MY EG Lodging, a sub-subsidiary of MyEG Services Bhd, has been granted a letter of acceptance by the Penang Development Corporation (PDC) for the tender to establish a workers’ village and its associated amenities at the Batu Kawan Industrial Park 3 (BKIP 3) in Pulau Pinang.
Under the terms of the project, MY EG Lodging will be granted a lease for an expansive 8.39-acre plot of land with a value of RM20.4m, for a period of 30 years. As per the agreement, MY EG Lodging will be responsible for the construction, completion, management, and operation of the workers village and related facilities, entirely at its own cost.
Despite the impending deadline for the finalisation of the National Integrated Immigration System (NIISe) this April, research house MIDF views the successful completion of this project as expected to yield favourable outcomes for the Group’s immigration segment, which constitutes a significant portion of its total revenue, amounting to 35%. This can be attributed to the workers village component of the project, which is poised to provide accommodation for a sizable workforce of 7,500 foreign workers, in strict compliance with the guidelines stipulated by Jabatan Tenaga Kerja Semenanjung Malaysia. Furthermore, the project is anticipated to be certified with GreenRE certification, serving as a testament to its environmentally-conscious design and construction practices.
At this moment, MIDF maintains a BUY call on the stock with an unchanged TP of RM1.00. The house is maintaining its earnings projections for FY23/24F pending further information from management.
