Stock With Momentum: Kobay Technology

Stock With Momentum: Kobay Technology
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This article first appeared in The Edge Financial Daily, on October 27, 2015.

Kobay Technology Bhd (-ve)

Kobay (Fundamental: 2.5/3, Valuation: 1.4/3) was picked by our momentum algorithm for the second consecutive trading day. Despite an unusual market activity (UMA) query by Bursa Malaysia last Friday — after a 29.9% jump in its share price — the thinly traded stock added another 2.0% to close at RM1.55 yesterday.

In reply to Bursa’s query, Kobay disclosed that it received a Letter of Intent, in mid-October, from a prospective buyer to acquire a 1.54-acre vacant land in Penang. However, the terms and conditions have not been finalized at this juncture.

Kobay is mainly involved in the manufacturing of precision metal components, precision tooling and equipment, and metal fabrication. Export, mainly to Singapore and the US, accounted for 41.8% of its revenue in FYJune2015.

The company has entered into several joint ventures for property development projects in Penang, Perak and Kuala Lumpur. It expects to launch at least one project by 2QFY2016.