Results Above Expectations

RAMSSOL registered 2Q24 core net profit of MYR4.4m (+108% YoY, +4% QoQ). Cumulative 6MFY24 core net profit of MYR8.5m (+104% YoY) was above expectations, at 53%/56% of both ours/street’s FY24E forecasts. Underpinned by robust domestic momentum in its HCM-centric PeopleTech segment, this was RAMSSOL’s second consecutive quarterly earnings outperformance. Year-to-date, RAMSSOL’s 1H24 core net profit has already exceeded FY23’s full-year core earnings by c.32%.

Robust HCM Solutions Growth in Malaysia

2Q24 group turnover grew 71% YoY/20% QoQ, on the back of strong HCM segmental delivery. Growth in Malaysia (+103% YoY) was driven primarily by new product offerings, collaboration with partners for license distribution, and recurring software subscriptions. Limited milestone execution for foreign clients in Singapore (-66% YoY), coupled with robust domestic growth from its high-profit margin HCM license distributorship business also helped boost the group’s EBITDA margins (+11.6% YoY).

GeekStart Acquisition Nearing Completion

RAMSSOL’s AutoTech and MarketingTech segments are expected to buttress PeopleTech contributions in 2H24 as the group has positioned itself to roll out a slew of novel initiatives in the coming months. Meanwhile, we also gather that its acquisition of 51.0% equity interest in TH-based software development company, GeekStart Company Ltd for MYR6.93m is nearing completion by the end of July 2024. To recap, the acquisition comes with a profit guarantee of MYR4.7m/7.1m for FY24E/25E respectively and is expected to contribute positively to group earnings moving forward.

Source: Maybank Research - 25 Jul 2024