KUALA LUMPUR (May 9): Luxchem Corp Bhd, which saw its first quarter ended March 31, 2016 (1QFY16) net profits leap 4.5 times to RM7 million, dropped 3.51% at mid-morning today due to profit-taking.

At 10.40am, the stock dipped six sen to RM1.65, after narrowing from 4.09%, with 1.26 million shares transacted for a market capitalisation of RM445.4 million. Year-to-date the stock has dropped 0.6%.

On Friday, the industrial chemical supplier showed net profits at RM7 million or 2.64 sen per share from RM1.55 million or 0.6 sen share a year earlier.

It attributed the jump to the share option expenses amounting to RM8.48 million charged during 1QFY15.

Revenue was 7.3% lower at RM159.97 million against RM172.54 million in 1QFY15 due to lower revenue from the trading sector.

Interpacific Securities Sdn Bhd remisier Sam Ng told theedgemarkets.com that short-term investors were involved in profit-taking after the stock appreciated to RM1 nearly 10 months ago.

“The counter has been moving up with major shareholders in control but I notice that short-term investors are engaged in profit-taking due to its performance,” he said.

SJ Securities Sdn Bhd remisier Goh Kay Chong said his chart on the counter showed active `hot money’ selling and retailers buying.

“Retailers constituted 82% while hot money made up 18%. Retailers are normally defensive as they buy and keep. That does not push up the counter but hot money can do that,” he said.

He added that the counter came down due to profit-taking.

Hot money means money that flows in the market as investors try to earn the most out of a short-term investments.