysts raised their consensus one-year target price for the stock by 18% in the past three months. Forecasts range from RM2.32 to RM3.75.

Source: Bloomberg

http://www.theedgemarkets.com/article/m ... rget-rm315
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Re: MyEG / Wong Thean Soon

Postby winston » Fri May 18, 2018 9:57 am

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MyEG has first-mover advantage, says MD

PETALING JAYA: Government service provider MyEG Services Bhd group managing director Wong Thean Soon said the company has spent close to RM150mil on its Goods and Services Tax (GST) programme, where it has acquired close to 20,000 dongles, and there are grounds to seek compensation should the programme be cancelled.

Wong is well known for his position as the managing director and single largest shareholder of MyEG Services Bhd, which had a market capitalisation of some RM7bil prior to the stock hitting limit down on Monday and Tuesday. MyEG, which has lost close to RM3bil in market cap, is seen to be related to the previous ruling party.

Wong owns some 30.26% of MyEG via his vehicle Asia Internet Holdings Sdn Bhd, and 7.76% under his name.

In a lunch hosted for investors yesterday in its office, Wong said all of MyEG’s contracts have agreements behind them, although the one with the highest risk is the GST contract.

“We have not recognised any revenue (from the GST contract). Everything else is business as usual. We have not had a chance to speak to any government official,” he told the 28 attendees yesterday.

Wong said that typically, MyEG negotiates for the renewal of its contracts a year before its expiry. The GST contract expires in 2020, hence negotiations should take place next year.

He added that other players can certainly replicate what MyEG does, although he feels that MyEG can compete efficiently and effectively. Its first-mover advantage is another huge plus point.

“Do I think we can work with the new government? Yes, I think we can. I believe we can establish a good relationship. MyEG is one of the government's flagship MSC projects and I think we are probably the only one still left. Remember that MSC is Tun Dr Mahathir Mohamad’s initiative. I cannot proclaim that this is rocket science but it takes time, operational time to put things in place,” he said.

When asked whether MyEG was going to make itself politically neutral, Wong believes that will not be the case.

“We have to be close to the government of the day as we are a government e-service provider,” he told the investors.

Wong believes there is no need to see a change in MyEG’s shareholding.

MyEG will be hosting a Ramadan event for Tun Mahathir next week.

On MyEG’s longer-term outlook on its earnings, Wong said he cannot say for sure because he is uncertain what the government policies are going to be.

“Right now, we are just going on with business as usual. All these contracts are under the e-government flagship but some of our services are added on – I am not sure the added-on services can be for open tender,” he added.

On Wednesday, Bursa said in an announcement that MyEG’s lower limit price was RM1.27 following two consecutive days of the stock hitting limit down.

MyEG’s last traded price before GE14 was at RM2.58 on May 8. As of 12.30pm on Thursday, MyEG was down 17 sen to RM1.10 on volume of 248.49 million shares.

Source: The Star

Read more at https://www.thestar.com.my/business/bus ... WRS6G8F.99
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Re: MyEG / Wong Thean Soon

Postby winston » Fri May 18, 2018 2:13 pm

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MyEG rebounds in active trade as top brass defend company’s prospects

by Sulhi Azman

KUALA LUMPUR (May 18): MY EG Services Bhd (MyEG), which came under intense selling pressure since the end of the general election, rebounded and emerged as the most actively traded counter on the local bourse this morning, after its top brass recently come out to say that the company has a first-mover advantage.

Since the local bourse’s opening bell today, MYEG saw 108.05 million shares exchanging hands, equivalent to 3% of its share capital.

This morning, the counter opened at RM1, and jumped by as much as 3%, before paring down its gain to 95.5 sen at 10am today, for a market capitalisation of RM3.44 billion.

Since the conclusion of the 14th general election on May 9. MYEG, which was perceived to be linked with the ousted Barisan Nasional-led government and involved in a goods and services tax (GST)-related projects, has fallen by 63.91%, with RM5.8 billion wiped out from its market capitalisation.

The stock is currently trading at the lowest point, since the last 2.5 years, according to Bloomberg data.

Yesterday, MYEG group managing director Wong Thean Soon was reported to have told analysts in a close-door meeting and defended the stock as having a first-mover advantage, which is a huge plus point that will enable it to compete efficiently and effectively in the electronic government services sector.

“Do I think we [MYEG] can work with the new government? Yes, I think we can. I believe we can establish a good relationship. MyEG is one of the government's flagship MSC [multimedia super corridor] projects and I think we are probably the only one still left,” Wong was quoted as saying.

“Remember that MSC is Tun Dr Mahathir Mohamad’s initiative. I cannot proclaim that this is rocket science but it takes time, operational time to put things in place,” he had added.

Meanwhile, Credit Suisse Securities Malaysia Sdn Bhd was reported to be the latest investment firm to join CIMB Investment Bank Bhd to downgrade MYEG shares to “underperform” from “neutral”, and slashed the 12-month target price to 90 sen, from RM2.70 previously.

On May 13, an analyst at CIMB has told its clients that it has downgraded MyEG to “reduce” from “hold”, as the company is at risk of losing future earnings from its GST monitoring project, in which the tax is expected to be scrapped by the newly-formed government over the next 100 days.

Source: The Edge

http://www.theedgemarkets.com/article/m ... -prospects
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Re: MyEG / Wong Thean Soon

Postby winston » Fri May 18, 2018 3:10 pm

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UOB Kay Hian Research upgrades MyEG to Buy on weakness

KUALA LUMPUR: UOB Kay Hian Malaysia Research has upgraded MyEG Services to buy on weakness as the government service provider’s risk-reward profile has turned positive with share price having plunged 65% over the past few days to trade close to its assessed trough value of 84 sen.

In its report issued on Friday, it said this comes on the back of heightened fears of political risks, following Pakatan Harapan’s general election win last week.

“The risk of its GST monitoring system being scrapped has been fully discounted, and more importantly, we foresee the concession of its efficient e-government portal being continued.

“However, we cut our target price to RM1.06 to acknowledge the fluidity of sentiment,” it said.

To recap, MyEG shares plunged 65% this week, closing marginally above the third limit down price of 89 sen.

UOB Kay Hian Research said MyEG was already trading at two standard deviation (SD) below its historical price-to-earnings (PE).

It pointed out that MyEG already traded close to its current assessed trough valuation of 84 sen, based on 10 times forward core PE.

Based on its assumptions, foreign worker-related services and road transportation account for approximately 75% and 20% of FY19 revenue respectively.

Specifically, government-related services contributed about 20% of FY17 revenue, with the remaining top-line coming from MyEG’s added-on services for the e-government concessions, primarily insurance.

“ In a worst-case scenario, MyEG could potentially lose its monopoly in e-government concessions while its added-on services could possibly face an open tender threat.

“As such, assuming a 30% market share loss each in its e-government concessions and added-on services, MyEG’s FY19 and FY20 core net profit would fall by a range of 29%-39%.

“MyEG bought back 10 million shares at RM1.27 on Tuesday, and another 20 million shares at RM1.07 on Wednesday, cumulatively representing 0.8% of its paid-up capital,” it said.

UOB Kay Hian Research prior to the recent buybacks, MyEG had only 10 million of treasury shares. MyEG had a net cash position of RM115.8mil as at 2QFY18.

Source: The Star

https://www.thestar.com.my/business/bus ... whuRz7J.99
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Re: MyEG / Wong Thean Soon

Postby winston » Fri May 18, 2018 3:31 pm

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MyEG boss states case for new govt to continue using company’s services

by Tee Lin Say

PETALING JAYA: Government service provider MyEG Services Bhd managing director and single largest shareholder Wong Thean Soon does not see any reason for the new Pakatan Harapan government not to continue using MyEG as the service provider for e-government services.

Presently, MyEG’s various projects are grouped under the e-government concession which was awarded in the year 2000.

“MyEG, as a service provider to the government, has to work for the government of the day.

“We believe that we are a professional organisation that will continue to provide a high level of service to the government, moving forward,” said Wong.

Having said that, Wong added that MyEG is at the service of the government, and hence whenever the government wishes to discuss its new policies or requirements, MyEG will always be ready.

On the lesson to be learnt from this whole experience, Wong said that the rakyat and consumers are king, whether in politics or business.

On what MyEG can offer the new government, Wong said simply: “We offer a highly efficient service at a very competitive rate.

“I see opportunities in everything, whether during good or bad times. I am an optimist, I guess,” he said.

He added that there were no plans for management to change its shareholding significantly.

MyEG, which had a market capitalisation of some RM9bil prior to the 14th general election (GE14), has lost close to RM6bil in market cap over the last four days, because it is seen to be related to the previous ruling coalition.

On Wednesday, Bursa Malaysia had set MyEG’s lower limit price at RM1.27, following two consecutive days of the stock hitting limit down. MyEG again almost hit limit down on Thursday, with its share price shedding 36.5 sen or a 28.74% drop to 90.5 sen on a volume of 481.45 million shares.

The stock is now trading at a price earnings ratio of 14.5 times from its previous 45 times before GE14.

Wong owns some 30.26% of MyEG via his vehicle Asia Internet Holdings Sdn Bhd, and 7.76% under his name.

Based on Thursday’s closing price of 91 sen, Wong is still a billionaire and worth roughly RM1.24bil.

Meanwhile, the Pakatan Harapan government has delivered one of its key election promises by effectively abolishing the goods and services tax (GST). In a statement issued on Wednesday, the Finance Ministry said goods and services subject to the GST would be zero-rated from June 1.

Wong said that the company has spent close to RM150mil on its GST programme, where it has acquired close to 20,000 dongles, and there are grounds to seek compensation should the programme be cancelled.

“We understand from the media that the GST would now be replaced with the sales and services tax (SST). Our system was originally designed for the SST, so we hope that we can revert to our original system.”

While there are grounds for compensation, Wong said that the company never likes to seek any form of compensation from its clients, in this case the Government, and in the past, has never done so.

“We prefer to discuss to achieve a win-win situation,” he said.

Presently, MyEG’s various projects are grouped under the e-government concession as one of the MSC flagship applications. This concession was awarded in the year 2000 after an open tender.

In order to continue operating under this new environment, Wong said that it is important to understand what the government’s new or additional requirements are, and ensuring that these requirements are met.

While many still see MyEG as a government concession, currently, only 20% of its revenue is derived from the government.

Some 80% of MyEG’s revenue is derived from non-government-related products and services. MyEG has also started its Philippines operations, which it is very excited about.

“The Philippines since it is a huge market, given its population, is practically a landgrab.

“Our initial projects have been well received and we are now scaling up,” he said.

Source: The Star

https://www.thestar.com.my/business/bus ... JrGtsUK.99
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Re: MyEG / Wong Thean Soon

Postby winston » Tue Jun 12, 2018 9:51 am

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Worst is over?

We arranged a meeting with MyEG’s MD and 20 buy side fund managers/analysts.

Management remains optimistic about MyEG’s prospects, especially the Philippines JV and the e-bidding service for new car number plates.

MyEG has submitted a proposal to handle online registration of new foreign workers.

Maintain Add and TP of RM1.22, which offers 42.7% potential upside.

Key risks to our Add call
There are some concerns as well:
i) it would need to provide RM150m if GST monitoring is cancelled;
ii) all of MYEG’s concession services will end in 2020 and there are concerns they may not get renewed;
iii) the government could open up MyEG’s services to new players; however, MyEG has first-mover advantage; and
iv) concerns over foreignfunds selling the stock. MYEG indicated that foreign funds shareholding actually went up after the general election; currently, foreign shareholding is at 30%.


Source: CIMB

https://brokingrfs.cimb.com/lcYIpzclDxY ... _DwEw2.pdf
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Re: MyEG / Wong Thean Soon

Postby winston » Thu Jul 12, 2018 9:12 am

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Meeting in the Lion City

We recently arranged a meeting between MyEG’s managing director T.S. Wong and 16 institutional clients in Singapore.

There were two positive surprises from the meeting:
i) MyEG plans to start operations in Bangladesh by year-end, and
ii) it will commence remittance serv ices next month.

The 5-year concession for all its services ends in May-2020. The renewal of the concession is expected to be a straight forward, the company said.

According to MyEG, it has first-mover advantage for its e-services as we believe it is not easy for new players to replicate MyEG’s services in the short term.

The stock remains an Add; its valuation is attractive at CY19F 10.8x P/E.

Source: CIMB

https://brokingrfs.cimb.com/E5JRX4r-aC5 ... tegRw2.pdf
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Re: MyEG / Wong Thean Soon

Postby winston » Mon Jul 23, 2018 8:44 am

MyEG working on new domestic projects

MyEG’s SST system could be used to track SST on a live basis and reduce leakages, said CIMB Research.

KUALA LUMPUR: MyEG has been working on a Sales and Service Tax (SST) system which the new government could use to reduce leakages when the SST is launched in September and also a new module for foreign workers, says CIMB Equities Research.

In its research note issued on Monday, it said the company was also looking to launch a new remittance service for foreign workers but the timing of the launch has not been announced yet.

“We understand MyEG is also looking to launch e-government services in Bangladesh,” it said.

CIMB Research said the Pakatan Harapan government should decide in the next one to two months whether to use MyEG’s SST system.

When MyEG mooted the GSTM project in 2010, it was initially meant to track SST on a live basis but it was changed to GSTM when the goods and services tax (GST) was introduced in April 2015.

MyEG’s SST system could be used to track SST on a live basis and reduce leakages, said CIMB Research.

As for the foreign workers, it said MyEG recently submitted a proposal to the new government for a new module.

“If successful, we understand the company will become a ‘one stop centre’. Not much is known about this new module but we understand it could be a major revenue generator for the group. We have not assumed any potential earnings from this proposed new module,” it said.

CIMB Research also pointed out MyEG plans to introduce remittance services for foreign workers soon and this could be an exciting revenue contributor for the company in the near future.

While there are no details on the service charge fees yet, the research house understands MyEG could get a flat fee for every remittance transaction.

"De-rating catalysts include failure to win any of these projects and weaker-than-expected earnings,” said CIMB Research.

Source: The Star

https://www.thestar.com.my/business/bus ... 7lp7lRb.99
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