Automotive online classifieds market heats up with MyEG entry: Page 2 of 2

By Goh Thean Eu November 26, 2014

Metrics: Who is leading?

With keen competition not only between the leading players, but also coming from smaller portals nipping at their heels, a lot of claims are being made as to who is No 1, using whichever metric suits them best.

One key criterion, from the buyers’ standpoint at least, is the number of cars available for sale or the number of listings. CarList is certainly focused on pushing home this point in its billboard advertising.

And it’s not unusual for competitors to snipe at each other, claiming their competitors’ listing numbers are inflated or not cleaned up regularly.

When asked about this, both iCar and a former executive of Mudah.my said their databases were cleaned every 90 days. Meanwhile, Tan said that oto.my cleans up its database every 60 days.

Other metrics include audiences, the number of car dealers advertising on the site, the number of leads generated as well as their effectiveness, the last measured as the time to enquiry or to completion of sales from the moment a listing is posted.

What is MyEG’s game plan?

So far, Car X Services has yet to officially launch its online classified services, but industry observers are already speculating on the synergies generated between Car X Services and the MyEG portal.

Will MyEG somehow turn Car X Services into a one-stop centre, or an ‘almost’ one-stop centre, where one can sell a car and get the vehicle ownership transferred at the same time? (Vehicle ownership transfer services are currently available on the MyEG portal).

“I think MyEG might have one advantage in this market considering it may be able to integrate ownership transfers into the site,” admitted Tan, a DNA Digerati50.

“But I’m not sure if that’s a real advantage or not, since we don’t complete transactions online. When we see a car online, we definitely want to have a look at it and test-drive it.

“Transactions aren’t completed online. Dealers will do it for you. Perhaps it is an advantage with direct owner sales,” he added.

MyEG’s Wong (pic) has been keeping his company’s strategy and roadmap close to his chest.

“We cannot let the cat out of the bag so soon … but we must believe we have a secret weapon, otherwise we wouldn’t have ventured into this crowded space,” Wong told DNA via email.

Whatever its strategy, MyEG is expected to give the incumbents a run for their money.
The company, for the full year ended June 30, 2014, registered a net profit of RM50.11 million (US$15 million), representing a 43% increase versus the RM34.85 million (US$10.43 million) it posted the previous financial year.

Revenue increased by 43% to RM109.87 million, compared with the RM76.48 million a year ago [RM1 = US$0.31].

MyEG also managed to increase its cash and bank balance to RM21.95 million, from the RM18.39 million a year ago. It also has RM126.79 million in retained profits, compared with RM87.3 million on June 30, 2013.

Bonus issue

Meanwhile, in a separate announcement, MyEG said it is proposing a bonus issue of up to 601.05 million new ordinary shares at 10 sen each, to be credited as fully paid-up on the basis of one bonus share for every one existing MyEG share held on an entitlement date to be determined later.

It also proposed to increase the authorised share capital of MyEG from RM100 million, comprising one billion MyEG shares, to RM500 million comprising five billion MyEG shares.

In its filing to Bursa Malaysia, the company said that the proposed bonus issue is the most appropriate avenue to reward existing shareholders, and at the same time enhance its capital base.

As for the proposed increase in authorised share capital, the company said that the move is to facilitate the issuance of new MyEG shares as a result of the proposed bonus issue, as well as to cater for “any increases in the share capital of the company pursuant to any other future corporate exercise.”

Some industry observers have speculated that the “any other future corporate exercise” MyEG was referring to could be related to a possible acquisition.

Wong, when contacted by DNA, said that the company is constantly on a lookout for opportunities. However, he believes that should such opportunity arise, the deal will very likely be done via cash and not shares. – Additional reporting by Karamjit Singh

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