This article first appeared in The Edge Financial Daily on June 7, 2017

Chuan Huat Resources Bhd (+ve)

SHARES in Chuan Huat Resources Bhd (fundamental: 0.35/3, valuation: 1.1/3), a stockist of iron and steel, importer and exporter of structural steel and other construction materials, triggered our proprietary momentum algorithm yesterday.

The stock closed 5.5 sen or 9.91% higher at 61 sen with a volume of 4.45 million shares, exceeding its 200-day average volume of 238,242.5 shares.

Chuan Huat also undertakes manufacturing activities involving the production of computer diskettes and compatible and remanufactured ink cartridges, as well as retailing.

In the first financial quarter ended March 31, 2017 (1QFY17), its net profit expanded by 339% to RM2.93 million from RM667,000 a year ago on better profit margin of steel products, from the trading of hardware and building materials, and improved performance in the trading of information and technology-related products and others.

Quarterly revenue grew nearly 13% to RM162.12 million from RM143.52 million in 1QFY16. At the current share price, Chuan Huat is trading at 0.38 times its book value.