Broker: Maybank Investment Bank Berhad
Date of Report: July 4, 2025

Zetrix AI: Unveiling Malaysia’s National Blockchain Growth Story and Investment Opportunity

Overview: Zetrix AI’s Ascendance as Malaysia’s Blockchain Backbone

Zetrix AI stands at the forefront of Malaysia’s digital transformation, emerging as a pivotal technology solution provider and the nation’s designated blockchain developer. With the recent launch of the Malaysia Blockchain Infrastructure (MBI), Zetrix AI—alongside its key partner MIMOS—has taken a central role in building the “national backbone” for verifiable credentials (VC), supply-chain traceability, and asset tokenization. The company’s proprietary Layer-1 blockchain is already powering critical applications such as MyDigital ID and MyGov, setting the stage for robust revenue growth and long-term market relevance.

Strategic Shift: From G2G Provider to National Blockchain Developer

Zetrix AI’s business evolution—from an exclusive government-to-government (G2G) IT service provider to a national blockchain infrastructure developer—has recalibrated its valuation outlook. While the company’s FY25-27 earnings forecasts remain unchanged, the target price is now MYR1.45 per share (down from MYR2.00), reflecting a more realistic 15x FY26E PER (a five-year forward mean price-earnings ratio, down from 20x). This adjustment better aligns with Zetrix AI’s new role as an open, national platform rather than a specialized concessionaire.

Malaysia Blockchain Infrastructure: Industry-Defining Applications

• MyDigital ID: The digital identity verification platform for individuals, already boasting 2.5 million active users. It is revenue-generating, with Zetrix AI collecting MYR0.40 per authentication transaction from service providers, including government agencies (e.g., Immigration Dept), social media companies, government-linked corporations (GLCs), and startups such as Masverse, iTrace, and Cokeeps.
• MyGov: Provides digital decentralization and notarization of government records, further cementing the platform’s importance in public sector digitalization.

Zetrix AI accrued approximately MYR5 million in VC authentication revenue in 2Q25 alone, with this figure expected to double in 3Q25. For FY25, VC-related revenue is forecast to surpass MYR40 million, forming a critical component of the company’s earnings momentum.

New Revenue Driver: My Superapp Targets Foreign Visitors

The impending launch of the My Superapp is set to act as a catalyst for Zetrix AI’s revenue. This application will enable the digitization of passports and driving licenses for Malaysia’s estimated 40 million annual foreign visitors. Zetrix AI plans to charge MYR100 per application. Even with optional adoption, the revenue potential is substantial should only a fraction of visitors opt for the convenience.

Financial Snapshot: Key Metrics and Performance Trends

• Share price (as of report): MYR 0.98
• 12-month price target: MYR 1.45 (+49%)
• Previous price target: MYR 2.00
• Market capitalization: MYR 7.3B (USD 1.7B)
• Free float: 84.0%
• Issued shares: 7,478 million
• Major shareholders: Asia Internet Holdings (18.2%), Wong Thean Soon (12.2%), KWAP (7.5%)
• 52-week high/low (MYR): 1.05/0.71
• 3-month average turnover: USD 10.2 million

Operational and Financial Highlights

• Revenue Growth: Sustained double-digit growth, with 31.3% YoY in FY24 and more moderate single-digit increases projected ahead as the platform matures.
• Margin Strength: EBITDA margins remained strong, reaching 81.0% in FY24 and projected above 75% through FY27—reflecting high profitability from digital services and scale effects.
• Liquidity and Leverage: Current ratio improves from 2.5x (FY23) to 7.9x (FY27E), and the company transitions to a net cash position from FY25 onwards, illustrating prudent capital management and robust free cash flow.
• Cash Flow Generation: Free cash flow yield expected to leap from 3.6% in FY23 to 12.4% in FY27, with annual net cash flow surging in tandem with business expansion.
• Return on Equity: ROAE peaking at 28.4% (FY24), gradually normalizing to 19.0% (FY27E) as the company scales and equity base expands.

Risks and Considerations

• Prolonged unresolved foreign worker recruitment issues in Malaysia could impact the user base and service adoption.
• Unexpectedly high capital expenditure requirements for further blockchain development could pressure financials.
• Any discontinuity in government concessions to provide e-government IT services would pose a material risk to recurring revenues.

Valuation: Investment Case and Analyst Rating

Zetrix AI is maintained at a ‘BUY’ rating, with a 12-month price target of MYR1.45, implying a 49% upside from current levels. The stock’s forward P/E is attractive relative to regional peers, given its high margins, strong growth outlook, and unique positioning as Malaysia’s national blockchain provider.

The recalibrated valuation reflects a more mature, open-market business model, moving away from reliance on exclusive government contracts and embracing broader national and commercial opportunities.

Historical Recommendation Track Record

• Track record shows consistent ‘BUY’ recommendations, with occasional ‘HOLD’ calls, reflecting confidence in the company’s evolving strategy and market execution.
• Price targets have ranged from RM0.9 to RM2.0 over the past two years, reflecting market volatility and the company’s strategic shifts.

Conclusion: Zetrix AI – A Digital Transformation Powerhouse

Zetrix AI is uniquely positioned to capture Malaysia’s digital identity and blockchain infrastructure opportunity. With robust application launches, early monetization success, and new growth drivers like the My Superapp, the company offers an exciting combination of national relevance, revenue scalability, and strong financial discipline. Investors seeking exposure to next-generation digital infrastructure in Southeast Asia would be well-advised to keep Zetrix AI on their radar.