My E.G. Services saw a significant boost in its shares early Tuesday, following robust second-quarter financial results. The digital-services company experienced a 5.1% surge in its share price, reaching 0.83 ringgit and accumulating a 6.7% increase over the past year.
Reporting on Monday, My E.G. Services announced a second-quarter net profit of 111.6 million ringgit ($24 million), a notable improvement from the previous year's figure of MYR88.6 million. The company attributed this growth primarily to higher revenue, as well as contributions from recently introduced services on its Zetrix blockchain platform and the sale of Zetrix tokens. Quarterly revenue also rose by 14% compared to the previous year, totaling MYR184.9 million.
Maybank Investment Bank has raised its target price for My E.G. Services to MYR1.16 from MYR1.14, maintaining its buy rating. Furthermore, the bank has revised its earnings estimates for 2023 and 2024 by 6% and 2% respectively, reflecting a more optimistic earnings outlook.
In an analysis note, Maybank analysts Anand Pathmakanthan and Arvind Jayaratnam emphasized that My E.G.'s Zetrix token sales are expected to improve further in the second half of this year, particularly after their scheduled listing next month on the Singapore-based crypto exchange Coinstore.
Analysts also anticipate that My E.G.'s growth in 2023-2024 will be driven by the collaboration between Zetrix, China's national blockchain platform Xing Huo, and the Philippines' Bureau of Customs, aimed at facilitating cross-border trades among these countries. This collaboration is expected to increase the revenue contribution of My E.G.'s decentralized finance segment to 10% and 17% respectively, up from the previous figures of 8% and 15%.
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