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SJC (9431) SENI JAYA CORP BHD - Riding on Automotive Trend: A Hidden Champion In the Making

In 2018, Grab had officially taken over Uber’s Malaysia operation and had since become the single largest e-hailing monopoly in the industry. Despite the legislation in the industry in 2019, the e-hailing industry is still growing strong for now.

However, since Grab has not listed yet, it is extremely hard to invest in the high-growth industry. But are they any proxies in Malaysia?

Apparently, there is.

Seni Jaya Corp Berhad (KLSE:SJC) had been involved in the outdoor advertising business for a very long time, and the company had suffered losses over the past 2 financial years. That being said, the share price had proved otherwise in the recent trading days. Just look at the share price movement of the company.

Dated 16th June 2021, SJC had picked up programmatic digital out-of-home (“pDOOH”) advertisement strategy as one of their key turnaround plans. The company had also developed a media system – ENOMAD to cooperate with e-hailers in order to place timely and high precision advertisement for their clients.

A very good example given by the management is a case study of a restaurant owner in Gombak. Should the business owner want to promote his business between 11am to 2pm for lunch purposes, the advertisement can be then programmed onto the car-top digital screen of the e-hailing vehicle to optimize the reach of specific audience, given a specific time frame.

Theoretically, ENOMAD can run 24/7, 365 days a year should the lock down is over.

Here are some of the examples of the alpha test of ENOMAD.

As the pandemic weights lesser onto the economy and roads get busier, it is without a doubt that SJC could benefit from the advertisement placements. With over 100,000 ride hailing drivers in Malaysia scattered around the country, each of every of them will soon become income-producing asset for SJC.

The management had also cited that major cities such as New York and London had very successful run in the past. This had given some confidence in investors and hence proved via the hike of share price. The company will be rolling out first 200 cars in Klang Valley area by August 2021, and aims to move onto key cities like Johor Bahru and George Town soon.

With that in mind, it is without a doubt SJC can be a company bigger than 100 million in market cap anytime soon, but don’t expect the financial impact will come anytime soon.

Anyhow, the turnaround is very interesting and for a small-cap company, this is definitely a rare find as a proxy to the economy recovery and e-hailing trend!

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