This article first appeared in The Edge Malaysia Weekly on March 2, 2026 - March 8, 2026
NexG Bhd (KL:NEXG) reported that its latest quarterly earnings were severely impacted by a RM145.6 million fair value loss on its “other investments”. As a result, the company recorded a net loss of RM130.88 million in its third financial quarter ended Dec 31, 2025 (3QFY2025).
One might argue that this should not be cause for concern, given that these are non-operational losses. Furthermore, NexG has two major wins under its belt: a RM1.73 billion contract to supply Malaysian passports and another worth RM732.72 million to supply next-generation national identity cards.
Still, the magnitude of the fair value loss warrants shareholders’ attention. The impairment reflects the sharp decline in NexG’s investments. In other words, the money invested may be lost if the values do not recover.
In its quarterly result announcement, NexG did not provide details of the investments. Based on its bourse filings, the company acquired a 9.48% equity stake in MMAG Holdings Bhd (KL:MMAG) and a 32.61% stake in NexG Bina Bhd (KL:NEXGBINA), along with warrants. NexG Bina was formerly known as Caely Holdings Bhd before changing its name to Classita Holdings Bhd.
NexG purchased MMAG shares at 40 sen per share, but the stock closed at 3.5 sen last Friday. Meanwhile, it acquired the stake in NexG Bina at 15 sen per share, and the counter closed at 2.5 sen last Friday. The company paid 3.5 sen and 4 sen for NexG Bina warrants, which ended the week at 1 sen.
Additionally, NexG acquired a 51% equity interest in Innov8tif Holdings Sdn Bhd from Revenue Group Bhd (KL:REVENUE) for RM40 million cash in November 2024. A back-of-the-envelope calculation indicates that NexG has spent more than RM180 million on investments.
All things considered, do NexG’s board and management owe shareholders an explanation regarding the investment loss?
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