KUALA LUMPUR (May 21): MY EG Services Bhd (MYEG) topped Bursa Malaysia’s active list and was most actively traded this morning, following three successive limit down last week, which saw more than RM5.84 billion wiped out from its market capitalisation.

When contacted, Maybank Investment Bank Bhd chartist Nik Ihsan Raja Abdullah said MYEG’s share price has been very volatile as investors digest on the outcome of the historic 14th general election (GE14) and re-asses their position.

“The stock is not just oversold, but it is extremely oversold. Investors are bargain hunting for opportunities, and making assessment on what position to take in the stock,” Nik Ihsan told theedgemarkets.com over the telephone today.

Since the opening bell today, MYEG has seen 53.73 million shares exchanging hands, equivalent to 1.49% of its share capital. This morning, the stock rose by as much as 4.86% or 4.5 sen to 97 sen, from a previous close of 92.5 sen. At 10:17am, MYEG shares have pared down its gain and was trading at 96 sen, for a market capitalisation of RM3.46 billion.

Last week, UOB Kay Hian Securities (M) Sdn Bhd said value has started to emerge in MYEG, after the latter’s share price plunged around 65% to its third successive limit down, following the shock outcome of the 14th general election (GE14).

On Friday (May 18), UOB Kay Hian was among the minority brokerage firms that had upgraded MYEG shares to “Buy”, but lowered its target price to RM1.06, from RM1.97 previously.

“This comes on the back of heightened fears of political risks, following Pakatan Harapan’s general election win last week. The risk of its GST monitoring system being scrapped has been fully discounted, and more importantly, we foresee the concession of its efficient e-government portal being continued,” UOB Kay Hian analyst Vincent Khoo said in a May 18 note to clients last week.

UOB Kay Hian’s note was following the remark of MYEG group managing director Wong Thean Soon, who had reportedly told analysts in a close-door meeting and defended the stock as having a first-mover advantage, which is a huge plus point that will enable it to compete efficiently and effectively in the electronic government services sector.

Meanwhile, following GE14, CIMB Investment Bank Bhd said MYEG is at risk of losing future earnings from its GST monitoring project, in which the tax is expected to be scrapped by the newly-formed government over the next 100 days.

As a result, CIMB had on May 14 downgraded MyEG to “reduce” from “hold”, and lowered its target price to RM1.86, from RM3.04 previously.

A few days later, Credit Suisse Securities Malaysia Sdn Bhd joined CIMB and downgraded MYEG shares to “underperform” from “neutral”, and slashed the 12-month target price to 90 sen, from RM2.70 previously.