FOLLOWING the withdrawal of its 0.25 sen/share dividend payment announced on Aug 24 to conserve cash and preserve working capital amid unexpected operational expenses, the next immediate concern for Zetrix AI Bhd (previously My E.G. Services Bhd) is the counter potentially slipping into the Practice Note 17 (PN17) status.
Based on the group’s current filings, such risk is on the high side even though an official PN17 status does not mean an automatic delisting or that shares of a Bursa Malaysia Main Market-listed entity are instantly worthless but that a firm must restructure to stay on the stock exchange.
For starters, Zetrix AI has a RM2.16 bil sukuk potential breach with Thursday (Oct 22) deadline to remedy after founder Wong Thean Soon ceased to be the group’s largest shareholder beginning Oct 15 after his combined direct and indirect shareholding dropped to 1.895% following a series of forced share sales by banks.
On top of that, the e-government service provider and blockchain operator has to contend with RM314 mil in JPJ (Road Transport Department) arrears that led to its suspension from Oct 5; MARC downgrade from AA- to BB+IS; and a 93% year-to-date (YTD) share price drop to 5 sen with its market cap having shrunk to RM404 mil.
If sukukholders do not waive and trustee accelerates repayment, that would trigger default/ inability to meet obligations which is classic PN17 ground, followed by 12-month regularisation plan – with prospect of delisting only if its restructuring plan fails to turnaround the group.
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However bleak the prospect is, the scrapping of its proposed 0.25 sen/share dividend payout for the financial year ending Dec 31, 2026 would conserve about RM19.74 mil for some working-capital relief given the company’s 7.898 billion outstanding shares.
Nevertheless, margin call pressure has prompted Wong who is also Zetrix AI’s managing director to part way with yet another 600,000 shares which trimmed his stake to 1.34% as of yesterday (Oct 19), thus further complicating the group’s efforts to remedy a breach of its RM2.16 bil bil sukuk covenant which requires him to remain its largest shareholder by the Oct 22 deadline.
Red flags
Moving forward, Share Traders which is stock trading page on Facebook has put forth five red flags that Zetrix AI investors or punters should be wary of after its stock price dipped to a historic low of 5 sen on Oct 16.
- Dividend withdrawal: The company cancelled its 0.25 sen interim dividend – scheduled to go ex-dividend on Oct 22 – to preserve working capital due to unexpected operational expenses. Trading in its securities was briefly halted on Bursa Malaysia following the announcement.
- Sukuk covenant breach risk: Zetrix AI faces a potential breach of its RM2 bil Sukuk Wakalah programme after managing director Wong Thean Soon (TS Wong) ceased to be the company’s single largest shareholder following forced share sales by banks. The company has until Oct 22, 2026 to remedy the breach.
- JPJ collection suspension: The Road Transport Department (JPJ) and Transport Ministry suspended Zetrix AI and its subsidiary MyEG from acting as collection agents starting Oct 5 due to unremitted government collections totalling RM314 mil (or RM230.9 mil-RM314 mil depending on the reporting agency).
- Police and MACC investigations: The police (Commercial Crime Investigation Department) and the Malaysian Anti-Corruption Commission (MACC) have opened investigation papers into the unremitted funds though Zetrix AI stated its daily operations remain unaffected.
- Rating and auditor setbacks: MARC Ratings revised the company’s MARCWatch status to “negative”, citing governance and transparency concerns following the resignation of its external auditor, TGS TW, in late September alongside potential delays to its planned Nasdaq listing. – Oct 20, 2026
