This blog is about interesting stuffs hapenning on the Malaysian Stock Exchange.

Wednesday, December 01, 2004

PN4 Condition Company no longer classified separately from Jan 3, 2005.

Bursa Malaysia announced yesterday that the PN4 Condition sector classification will be removed with effect from 3 January 2005. The existing PN4 companies will be placed into their respective sectors prior to them triggering the PN4 requirements. In Feb 2001, Bursa Malaysia started classifying listed companies which were in financial distress or in net liabilities situation into PN4 Condition sector. Bursa Malaysia also introduced a revised framework to replace PN4 condition after the effective date.

Don't know why the Exchange do that. As the new framework is supposed to be stricter, I guess it is a good development. Just that people had been getting used to refer to PN4 companies as companies in bad financial condition. Reclassification may not be necessary.

Tuesday, November 30, 2004

Kumpulan Fima share price rise ahead of sale of LPF stake

You got it? But I missed it again.

However, it may not be too late to use the announcements from Bursa Malaysia to make some money.

Kumpulan Fima, a diversified group listed on the main board of Bursa Malaysia, share price rose today on relatively active trade after the company announced good half year result to the stock exchange and indicated that its proposed disposal of 23% stake in associated company Ladang Perbadana Fima Berhad (LPF) is expected to be completed on or before Dec 9, 2004.

Kumpulan Fima would received RM100.7 million cash from the sale of its stake in LPF, a plantation company listed on Bursa Malaysia. Kumpulan Fima indicated that it would make a net gain of RM53.57 million from the sale or equivalent to RM0.20 per share. This is close to half of current share price.

Besides LPF, Kumpulan Fima has four main business divisions. These are manufacturing, bulking, Food and agro-based, and trading sectors. Kumpulan Fima made RM20.2 million from its core operations in the first half of financial year ending 31 March 2005 before finance cost and profit from associated company. Net earnings per share was 3.87 sen for the first half. If the figure is annualized, Kumpulan Fima is indeed trading at very low price earnings ratio of less than 10 times.

So what do you folks think?

Wednesday, November 24, 2004

Shareholders Tussle at MPLAND?

There appears to be a battling for control of the management in Malaysia Pacific Land (MPLAND), a property company listed on the main board of Bursa Malaysia.

On 1/11/2004, MPLAND announced to the Exchange that it had been served by the High Court a request to hold an EGM by certain shareholders of the company. The resolutions to be tabled at the EGM is to remove the entire board of directors of the company except for one YBhg Dato' Syed Md Amin bin Syed Jan Aljeffri. K-Elite Sdn Bhd, Optima Mewah Sdn Bhd and Top Lander Offshore Inc were the shareholders who requested for the removal of directors.

On 18/11/2004, MeesPierson Trust (Asia) Limited announced that it had accumulated a total of 80.12 million shares or 46.42% stake in MPLAND. It also named K-Elite Sdn Bhd, Optima Mewah Sdn Bhd and Top Lander Offshore Inc as companies where some of its stakes were parked.

A further check on the shareholding change indicated that this group of shareholders had in August exercised 18.59 million warrants at an exercise price of RM1.00 to reach today's 46.42% stake.

It is highly unlikely that the current board members would have enough shares to block the move to get rid of themselves. They may have to buy up more shares from the market or exercise some warrants. With MPLAND now trading at around 42 sen, way below what shareholders paid for the company's rights issue price at RM0.54 earlier this year, the share may soon attract interest.

So far, this piece of news does not seem to have caught the eyes of many. When it does, the share is going to be exciting!!!

Tuesday, November 23, 2004

Big gain for those who read the announcement on shareholder change in TAP

Remember my last post on how you can make money going through announcements on Bursa?

There is another stock which you can make 25% if you read the announcement and understand the significance of it.

TAP Resources Berhad, a second board construction company, announced to the Exchange on 8/11/2004 that there is a new substantial shareholder in the company after Wonderful Wire & Cable Berhad purchased 4.92 million shares representing over 5% of the company's paid up capital. A further check on the company's Annual Report indicated that it would have become the single largest shareholder in the company as the shareholding in the company is quite fragmented (at least on paper).

TAP announced a series of directors appointment on 10/11/2004 including the appointment of a new Executive Chairman and the redesignation of the then Managing Director to an Executive Director of the company. What does that mean? Surely the sign of an entry of a new controlling shareholder.

Well, the Star ran a story on the management change in the company today and this could be the catalyst of today's run-up in the share price of TAP. If you bought the share upon reading the announcement, you should easily get the share below 50 sen. Today, it closed at 60 sen.

So, it pays to do homework!!!

Sunday, November 21, 2004

You can still make money from Bursa Malaysia Announcement!!!

We have witnessed another incident where a hardworking stock researcher can use Bursa Malaysia announcement to make money ahead of reports by newspaper.

D'nonce Technology Berhad, a Second Board company listed on Bursa Malaysia, announced to the exchange late Wednesday (17/11/2004) that it is acquiring a transformer company for RM152 million. The purchase is to be settled by issuance of new shares in the company worth RM152 million. D'nonce share closed at RM0.86 on Wednesday.

I was actually quite surprise that none of the major newspaper carried the story on Thursday (18/11/2004). This is quite a big announcement as the company is effectively going through a reverse takeover. The vendors of the transformer company would end up as the new controlling shareholder in D'nonce. D'nonce share actually fell 6 sen on Thursday to RM0.80. But when the news is reported on newspaper on Friday (19/11/2004) , D'nonce share price surged 12 sen to close at RM0.92, touching a high of RM0.955.

This showed that one can still make some quick bucks from announcements which are not immediately carried on the newspaper. However, this is a significant announcement and maybe D'nonce is not a big enough company to be noticed by the news desk late on Wednesday night.

I actuallty noticed the announcement and had in fact keyed in the order to purchase D'nonce based on overnight price on Thursday morning. However, upon knowing there was no buyers in the queue, I chickened out. I was actually quite glad later that day as I saw there were a lot of sellers trying to sell at lower price. D'nonce share actually ended the day lower by 6 sen, which is quite massive drop in percentage terms.

But when I saw how the share performed on Friday. I began to wonder what if my dealer were slow in cancelling my buy order. What a spectacular miss!

Nevertheless, this acquisition by D'nonce is just at proposal stage and would be subjected to approvals by Securities Commissions and other relevant authorities. This kind news would only fit the appetite of punters.

Saturday, November 20, 2004

Air Asia share price to do well on debut?

Air Asia, which failed to secure its indicative IPO (Initial Public Offering) price after a global bookbuilding exercise, may do well when its shares start trading on Bursa Malaysia on Monday.

AirAsia Bhd's IPO retail portion has been priced at RM1.1625 per share and the institutional shares at RM1.25 per share after a global bookbuilding process - some 17% discount to the indicative prices of RM1.40 and RM1.51 respectively.

At the time of bookbuilding, where fund managers bid for Air Asia shares, the oil price was hovering at around US$55. Price of oil has since fell to well below US$50. As a result, fund managers see Air Asia doing well on debut.

The price debuts of this year's major IPOs are mixed. KLCC Property Holdings Bhd (KLCCP), the largest initial public offering this year, closed at RM1.69, which is 11 sen lower than the RM1.80 paid by institutional investors under the listing exercise on the first day of trading. Sin Chew Media Corporation, who publishes the top selling Chinese daily in the country, did well on its debut when its share price ended first day at RM2.60, 15sen higher than the institutional subscription price of RM2.45.

With the market sentiment more bullish now, I think Air Asia could trade around its previous indicative IPO prices. Maybe it can even do a Google on IPO! Google's IPO price at US$85, was also set below indicative price range of US$108-US$135. But 60 days after its debut, Google share price had doubled.

However, this is not likely. Air Asia is not at the same level as Google. But it may surprise on the upside.

Thursday, November 18, 2004

Rubberex yet to announce new exercise price for its warrants

Rubberex Corporation, a glove manufacturer listed on the Exchange Second Board, has yet to announce the new exercise price for its warrants 10 days after the company shares and warrants went ex-bonus. The company declared a bonus issue of new shares and warrants at a ratio of one new share/warrant for every 3 shares/warrants held before 8th November 2004.

The company said in its announcement on 13th August 2004 that the actual adjustments to the number and exercise price of the additional new warrants to be issued will only be determined on the entitlement date of 10th November 2004. The company had earlier in its circular to shareholder dated 7th May 2004 indicated that notice would be sent to warrant holders within 21 days after date of entitlement on the new exercise price of the warrant.

The question here is shouldn't Rubberex make an announcement to the exchange immediately after 10th November on the new exercise price. It is actually quite easy to calculate the new exercise price. Based on a 1 for 3 bonus, the exercise price should be adjusted from RM2.42 to RM1.815. The company had wanted to ascertain the exact number of shares be held before the bonus issue before determining the adjustments to the number and exercise price of the warrants. Number of shares may increase before the bonus entitlement date due to exercie of employees share options and outstanding warrants.

What ever the reason, the company need not take 10 days (and counting) to make the announcement on the new exercise price. Investing public would now assume the exercise price is still RM2.42 in the absence of any announcements. The news media would have carried the inaccurate exercise price in its stock price tables.

We continue to see how long Rubberex would need to make such straight forward announcement...