Maybank Investment Bank Berhad
Report Date: September 18, 2025

Mynews Holdings Berhad (MNHB): Poised for Robust Growth and Margin Expansion in Malaysian Convenience Retail

Executive Summary

Mynews Holdings Berhad (MNHB), a leading name in Malaysia’s convenience retail sector, is on a strong growth trajectory backed by strategic cost management, expansion into higher-margin fresh food categories, and successful turnaround in key business segments. This comprehensive analysis covers MNHB’s latest financial performance, operational highlights, ESG initiatives, and detailed forecasts for investors and market watchers.

Broker Rating and Price Target

• Broker: Maybank Investment Bank Berhad
• Date: September 18, 2025
• Current Share Price: MYR 0.62
• Target Price: MYR 0.85 (+40%)
• Investment Rating: BUY

Key Investment Thesis

• MNHB’s earnings outlook remains positive, driven by improved cost management and steady sales growth.
• Successful turnaround of its CU stores and food processing centre (FPC) has put the company on firmer footing for margin expansion.
• Expansion into higher-margin fresh food categories is set to further boost profitability.
• Strong store footprint expansion, with a focus on Mynews, CU, SuperValue, and Maru Kafe formats.

Operational and Financial Highlights

Solid Store Network Expansion

• MNHB operates 679 stores (as of end-3QFY25):
• Mynews: 461
• Mynews SuperValue: 37
• CU: 154
• Maru Kafe: 7
• Store count up by 53 YoY, with a target to open approximately 100 new stores in FY26.
• Footfall increased by 9% YoY in 3QFY25.

Strong Revenue and Earnings Growth

• 9MFY25 revenue growth: +9% YoY
• Same-store sales growth (SSSG): positive, but muted at 1-2% YoY
• CU and FPC segments turned profitable in 3QFY25
• FPC running at 70% utilisation, with potential for additional production shift
• FY25E earnings growth projected at +82% YoY

Value Proposition and Competitive Positioning

• MNHB operates under multiple brands: Mynews, Mynews SuperValue, Maru Kafe, and is master franchisee for South Korean CVS brand CU.
• Product mix includes tobacco, food and beverage, non-food, and consumer services.
• Rapid store expansion and improvements in average sales per store have driven a 3-year revenue CAGR of +27%.
• Strategic shift towards higher-margin fresh food categories, reducing reliance on tobacco sales.

Recent Performance Drivers

• Losses in CU and FPC segments have been stemmed with both now profitable.
• Quarterly EBIT margins stabilized at around 3% since 1QFY24.
• Management expects momentum in sales and footfall to continue into 4QFY25, boosted by consumer sentiment and government cash aid (MYR100 SARA).
• Key shareholders include D&D Consolidated Sdn. Bhd. (52.9%), Jag Capital Holdings Sdn. Bhd. (13.9%), and DANG TAI KIEN (3%).

Price Performance and Peer Comparison

• 52-week high/low: MYR 0.70 / 0.51
• Market capitalization: MYR 461.5M (USD 110M)
• Free float: 0.1%
• Issued shares: 750M

ESG and Sustainability Initiatives

• MNHB faces ESG challenges typical of convenience stores, including single-use plastic and food waste.
• Government regulations have resulted in lower plastic usage per transaction and higher adoption of biodegradable plastics (82% in 2023 vs. 90% in 2022).
• 70% of stores use energy-saving LED lights.
• Food wastage from in-house manufacturing remains an area of improvement; ongoing efforts include seeking partnerships for recycling/repurposing.
• Board diversity: 33% women, 50% independent directors, separate Chairman and CEO roles.
• Workforce: 43% female, 30% foreign workers.
• Sustainability committee in place; senior management remuneration linked to ESG targets.
• Current ESG score: 50/100, with improvement from previous reviews but still lacking formal long-term targets.

Financial Metrics and Ratios

• EBITDA margin: 14.2% (FY25E), trending down to 8.8% by FY27E due to higher costs with expansion.
• ROAE: Expected to reach 9.7% by FY27E.
• Net gearing expected to remain at net cash levels from FY25E onwards.
• Dividend yield stable at 1.6% for FY25E-FY27E.
• Capex/revenue ratio maintained at 4.6% over FY25E-FY27E.

Business Model Risks and Opportunities

• Upside:
• Stronger-than-expected sales growth, higher average basket size, rapid store expansion.
• Diversification away from tobacco to higher-margin food categories.
• Downside:
• Weak consumer spending due to economic uncertainties.
• Potential pressure on margins from future minimum wage increases.
• Delays in new store openings.

Conclusion: Investment Outlook

MNHB is well-positioned for robust growth in the coming years, underpinned by its strong store network, improving profitability, and strategic shift into higher-margin product categories. Management’s ongoing efforts in cost control, ESG, and expansion should sustain earnings momentum. With a BUY rating and a 40% upside to the target price, MNHB presents an attractive investment case for those seeking exposure to Malaysia’s dynamic consumer discretionary sector.

Contact Information

• Lead Analyst: Jade Tam, Maybank Investment Bank Berhad
• Email: [email protected]
• Phone: (603) 2297 8687

About Maybank Investment Bank Berhad

• Maybank Investment Bank Berhad is a leading financial services provider covering equity research across Malaysia and ASEAN.