The recent slew of new contract wins further strengthens MyEG’s position in diversifying its revenue base amidst heightened policy risks that could impact its traditional businesses.
According to Maybank Investment Bank Bhd (MIBB) in a recent report, MyEG announced that Penang Development Corp has awarded it the tender to develop a new foreign worker village at Batu Kawan Industrial Park 3 in Penang.
According to the management, the estimated cost to develop the worker accommodation is RM10-12k per bed, therefore a facility of 7,500 pax may cost the group approximately RM75-90 million.
Development of the facility could take at least 18 months, suggesting that revenue contribution could kick in only by financial year 25 E. Given the booming semiconductor development in Batu Kawan, MIBB expects a resilient rental demand for the hostel services.
Since its partnership formation with China’s Customs to offer blockchain based cross-border trade facilitation services, the group has been engaging with all the relevant stakeholders, including shipping companies and freight forwarders, to onboard and utilise the new system.
MIBB understands that the group charges a fee of CNY200 for each certificate issued on the chain, therefore providing MyEG a huge addressable market of 2.5 million in custom processes and trades annually.
Revenue contribution could kick in as early as May 2023. MIBB believes the adoption amongst business entities could rise in tandem with the development of the Regional Comprehensive Economic Partnership, as businesses could stand to benefit from better transparency and efficiency from the new customs process.
