KUALA LUMPUR (Sept 10): Digistar Corp Bhd rose 4.76% to emerge among the bourse's most-actively traded stocks after the company announced it had received conditional approval for a money lending license from the Urban Wellbeing, Housing and Local Government Ministry.
At 11.08am, Digistar was traded at 33 sen, up 1.5 sen. The sixth-most active stock saw some 24 million shares done.
One stock market trader said the high volume was largely due “speculative trading”, and partly riding on Digistar's licence approval announcement.
The money lending licence is expected to diversify the income base of Digistar, which is popularly known as a broadcast technology specialist.
“Frankly, I think Digistar’s run now is due to speculative buyers. Fund managers may be purchasing it but the excitement will come off eventually and the volume will be thinner,” a trader told theedgemalaysia.com.
Another senior remisier concurred with the view. He said Digistar’s new money lending licence was not the reason for the high trading volume today.
“The money lending licence that Digistar got will not contribute much to the company in terms of earnings per share. The volume today is purely for trading purpose.
“The trading price of around 33 sen exceeds the company’s fundamental value or net tangible assets of 19.6 sen. Investors seem to be accumulating the stock and there may be a shock position coming anytime soon,” he said.