KUALA LUMPUR (Sept 14): Maybank Investment Bank Research (Maybank IB) has maintained its “buy” rating of MyEG Services Bhd at 80 sen, with an unchanged target price of RM1.16, and opined that MyEG does not appear to have contravened government standard operating procedures (SOPs) in the course of its business dealings, and advised investors to accumulate its shares on weakness.
On Wednesday, MyEG denied illegally collecting fees for its foreign worker permit renewal services.
In a bourse filing, the e-services provider clarified that there was and had been no misrepresentation by MyEG in the services available on its online platform, and that all services continue to be provided in accordance to the terms and conditions stipulated by the government of Malaysia.
“Furthermore, the board wishes to clarify that the statement made by the honourable Khoo Poay Tiong (Kota Melaka-Pakatan Harapan) was an opinion of his own,” it said.
As at the time of writing, neither the govenment nor MyEG had announced the extension of the company's contract for processing foreign worker permits.
MyEG said in July that it had received a notification letter from the Ministry of Finance, which agreed to an extension.
At the time, MyEG said the terms of the extension “will be finalised pursuant to further discussion with the government in due course”.
An agreement to formalise the extension “will be signed at a later stage”, it said then, but there has been no update since.
MyEG did not say whether those who paid it had been facing delays in getting the work permits issued by the Immigration Department.
In the latest filing with the stock exchange on Wednesday, MyEG didnt reveal the latest update on the extension of the contract.
In a note on Wednesday, Maybank IB said that while it is true that MyEG continued to collect fees for permit renewals after the expiry of its contract on May 22, the company maintained that it had adhered to all government-mandated SOPs in that time.
“This included full refunds to employers who sought to renew their worker permits directly with the Immigration Department, and were able to provide proof of payment of having done so,” it said.
Maybank IB said MyEG’s management disclosed that the total quantum of refunds processed had been negligible to date, primarily due to the low number of formal refund requests received thus far.
“We believe this may be primarily due to additional costs associated with permit renewals done directly with the Immigration Department.
“While the Member of Parliament’s allegations cast a shadow on the public perception of MyEG, we do not believe, based on the available facts, that it has contravened government-mandated SOPs since the initial concession expiry in late-May.
“The management is confident of receiving finalisation of the official concession extension in the coming weeks, which should then put this matter to rest,” Maybank IB said.