We attended the launch of Edgenta NXT, which ventures are the next step in the “Edgenta of the Future (2025)” journey; Edgenta aims to become a technology enabled solutions company with a focus on healthcare. Forecasts remain unchanged. We retain our TP of RM2.40 based on SOP valuation methodology. Maintain BUY.

We attended the launch of Edgenta NXT, where Edgenta outlined a number of digital initiatives by the group, which included QuickMed, Edgenta NXT Cloud, Edgenta NXT Marketplace, Edgenta NXT Procure.

QuickMed. QuickMed is a B2B2C platform launched by Edgenta to help healthcare providers digitise their operations and connect to the internet. QuickMed’s digital solutions include storage of data on cloud, automation of billing, and more. In the future, we expect QuickMed’s offerings to include telehealth services, online referrals of medical professionals, delivery of medicines and more.

QuickMed’s key advantage over its peers. Note that Edgenta already provides healthcare support services to many government hospitals. As well as being owned by Khazanah, we reckon it is only a matter of time before government hospitals either adopt the QuickMed platform and/or begin using the platform for patients to book appointments, which would then result in patients being on boarded onto the platform. From this, we believe QuickMed will build a sizeable user base which would make it an attractive proposition for large clinic and hospital chains.

Edgenta NXT Cloud, Edgenta NXT Marketplace, Edgenta NXT Procure . Edgenta cloud is a cloud platform which will be used to store data from QuickMed and Edgenta’s existing infrastructure, facilities and healthcare support services operations. Edgenta NXT Marketplace is a platform that houses various solutions from Edgenta’s partners so that they can collaborate with Edgenta and/or with each other. For example, a start-up that has developed medical imaging AI can make this solution available on Edgenta NXT Marketplace to be purchased by healthcare providers who wish to use the software. Alternatively, Edgenta may decide to pay the start-up for the rights sell it a bundle along with QuickMed. Edgenta NXT Procure is a platform designed to allow users to find, secure quotes and procure quickly and efficiently. This will not only allow suppliers who list on the platform to boost transaction volumes but also buyers such as SMEs who may not have the scale to procure supplies at competitive rates.

Outlook. These ventures are the next step in the “Edgenta of the Future (2025)” journey as Edgenta aims to become a technology enabled solutions company with a focus on healthcare. We believe the cloud, marketplace and procure platforms are Edgenta’s attempt at building a digital ecosystem that offers businesses a one-stop solution whilst simultaneously adding value to their own operations by leveraging the solutions in Edgenta NXT marketplace.

Forecasts. As these ventures are still in their nascent stage, we keep our forecasts unchanged for the time being.

Maintain BUY. TP: RM2.40. We maintain our TP of RM2.40 based on SOP valuation methodology (Figure #5). Maintain BUY.

Source: Hong Leong Investment Bank Research - 29 Jul 2021