Henry Soediarko

CrossASEAN Research

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/my-eg-services-bhd" target="_blank" data-smartkarma-citation="entities:19765:1" rel="noopener">My E.G. Services (MYEG MK)</a> 's share price is pummelled down from the reopening sentiment, although investors missed the point on this given the range of services MyEG offers. </li>
<li>Plenty of the upsides from the new JV in the Philippines and Indonesia are yet to contribute to the full extent due to COVID-19.</li>
<li>Trades at 19x PER, a deep discount to its historical highs despite stable profitability and a healthy ROE at 23%.  </li>
</ul>

<p>Since the beginning of 2018, the company has expanded its business from a Malaysian e-government service provider to a regional e-government service provider (for Indonesian and the Phillippines), proving that the management's past achievement in Malaysia was not achieved by trading favor rather with a superior product offering. </p>
<p>The concession license is up for renewal sometime soon but so far there is no other competitor like My EG thus maybe the license renewal is not really an issue after all. The company is also backed by a solid mixture of domestic and foreign growth-oriented, low-turnover investors. In addition to that, the key personnel including Chief Technology Officer is a top shareholder.</p>
<p>Trading at 19x historical PER makes <a href="https://www.smartkarma.com/entities/my-eg-services-bhd" target="_blank" data-smartkarma-citation="entities:19765:1" rel="noopener">My E.G. Services (MYEG MK)</a> is valued at a <strong>53%</strong> discount to its 3-year-average PER and a <strong>60%</strong> discount to the 2019 average PER. Compared to its peers, <strong>My EG is trading at a 40% discount in PER while generating 450% higher ROIC. </strong></p>
<p>The regional expansion to Indonesia and the Philippines is just starting with vast potential<strong>. <a href="https://www.smartkarma.com/entities/my-eg-services-bhd" target="_blank" data-smartkarma-citation="entities:19765:1" rel="noopener">My E.G. Services (MYEG MK)</a> is a counter-cyclical stock of choice for a long term growth investor.</strong></p>

<p><a href="https://www.smartkarma.com/entities/my-eg-services-bhd" target="_blank" data-smartkarma-citation="entities:19765:1" rel="noopener">My E.G. Services (MYEG MK)</a> , unlike other companies, has the luxury to pivot its business model depending on what the Malaysian government requires. It was providing a permit e-renewal and now it has evolved to providing COVID-19 related service offerings. </p><p>The public's concern on MyEG has always been whether it has ties to a specific government's regime. It does not have a tie to a particular government regime due to its unique business model that the company offers free help for the governments and only asks for traffic and the company will make an effort to upsell certain products through the provided traffic.</p><div class="content-highlight"><p>It has survived two governments so far, and I would think they would survive the upcoming government too due to the unique business model. </p></div>

Angus Mackintosh

Cross Asset Strategy

<ul>
<li>The Week That Was in ASEAN@Smartkarma is filled with an eclectic mix of differentiated, substantive, and actionable insights, macro and equity bottom-up, from across South East Asia.</li>
<li>The past week saw insights in <a href="https://www.smartkarma.com/entities/grab-holdings-inc" target="_blank" data-smartkarma-citation="entities:26950:1" rel="noopener">Grab (GRAB US)</a>, <a href="https://www.smartkarma.com/entities/kino-indonesia" target="_blank" data-smartkarma-citation="entities:1083:1" rel="noopener">Kino Indonesia (KINO IJ)</a>, and <a href="https://www.smartkarma.com/entities/xl-axiata-tbk-pt" target="_blank" data-smartkarma-citation="entities:15028:1" rel="noopener">XL Axiata (EXCL IJ)</a>, as well as deal-related commentary on <a href="https://www.smartkarma.com/entities/thai-beverage-pcl" target="_blank" data-smartkarma-citation="entities:3656:1" rel="noopener">Thai Beverage</a> and <a href="https://www.smartkarma.com/entities/true-corp-pcl" target="_blank" data-smartkarma-citation="entities:8:1" rel="noopener">True Corp</a>.</li>
<li>There were also some Index inclusion insights for Indonesia and the Philippines, as well as insights on <a href="https://www.smartkarma.com/entities/comfortdelgro-corp-ltd" target="_blank" data-smartkarma-citation="entities:497:1" rel="noopener">Comfortdelgro Corp (CD SP)</a> and <a href="https://www.smartkarma.com/entities/my-eg-services-bhd" target="_blank" data-smartkarma-citation="entities:19765:1" rel="noopener">My E.G. Services (MYEG MK)</a> in Malaysia.</li>
</ul>

<div class="content-highlight">
<p>The week that was in <a href="mailto:ASEAN@Smartkarma" target="_blank" rel="noopener">ASEAN@Smartkarma</a> is filled with another eclectic mix of differentiated, substantive, and actionable insights from across South East Asia and includes macro, top-down and thematic pieces, as well as actionable equity bottom-up and credit insights over the past week.</p>
<p>We add below a NEW section, which includes emerging themes in ASEAN and selects important news flow or developments for commentary, which may impact SE Asian companies and markets.  </p>
</div><h3>Equity Bottom Up</h3><p>In<a href="https://www.smartkarma.com/insights/sea-ltd-se-us-financial-services-the-third-pillar" target="_blank" rel="noopener"> Sea Ltd (SE US) - Financial Services the Third Pillar?</a>, CrossASEAN insight provider<a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener"> Angus Mackintosh</a> revisits the company after the Monetary Authority of Singapore (MAS) announced last week that it will award a full digital bank license to <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" rel="noopener">Sea Ltd (SE US).</a></p><p> In <a href="https://www.smartkarma.com/insights/erajaya-swasembada-eraa-ij-feeding-the-digital-economy" target="_blank" data-smartkarma-citation="insights:46136" rel="noopener">Erajaya Swasembada (ERAA IJ) - Feeding the Digital Economy,</a> CrossASEAN Insight Provider <a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" data-smartkarma-citation="accounts:937" rel="noopener">Angus Mackintosh</a> revisits Indonesia's leading smartphone and retailer and distributor after a call with the company's management. </p><p>In this Malaysian Insight,<a href="https://www.smartkarma.com/insights/myeg-vaccine-and-concession-worries-unfounded" target="_blank" rel="noopener"> MYEG: Vaccine and Concession - Worries Unfounded</a>, CrossASEAN insight provider<a href="https://www.smartkarma.com/profiles/henry-soediarko" target="_blank" rel="noopener"> Henry Soediarko</a> sees the company as undervalued versus its peers, with management taking a more dynamic and active approach by launching new initiatives such as online groceries and health screening services.</p><p>In<a href="https://www.smartkarma.com/insights/far-east-hospitality-trust-feht-stable-in-slow-recovery" target="_blank" rel="noopener"> Far East Hospitality Trust (FEHT): Stable in Slow Recovery</a>,<a href="https://www.smartkarma.com/profiles/henry-soediarko" target="_blank" rel="noopener"> Henry Soediarko</a> returns to look at <a href="https://www.smartkarma.com/entities/far-east-hospitality-trust" target="_blank" data-smartkarma-citation="entities:19061:1" rel="noopener">Far East Hospitality Trust (FEHT SP)</a>, which he sees as a relatively safe way to play the recovery in the hospitality industry.</p><p>In<a href="https://www.smartkarma.com/insights/sea-ltd-placement-new-business-needs-new-money" target="_blank" rel="noopener"> SEA Ltd Placement - New Business Needs New Money</a>,<a href="https://www.smartkarma.com/profiles/sumeet-singh" target="_blank" rel="noopener"> Sumeet Singh</a> revisits<a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" rel="noopener"> Sea Ltd (SE US)</a> as it announced that it is planning to raise US$2.2bn - US$2.6bn in a primary follow-on offering of Global Depository Shares. He sees this as an opportunistic fundraising to help grow its digital financial services having just secured a full digital banking license in Singapore. </p><p>In <a href="https://www.smartkarma.com/insights/ptt-oil-and-retail-pttor-ipo-initiation-octane-ratings" target="_blank" data-smartkarma-citation="insights:46230" rel="noopener">PTT Oil and Retail (PTTOR) IPO Initiation: Octane Ratings,</a><a href="https://www.smartkarma.com/profiles/arun-george" target="_blank" data-smartkarma-citation="accounts:1680" rel="noopener">Arun George</a> initiates coverage on this upcoming gasoline station and retailing IPO from PTT Group.</p><p>In<a href="https://www.smartkarma.com/insights/ipo-radar-supalai-reit-office-tower-operator-on-rama-3" target="_blank" rel="noopener"> IPO Radar: Supalai REIT, Office Tower Operator on Rama 3</a>, our Thai guru<a href="https://www.smartkarma.com/profiles/athaporn-arayasantiparb-cfa" target="_blank" rel="noopener"> Athaporn Arayasantiparb, CFA</a> looks at the upcoming IPO of <a href="https://www.smartkarma.com/entities/supalai-real-estate-investment-trust" target="_blank" data-smartkarma-citation="entities:30843:1" rel="noopener">Supalai Real Estate Investment Trust (SPALIRT TB)</a>in Thailand.</p><p><a href="https://www.smartkarma.com/entities/supalai-public-company-ltd" target="_blank" data-smartkarma-citation="entities:14148:1" rel="noopener"></a>In Thailand<a href="https://www.smartkarma.com/insights/kerry-express-thailand-ipo-time-for-delivery" target="_blank" rel="noopener"> Kerry Express Thailand IPO - Time for Delivery</a>, IPO specialist<a href="https://www.smartkarma.com/profiles/sumeet-singh" target="_blank" rel="noopener"> Sumeet Singh</a> takes a look at<a href="https://www.smartkarma.com/entities/kerry-express-thailand" target="_blank" rel="noopener"> Kerry Express Thailand (KEX TB)</a> which has registered spectacular growth over the past few years. </p><p>Still in<a href="https://www.smartkarma.com/insights/kerry-express-thailand-kex-ipo-update-on-valuation-range-competitor-actions" target="_blank" rel="noopener"> Kerry Express Thailand (KEX) IPO: Update on Valuation Range &amp; Competitor Actions</a><a href="https://www.smartkarma.com/profiles/daniel-hellberg" target="_blank" data-smartkarma-citation="accounts:605" rel="noopener">Daniel Hellberg</a> of <a href="https://www.smartkarma.com/companies/tracking-traffic" target="_blank" rel="noopener">Tracking Traffic</a> takes a look at the upcoming IPO of <a href="https://www.smartkarma.com/entities/kerry-express-thailand" target="_blank" rel="noopener"> Kerry Express Thailand (KEX TB).</a><a href="https://www.smartkarma.com/entities/kerry-express-thailand" target="_blank" data-smartkarma-citation="entities:29253:1" rel="noopener">Kerry Express Thailand (KEX TB)</a> recently announced an IPO price range of THB25-28 per share and plans to finally list its shares in late December. </p><div id="ember14458">
<p>In<a href="https://www.smartkarma.com/insights/singapore-exchange-strains-seen-for-tw-futures" target="_blank" rel="noopener"> Singapore Exchange – Strains Seen For TW Futures</a>,<a href="https://www.smartkarma.com/profiles/thomas-j-monaco" target="_blank" rel="noopener"> Thomas J. Monaco</a> takes a look at  <a href="https://www.smartkarma.com/entities/singapore-exchange-ltd" target="_blank" rel="noopener">SGX (SGX SP),</a> after it released market statistics for November 2020. </p>
<div><div id="ember14917"><section></section></div></div>
</div><h3>Sector and Thematic</h3><p>In <a href="https://www.smartkarma.com/insights/the-stocks-to-own-in-asean-vol-33" target="_blank" data-smartkarma-citation="insights:46106" rel="noopener">The Stocks to Own in ASEAN – Vol. 33,</a><a href="https://www.smartkarma.com/profiles/dr-andrew-stotz-cfa" target="_blank" data-smartkarma-citation="accounts:756" rel="noopener">Dr. Andrew Stotz, CFA</a> lays out his thoughts and highlights 14 stocks in ASEAN that look interesting to him based on his FVMR Methodology. His research team constantly reviews the ASEAN markets to try to find interesting ideas based on Fundamentals or Valuation or Momentum or Risk or some combination thereof. </p><div><p></p></div>

Malaysia

My E.G. Services Bhd provides E-Services between the Malaysian Government and its citizens and businesses.  The Company's services include electronic delivery of driver and vehicle registrations, licensing and summons services and utility bill payments.

My E.G. Services - MYEG MK

Description