MyEG down 24% in morning trade on news it may lose immigration work

MyEG Services Bhd fell 24% in the first half of today’s trade with investors responding to news that the company may stand to lose immigration related jobs.

The stock dropped 22.5 sen to 73 sen after hitting the intra-day low of 65.5 sen.

The New Straits Times reported on Monday that by 2025, all immigration-related affairs, including those now managed by outside parties, such as MyEG, would revert to the Immigration Department.

Besides passport renewals and visa applications, applications and renewals of foreign worker and maid permits would be handled by the department when it rolled out its National Integrated Immigration System, the report quoted the Immigration director-general Datuk Khairul Dzaimee Daud.

Not long after the morning trading began, the stock dropped more than 15% of its reference price, triggering the suspension of the short selling of the stock for the rest of the day under proprietary day trading (PDT) and intraday short selling (IDSS).

“The short selling under PDT and IDSS will only be activated the following trading day, on Wednesday, at 8:30 am,” according to Bursa Malaysia in a filing.

Despite the news, UOB Kay Hian PTe Ltd has maintained a ‘buy’ call on the stock. In a research note released before trade started this morning, it said that it foresees a good buying opportunity on dips following the statement by the present immigration DG.

“We believe that MYEG would still have an important role in immigration-related services,” it said.
Nevertheless, it said its assessment is that that the absolute earnings impact to MYEG is only about 5% of top line revenue should the DG’s statement materialise, as MYEG should still be able to offer its existing ancillary services that the immigration department does not provide, such as insurance coverage and foreign worker matching. – TMR / pic TMR File