Multiple catalytic boost to Agmo seen in the near term

Agmo posted a 10% rise in net profit to RM7.8 million n FY Mar 2024. However, on a quarterly basis, net earnings fell 43% year-on-year to RM1.5 million in 1QFY25.

Agmo is expected to see incremental income contributions from its e-invoice middleware solution as its clients which will need to comply with the full implementation of e-invoicing mandate by 1 July 2025. An e-Invoice is a digital representation of a transaction document exchanged between a supplier and a buyer.

It replaces conventional paper or electronic documents such as invoices, credit notes and debit notes. The digital document includes all the essential information found in traditional documents, such as supplier and buyer details, item descriptions, quantities, pre-tax prices, taxes and total amounts.

The implementation of e-Invoicing is expected not only to offer a seamless experience for taxpayers but also enhance business efficiency and boost tax compliance. Agmo sees e-Invoicing as a great opportunity to expand the group’s service offerings and market share, which would translate into a stronger financial performance.

The company said as an e-Invoicing middleware, it focuses on building an inclusive ecosystem with different partners to provide a comprehensive e-Invoicing middleware solution to the market.

It is working closely with partners which will help increase its recurring revenue, as its solution is designed as a Software-as-a-Service (SaaS)-based solution.

In the longer term, Agmo can also cross-sell and upsell different artificial intelligence (AI)-based solutions. Agmo has seen strong interest from the market, following the strategic partnership that it has established with its partners, including professional services firm YYC Advisors.

In February, it was announced that Agmo’s 52.5%-owned subsidiary Jom eInvoice Sdn Bhd was launching JomeInvoice. It is a middleware solution that acts as a connector to LHDN’s MyInvois System, helping its clients mitigate the challenges associated with the adoption of e-Invoicing.

Not only that, Agmo is branching out to clean energy business. This is via a partnership with Solarvest Holdings Bhd whereby they will jointly develop digital products catering to the clean energy sector.

The two companies will set up a joint venture (JV) to produce the digital products, including software, digital platform, data analytics and technology integration services.

Solarvest will hold 70% in the JV while Agmo will have the remaining 30%. Products to be developed by the JV company will include a renewable energy (RE) certificate platform, a home solar project management system, and an electric vehicle platform.

Developments are likely to take place over the period of six months to one year. Shareholders interest in the stock will likely continue given its exciting prospects and this will support the share price moving forward.