Insider Moves: Hubline, QL Resources, Masterskill, AE Multi Holdings, UMW Oil & Gas, SOPB, Eversendai, EPF, Perisai Petroleum, FGV and Bumi Armada

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NOTABLE filings

Between Jan 5 and 9, notable shareholding changes in companies listed on Bursa Malaysia included the disposal of 150 million Hubline Bhd (fundamental: 0.35; valuation: 1.2) shares by Billion Power Sdn Bhd, which ceased to be a substantial shareholder on Dec 30 last year.

Billion Power is controlled by Ling Peck Yii, the sister of Hubline managing director Dennis Ling. Since the beginning of 2014, the Ling family has been steadily selling off its stake in Hubline, reducing it from 16.37% in February.

Meanwhile, agro-food company QL Resources Bhd (fundamental: 1.1; valuation:1.5) continues to accumulate shares in Lay Hong Bhd  (fundamental: 0.45; valuation: 0.6) following its failed takeover bid for the company. QL Resources bought 27,400 Lay Hong shares on the open market between Dec 30 and Jan 7.

On Jan 8, Masterskill Education Group Bhd (fundamental: 1.2; valuation: 0.6) saw 72.446 million shares move from British Virgin Islands-registered Raphia Ltd to Arenga Pinnata Sdn Bhd, which is controlled by Creador II LLC, the private equity fund of Brahmal Vasudevan.

Arenga Pinnata made a conditional offer for the remaining Masterskill shares at 60 sen apiece on Jan 12.

Yang Wu-Hsiung ceased to be a substantial shareholder in loss-making AE Multi Holdings Bhd (fundamental: 0.35; valuation: 0.6) after he sold 1.11 million of its shares on Jan 6. The Taiwanese national had emerged as a substantial shareholder only on Dec 18 after acquiring 6.77 million shares, but had since disposed of them.

Note that AE Multi Holdings, whose subsidiaries manufacture and sell printed circuit boards, has just completed a fundraising exercise involving 87.85 million rights shares and 65.89 million warrants that raised RM15.81 million.

During the period under review, the Employees Provident Fund (EPF) disposed of 21.54 million UMW Oil & Gas Corp Bhd (fundamental: 1.45; valuation: 0.6) shares or a 1% stake. It retains 5.86% equity interest in the company.

On Jan 5, HSBC Holdings PLC UK ceased to be a substantial shareholder in Sarawak Oil Palms Bhd (fundamental: 1.4; valuation: 1.8) after disposing of four million shares in the company.

Notable movements

At the close of 2014, construction group Eversendai Corp Bhd (fundamental: 0.75; valuation: 1.2) saw its stock jump 36.8% from its opening price of 57 sen. This was surprising because the counter had been on a steady decline for most of the year. The share price corrected almost immediately the next trading day and at its close of 51 sen last Wednesday, it was 51% lower than a year ago.

Amid the strange share price movement that coincided with the closing of many funds’ financial year, the EPF has been actively trading Eversendai’s shares.
On Dec 31 alone, it disposed of 375,000 shares and on Jan 6, some 2.072 million shares. The EPF still has a 7.1% stake in Eversendai.

In the new year, the retirement fund sold down its position in several other companies that had seen sharp share price declines.

For instance, it ceased to be a substantial shareholder in Perisai Petroleum Teknologi Bhd (fundamental: 0.35; valuation: 1.2) after disposing of 1.35 million shares on Dec 30. The stock has fallen 73.21% over the past one year and closed at 45 sen last Wednesday.

The EPF also sold nine million shares in agribusiness giant Felda Global Ventures Holdings Bhd (fundamental: 2.1; valuation: 2.4) on Dec 30 and 31 while Kumpulan Wang Persaraan sold 19.817 million FGV shares. FGV’s share price has been on a downward trend, falling 49.12% to RM2.15 in the past one year.

Another stock in which the EPF trimmed its holding is Bumi Armada Bhd (fundamental: 1.4; valuation: 0.6), selling 2.22 million shares during the period under review. The offshore oilfield service provider closed at RM1.19 last week, down 51.3% from a year ago.

Note:  The Edge Research’s fundamental score reflects a company’s profitability and its balance sheet strength based on historical numbers. The valuation score determines if a stock is attractively valued or not, based on historical numbers.
A score of 3 suggests strong fundamentals and attractive valuations.

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This article first appeared in The Edge Malaysia Weekly, on January 19-25, 2015.