Thursday 28 Mar 2024
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This article first appeared in The Edge Financial Daily, on October 21, 2016.

 

Hibiscus Petroleum Bhd (-ve)

SHARES in Hibiscus Petroleum Bhd (fundamental: 0.8/3; valuation: 0.9/3), which triggered our momentum algorithm yesterday for the third time this month, rose 2.5 sen or 10.6% to close at 26 sen.

It saw 81.44 million shares traded, compared with its 200-day average volume of 7.24 million shares. It was the most actively traded counter on the local bourse yesterday.

On Wednesday, Hibiscus announced that its wholly-owned subsidiary, SEA Hibiscus Sdn Bhd, will buy Shell’s 50% interest and operatorship in the 2011 North Sabah Enhanced Oil Recovery production sharing contract (PSC) for US$25 million (RM104.5 million).

The remaining 50% interest in the PSC is held by Petronas Carigali Sdn Bhd.

Hibiscus said the funding will be a mix of internal funds and credit facilities.

The buy, expected to complete in 2017, is anticipated to contribute positively to its future earnings.

The stock currently trades at 0.58 times its book value.

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