MyEG rises 4.5% on wider scope of worker permit renewal system

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KUALA LUMPUR (Jan 12): My E.G. Services Bhd (MyEG) rose as much as 4.5% after the Immigration Department of Malaysia expanded the scope of implementation for MyEG’s foreign workers permit renewal (FWPR) system.

The FWPR system will now ensure the validity of foreign workers’ insurance and deportation costs of illegal foreign workers detained, MyEG told Bursa Malaysia last week.

At 10.40 am today, MyEG rose 1 sen or 0.4% to RM2.68 with some 3.3 million shares done. It had earlier hit a high of RM2.79.

While positive on the development, CIMB Investment Bank Research’s analyst Nigel Foo maintained his FY15 to FY17 earnings per share forecasts as deportation costs for the illegals had already been imputed.

“We retain our add call on MyEG ,” he wrote in a note today with an unchanged target price of RM3.90.

Foo commended the authorities’ close efforts with MyEG to track foreign workers as security has become a major concern, given the huge number of foreign workers.

He believes the authorities will not be pressured by opposition towards the compulsory usage of the FWPR system, given its importance in maintaining and updating the foreign workers database.

From a technical perspective, Kenanga Research said MyEG would see immediate support and resistance levels at RM2.58 and RM2.87 respectively.