MyNews Holdings Berhad

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$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
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Good morning ☀️,

*1QFY10/25 Results Note 🗒️– Mynews Holdings*

Company: *Mynews Holdings Berhad (MNHB MK)* 🏪

Target Price: *RM0.80* _maintained (21x CY26F P/E)_ 📈

Rating: *Buy* _maintained_ 📈

*Key Highlights* 🏢:

📊*1QFY10/25 results: *In-line* ✅

📌 Revenue: +10.4% YoY, boosted by more stores & higher in-store sales 📈

📌 EBITDA Margins: +0.7pp to 14.1%, thanks to better leverage & profitable sales mix 🏪

📌 Core Net Profit: +155% YoY to RM4.5m, in line with expectations ✅

📌 QoQ: Revenue +3.6%, but core net profit flat (+0.8%) due to a seasonally higher tax rate 💰

📌 🏬 Current Store Network: 632 stores (+12), including 486 Mynews & 146 CU Mart stores 🏪

📈 *FY25F Outlook:*

📌 Forecasted Revenue: +7.5% YoY 📅 & Core Net Profit: +84.9% YoY to RM23.2m 📊

📌 Growth driven by margin expansion, cost management, turnaround in CU, better utilisation rate of food processing centre & more stores 🚀

📌 Expansion Plan: 50 new stores in FY25F (+8.1% YoY) 🏬

💡 *Investment Call:*

📌 *Maintain Buy* with TP of RM0.80 🔥. This is pegged to 21x CY26 P/E, this represents a 20% discount to 7-Eleven’s 5-year mean P/E of 26x.

📌 At 15.3x CY26F P/E, Mynews’s valuations are attractive due to:
1) Strong earnings growth (3-year net profit CAGR of 48.3% from FY24–27F after returning to profit in FY24) 📈
2) Established brand in Malaysia’s convenience store market 🏪
3) More inelastic demand for convenience stores like Mynews, due to their essential nature 🛒

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
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$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by RHB

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
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$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research Report by MAYBANK

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
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$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
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KUALA LUMPUR: Retail and convenience store operator MyNews Holdings Bhd has launched Maru Café at the Intercontinental Hotel Kuala Lumpur, marking a new growth opportunity for the company, according to RHB Investment Bank Bhd (RHB Research).

© New Straits Times Press (M) Bhd

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by RHB

PETALING JAYA: Retail and convenience stores operator MyNews Holdings Bhd is well positioned for earnings growth in the near future, say analysts.

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
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$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
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$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by RHB

KUALA LUMPUR: RHB Research expects convenience retail operator MyNews Holdings Bhd to see a more substantial earnings improvement across all business units in fourth quarter of financial year 2024 4QFY2024), after 3QFY2024 saw its fourth consecutive quarter of profits.

© New Straits Times Press (M) Bhd

Is it time? $MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD) show me some love...

CONSUMER
$KLSE-F&N $MRDIY / 5296 (MR D.I.Y. GROUP) $MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by CGS
Overweight

“The subsidy removal drag could be a boost ”

We maintain our Overweight stance on the Malaysian consumer discretionary sector and Neutral stance on the consumer staple sector. We think market fears of the recent diesel subsidy removal and upcoming RON95 petrol subsidy removal in 2H24F weighing on consumer demand, resulting in a 4% decline in the KLCI Consumer Index from its 20 May peak, may be overdone. Instead, we believe the cash handouts to lower income households, in particular, could far outweigh the cost inflation (fuel and others), and leave these households with additional disposable income each month.

Analyst(s):
Prem JEARAJASINGAM
prem.jearajasingam@cgsi.com
LEW Cheng Wei
chengwei.lew@cgsi.com

Change in Boardroom - DR BLAKE DANG KUOK SIANG

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by CGS
Add – TP of MYR 1.18

“Faster earnings recovery in 2H24F onwards”

We raise our core net profit estimates for FY24F/25F/26F by 49.5%/78.5%/20.9% post 2QFY10/24 analyst briefing held on 24 Jun 24 as we factor in a faster earnings recovery, driven by higher revenue growth and recovery in gross margins. We believe new store openings in FY24F and continued growth in private consumption will support revenue growth and improve utilisation rates at its food processing centre (FPC) – the key drag on Mynews’ earnings since its launch in 2019. This will drive Mynews back to profitability in FY24F and drive FY25F core net profit (RM33m) above pre-Covid-19 high (RM27.6m)

Analyst(s):
LEW Cheng Wei
chengwei.lew@cgsi.com
Prem JEARAJASINGAM
prem.jearajasingam@cgsi.com

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by RHB
Buy – TP of MYR 0.81

“Entering a Sustainable Earnings Upcycle; Still BUY”

Still BUY and MYR0.81 TP, 21% upside and c.2% FY25F (Oct) yield. We attended Mynews’ post-results briefing and came away feeling upbeat about its prospects. We think the worst is over with the turnaround of CU by endFY24F and Mynews’ progressive contribution of driving the recovery of the profit base to pre-pandemic levels. The current valuation of 16.7x FY25F P/E is attractive compared to its convenience store (CVS) peers, and we think the market has yet to price in the company’s recovery prospects.

Analyst(s):
Tai Yu Jie
tai.yu.jie@rhbgroup.com
Soong Wei Siang
soong.wei.siang@rhbgroup.com

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by CGS
Add – TP of MYR 0.89

“Strong 2Q24 earnings; more growth ahead”

Mynews Holdings reported 2QFY10/24 core net profit of RM1.7m (+36.8% qoq), vs. 2QFY23 core net loss of RM6.3m. This brought 1HFY24 core net profit to RM3m, which we deem to be in line at 27%/32% of our/Bloomberg consensus’ estimates as we expect continued strong earnings momentum in 2HFY24F on higher footfall, with 2QFY24 impacted by the Ramadan fasting period. This was the third consecutive quarter that Mynews has recorded core net profits, driven by revenue growth and improvement in gross margins.

Analyst(s):
LEW Cheng Wei
chengwei.lew@cgsi.com
Prem JEARAJASINGAM
prem.jearajasingam@cgsi.com

KUALA LUMPUR: MyNews Holdings Bhd's CU convenience store chain can be expected to continue its turnaround following the consolidation of the CU and Mynews management teams, which has helped to elevate sales and gross profit margin, says RHB Research.

KUALA LUMPUR: RHB Research has maintained its "Buy" recommendation on MyNews Holdings Bhd, setting a target price of 81 sen, a 26 per cent upside. 

© New Straits Times Press (M) Bhd

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by RHB
Buy – TP RM0.81

“Improving QoQ Despite Soft Seasonality; BUY"

KeepBUYandMYR0.81TP,26%upside.Mynews’1HFY24(Oct)results met expectations, with 2QFY24 core earnings showing improvement QoQ despite softer seasonality during the fasting month. The consolidation of CU and Mynews management teams has consistently improved sales and GPM through stronger bargaining power and an enhanced product assortment. We believe valuation should re-rate with the progressive contributions from Mynews, alongside the turnaround of CU and food processing centre (FPC), driving the recovery of the profit base to pre-pandemic levels.

Analysts:
Tai Yu Jie
tai.yu.jie@rhbgroup.com
Soong Wei Siang
soong.wei.siang@rhbgroup.com

KUALA LUMPUR: MyNews Holdings Bhd reported a RM1.7 million net profit in the second quarter ended April 30, 2024 thanks to improvements in in-store sales and margin.

© New Straits Times Press (M) Bhd

KUALA LUMPUR: MyNews Holdings Bhd expects sales revenue to maintain its upward trajectory, driven by ongoing efforts to open new stores and enhance product mix and services.

Quarterly rpt on consolidated results for the financial period ended 30/04/2024

OTHERSMYNEWS HOLDINGS BERHAD ("MYNEWS" OR "THE COMPANY")
- EXTENSION OF TIME FOR THE UTILISATION OF PROCEEDS RAISED FROM THE PRIVATE PLACEMENT INVOLVING 68,200,000 NEW ORDINARY SHARES IN MYNEWS

KUALA LUMPUR: RHB Investment Bank Bhd (RHB Research) expects MyNews Holdings Bhd’s financial year 2025 (FY25) net profit to reach pre-pandemic levels of RM28 million once CU is no longer a drag on earnings. 

© New Straits Times Press (M) Bhd

$MYNEWS / 5275 (MYNEWS HOLDINGS BERHAD)
Research by RHB
Buy - TP RM0.81

"Bouncing Back From a Low; Keep BUY"

Keep BUY, with new MYR0.81 TP from MYR0.68, 27% upside and c.2% FY25F (Oct) yield. Mynews' current valuation of 15.9x FY25F P/E appears attractive compared to its convenience store (CVS) peers. We forecast FY25 net profit to reach pre-pandemic levels of MYR28m once CU is no longer a drag on earnings. With the worst likely behind, the end of CU's gestation period, progressive contributions from Mynews, and the turnaround of its food processing centre (FPC) should drive a re-rating of the stock.

Analysts:
Tai Yu Jie
tai.yu.jie@rhbgroup.com
Soong Wei Siang
soong.wei.siang@rhbgroup.com