This article first appeared in The Edge Financial Daily on March 3, 2020

Ornapaper Bhd (-ve)

TRADING of shares in Ornapaper Bhd (fundamental: 1.4/3, valuation: 2/3) triggered our momentum algorithm yesterday for the fourth time this year. The company’s share price closed five sen or 3.91% lower at RM1.23 after 1.32 million shares were traded, seven times higher compared to the counter’s 200-day average trading volume of 183,636 shares.

The group is principally involved in the manufacturing and supply of corrugated boards and cartons for packaging.

Last Tuesday, Ornapaper reported a 83.1% jump in its net profit for the fourth quarter ended Dec 31, 2019 to RM5.31 million, from RM2.9 million a year prior, despite lower revenue, as it enjoyed lower raw material prices. Revenue was down 3% at RM90.94 million from RM93.74 million previously.

While it said the business environment remains challenging amid uncertainties brought by the Covid-19 outbreak and rising labour costs, Ornapaper is cautiously optimistic that it will maintain its positive financial performance in 2020.