Revving up its new revenue vertical; maintain BUY

We believe that the launch of Rider Gate effectively creates a new revenue vertical for the group, augmenting its earnings growth potential of its traditional HCM business. Our FY24-26E earnings forecasts, TP of MYR1.00 (17x FY25E PER, at LT mean) and BUY rating are maintained, as we have previously imputed Rider Gate in our forecasts. RAMSSOL is our top SMID pick for MY software, on the back of its HCM growth potential.

Aiming to be the used motorbike market leader

RAMSSOL (via whole-owned subsidiary, RAMS AutoTech) officially launched Rider Gate on 18 Jan 2025 A domestic online marketplace for used motorbikes, Rider Gate differentiates itself from incumbents by offering a slew of auxiliary services including ownership transfer, inspections, insurance, extended warranties and smart financing. RAMSSOL has invested >c.MYR10m into the development of the platform and aims to be the “Carsome equivalent” for the Malaysian used motorbikes market.

Malaysia home to a robust two-wheeler market

AMR posits the global used motorbike market was valued at USD38.7b in 2021 and is expected to grow at a 10Y CAGR of 5.6% to reach USD66.2b by 2031. M’sia has an estimated 16.7m registered motorbikes and was the 13th largest 2-wheeler market in the world in 2023. With c.500-600k bikes sold in Malaysia annually, facilitating transactions for just a small fraction of the pie could equate to tangible future earnings accretion for RAMSSOL.

AutoTech set to be secondary earnings driver

At launch, RAMSSOL disclosed that it had onboarded 150 registered dealers onto the platform and aims to grow its network to 800 dealers spanning 3,000 outlets nationwide by end-2025. During its trial phase in 2024, Rider Gate successfully executed 1,450 transactions. Our model has imputed for 2,500 transactions in FY25E-26E at a charge of MYR85 per transaction (mgmt guidance: MYR100-130) yielding forecasted revenue/CNP accretion of MYR6.4m/MYR1.3m p.a. for FY25E and FY26E respectively. With c.20% net profit margins from Rider Gate, the platform could potentially drive secondary earnings growth for RAMSSOL in the years ahead.

Source: Maybank Research - 31 Jan 2025