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Software, digital and information technology have been the growth
driver for stock markets globally. The world has obviously been on the
digital track for the past many years. Look at the Top 5 most valuable
publicly traded companies over the last decades.
Since 2016, the top 5 names have not changed. In fact, they are now
even bigger, making huge gains in their market capitalisation. As of
market close on 2 September 2020, the Top 5 names were as follow.
| Company | Market Cap | Change since 2016 |
| Apple | USD 2,247 billion | 286% |
| Amazon | USD 1,769 billion | 386% |
| Microsoft | USD 1,753 billion | 288% |
| Alphabet | USD 1,175 billion | 111% |
| USD 862 billion | 140% |
Recently, AirAsia announced that the company is building the next “super app”. A number of Malaysian public listed companies have also made investments into various digital ventures.
Malaysian publicly traded companies with digital ventures
| Company | Market Cap | Digital Ventures |
| AirAsia | RM 2,272 million | BigPay, digital platform, eCommerce |
| Axiata | RM 27,783 million | Boost, ADA, Apigate |
| CIMB | RM 32,547 million | TouchNGo eWallet |
| Digi | RM 31,877 million | altHR, Omni, iFleet, RepublicGG, EasyAdd, JomStudi |
| Green Packet | RM 616 million | Kiple – IOT, Fintech |
| Maybank | RM 81,500 million | GPay Network / GrabPay, MAE, QRPay |
| Warisan TC | RM 67 million | GoCar, MUV |
These companies are operating in industries currently less favoured by
the market. They have invested in these digital ventures in hopes of not
being disrupted and/or in hopes of getting premium valuation from the
market. Can they spin off these ventures as separate entities at a
higher value in the future?
Look at Malaysia public listed companies who are focused in the digital
technology segment. These companies are relatively smaller, in
comparison to global and regional giants.
Selected Malaysian publicly traded companies in the digital and software technology segment
| Company | Market Cap | Businesses |
| Dagang Nexchange | RM 422 million | Dagang Net, trade facilitation, cyber security solutions |
| GHL Systems | RM 1,499 million | Payment solutions |
| Kronologi Asia | RM 348 million | Cloud storage solutions |
| ManagePay Systems | RM 121 million | Payment solutions and gateway, eCommerce, eWallet |
| Omesti | RM 324 million | Enterprise software |
| Revenue Group | RM 509 million | Payment solutions |
The leading digital / technology public company in Southeast Asia, SEA
Limited was valued at USD 79 billion, as of market close on 2 September
2020. Will any Malaysian publicly traded technology company ever achieve
a market cap of more than RM 300 billion?
Digital technology in highly scalable verticals are often a
winner-takes-all market. The global tech giants are already strongly
entrenched in various verticals. Amazon, Apple, Google and Facebook were
questioned by the US Congress back in July 2020 on their alleged
anti-competitive strategies. Malaysian companies attempting to operate
in verticals dominated by these players are very likely to lose.
In the spirit of Merdeka, patriotic Malaysians often wish that there
will come a day that we can proudly say that we have our own Malaysian
global technology unicorn (USD 1 billion), decacorn (USD 10 billion) or
even hectocorn (USD 100 billion) (without having to explain that Grab
was a Malaysian company before moving to Singapore). Will the day come?
Or will Malaysian companies just remain as plain boring corns? (as the
popular Malay proverb “Jaguh Kampung”)
Did we missed out any other companies that have invested into software technology? Let us know by commenting below.
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