KUALA LUMPUR (Nov 29): Poultry company CAB Cakaran Corporation Bhd (CAB) announced that its shares will be suspended from trading coming Monday pending the release of a material announcement.
Its share price hit an all-time high of RM1.19 on Friday with a sudden surge in trading interest. Trading volume of the small-cap stock swell to 5.4 million shares compared with a mere 976,500 shares the day before. Its market capitalisation is at RM156.56 million. Its share price has doubled year to date climbing from 55 sen in early January.
CAB had been picked by Insider Asia as stock with likelihood of corporate exercise on Nov 11.
Insider Asia noted that there have been reports indicating that US-based Cargill group is interested in acquiring a stake in CAB, although pricing is an issue.
Other than it being comparatively cheaper in valuation comparing to its industry peers, the research house noted that the poultry industry has seen a number of merger and acquisition activities lately.
CAB had on early October, entered into a Heads of Agreement, which proposed to acquire a 51% stake in Singapore-based poultry company Tong Huat Poultry Processing Factory Pte Ltd, for S$7.5 million (RM19.2 million).
CAB said that the corporate exercise is expected to complete by March next year, and that the acquisition would boost its revenue by 25%.
As at Sept 30, 2014, CAB’s cash and bank balances stood at RM15.29 million.
For the financial year ended Sept 30, CAB posted an unaudited net profit of RM11.17 million, 6.4% lower against RM11.94 million in FY13. However, revenue was up by 10.4%, to RM672.4 million, from RM609 million.
EPS fell to 8.49 sen in FY14 from 9.07 sen the year before.