Insider Moves: Tanjung Offshore, Amway, Unisem, Integrax, Tenaga Nasional, Perak Corp and Raya International

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NOTABLE filings

Notable shareholding changes in companies listed on Bursa Malaysia between Feb 13 and 17 included the acquisition of some 24.17 million shares in Tanjung Offshore Bhd (fundamental: 1.95; valuation: 1.80) by a new substantial shareholder.

In a Feb 17 filing, the company disclosed that Tanjung’s non-independent director Tan Sri Tan Kean Soon had a direct 6.5% stake as at Jan 30. He was also deemed interested in a 1.08% stake. Tan was suspended as a director on Jan 28 after Tanjung’s independent committee discovered possible conflicts of interest and breaches of fiduciary duty related to several acquisitions made by the company.

Meanwhile, the Employees Provident Fund pared down its stake in Amway (M) Holdings Bhd (fundamental: 2.50; valuation: 0.90) by disposing of 1.59 million shares on Jan 21 and Feb 11, according to a Feb 13 filing. The disposals left the provident fund with a 6.06% stake in Amway, a little above the 5% substantial shareholding threshold. The lightly traded stock’s price is currently flat on a year-on-year basis at Feb 24’s close of RM11.24.

The direct-selling company reported a slowdown in earnings in its latest financial year ended Dec 31, 2014 (FY2014), which saw its net profit decline 8.4% to RM99.95 million from RM109.08 million in FY2013. In its latest earnings announcement, Amway expects 2015 to be a very challenging year in light of the weakening of the ringgit against the US dollar as well as the implementation of the Goods and Services Tax (GST) on April 1.

Over at Unisem (M) Bhd (fundamental: 1.25; valuation: 0.60), Lembaga Tabung Haji sold some 10.28 million shares between Feb 5 and 12, bringing down its stake to 5.3%. The disposals occurred ahead of Unisem’s fourth-quarter earnings announcement on Feb 12. The Pilgrims Fund Board has been paring down its stake from 6.9% since January, in tandem with the stock’s steady appreciation. Since Jan 2, Unisem’s stock price has risen from RM1.75 to RM2.10 on Feb 24.

Largely aided by stronger global demand as well as the boost in its export earnings from the strengthening of the US dollar, Unisem bounced back into profitability for FY2014 with a net profit of RM68.42 million, compared with a RM105.37 million net loss in FY2013.

Notable movements

Integrax Bhd’s (fundamental: 1.65; valuation: 0.60) substantial shareholder Amin Halim Rasip is acquiring more stock in light of Tenaga Nasional Bhd’s takeover offer for the company. Amin, who disapproves of Tenaga’s buyout offer price of RM2.75 per Integrax share, bought 220,400 shares on Feb 17 to bring his stake up to 23%. From Jan 9 — when Tenaga’s takeover offer was first announced — to Feb 24, he had raised his stake by some 1.9 million shares.  

On Feb 24, the stock closed at RM3 or a 25 sen premium to Tenaga’s offer of RM2.75 apiece, even as investors anticipate a higher offer from the utility company.

On Feb 23, another substantial shareholder, Perak Corp Bhd, also announced its rejection of the RM2.75 offer price, triggering speculation that Tenaga may be willing to increase its offer price. Compared with its recent low of RM1.90 on Oct 16, 2014, Integrax share price has risen 57.9% in just over four months.

Another notable movement was seen at Raya International Bhd (fundamental: 0.35; valuation: 0.00), whose share price has increased 44.8% over six weeks from 14.5 sen on Jan 9 to 21 sen  on Feb 24 although some of its shareholders have pared down their stakes.

Non-executive director Md Yaakob Md Shariff sold all his shares (5.2 million) or a 3.9% stake, in the air-filter maker at 19 sen apiece on Feb 17. Harry Lee Vui Khiun ceased to be a substantial shareholder on Feb 12 after selling some 7.39 million shares or a 5.6% stake on the open market.

(Note: The Edge Research’s fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also 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 March 2-8, 2015.