KUALA LUMPUR (June 14): Serba Dinamik Holdings Bhd fell by as much as 6.5 sen or 10.74% to a new low of 54 sen as heavy selling continued amid its audit woes.
At the noon break, the counter had pared some losses at 55.5 sen, still down five sen or 8.26%.
The counter was the most actively traded stock this morning, with 166.84 million shares traded.
Since the audit issue emerged, the group has lost RM3.93 billion in market value.
In a report last week, UOB Kay Hian analyst Kong Ho Meng cut his earnings forecasts for Serba Dinamik by 25%/19% respectively for the financial year ending Dec 31, 2022 (FY22)/FY23 as he believed that the group may face short-term funding issues that could defer some of its revenue recognition.
He retained his "hold" call on the stock as he maintained his "neutral" view on the dispute between Serba Dinamik and its external auditor KPMG.
“Most of the downside [risk] is likely to have been priced in unless KPMG resigns, owners dump shares or the independent auditor has adverse opinions.
“However, the needed rerating catalysts, which are positive third-party audit reviews and an improving cash flow, will take time,” he said.
Selling pressure on Serba Dinamik, however, continued after its co-founder Datuk Awang Daud Awang Putera last Wednesday and Thursday sold a total of 12.8 million shares in the company.
Following the disposal, his shares were reduced to 62.49 million or 1.69%, from 75.29 million or 2.24%, prior to the audit issue revelation.
In a statement last week, Awang Daud said he sold his shares due to a margin call, and stressed that he was confident in the board of directors safeguarding shareholders' interests.
“The sale of the shares was largely due to technicalities of the stock market margin call and was not an offloading-of-shares exercise”, said Awang Daud.
The Employees Provident Fund (EPF), meanwhile, sold a total of 2.05 million shares in the company between June 2 and 8.
The latest disposal reduced the institutional fund's stake to 9.89% or 366.79 million shares in the company — from 10.18% or 377.7 million on May 27.
Kumpulan Wang Persaraan (Diperbadankan) (KWAP), on the other hand, trimmed its stake to 4.53% after selling 26.18 million shares between May 31 and June 1.
The selldown of these stocks started after KPMG raised questions over Serba Dinamik’s past transactions of over RM3 billion.