KUALA LUMPUR (Aug 5): Euro Holdings Bhd emerged as the second actively traded stock on Bursa Malaysia on Friday (Aug 5), as its trading volume shares spiked to 179.93 million — the highest in over a year, and about 30.19 times its 200-day average volume of 5.96 million shares.
This is the highest trading volume Euro Holdings recorded since June 18, 2021, when the counter saw 240.52 million shares done.
It is unclear at press time as to what drove the sudden surge of trading interest in the counter, which closed 1.5 sen or 9.38% lower at 14.5 sen, valuing the furniture maker at RM112.12 million. The stock has fallen 70.41% from when it was trading at 49 sen on Jan 3.
According to a note from Public Invest Research earlier on the same day, Euro is potentially staging a breakout from its sideways channel, with anticipation of continuous improvement in both momentum and trend in the near term.
“Should immediate resistance level of RM0.175 be broken with renewed buying interest, it may continue to lift [the] price higher to [the] subsequent resistance level of RM0.200.
“However, failure to hold on to [the] support level of RM0.140 may indicate weakness in the share price and hence, a cut-loss signal,” it said.
On June 24, Euro Holdings proposed to raise some RM20.05 million via a private placement for its general working capital expenses and repayment of bank borrowings.
The group is expected to reduce its financing costs and gearing ratio from 0.64 times to 0.3 times.
Bloomberg data showed that Euro Holdings’s largest shareholder SPA Furniture (M) Sdn Bhd, which is the holding company of Group Managing Director Datuk Seri Lim Teck Boon, holds a 54% stake in the group. The second largest shareholder is Perfect Hexagon Commodity, with 8.85%.
For the first quarter ended March 31, 2022 (1QFY22), the group’s net profit slumped 93.3% to RM33,000 from RM490,000 in 1QFY21, dragged by a surge in raw material prices, despite revenue soaring 262% to RM58.9 million from RM16.26 million, on stronger contribution from its manufacturing division.