Paos Holdings Bhd (-ve)

SHARES in Paos Holdings Bhd (fundamental: 2.35/3, valuation: 1.4/3) closed up 2 sen or 1.71% at RM1.19 last Thursday, the second time it triggered our momentum algorithm this year.

Some 478,800 of its shares were exchanged, compared to 46,245 shares in the last 200 days.

On Sept 9, the soap manufacturer and owner of The 5 Elements Hotel in Jalan Sultan, Kuala Lumpur, announced its plan to issue 60.39 million bonus new shares, on the basis of one bonus share for every two existing shares held (1-for-2), to improve the trading liquidity of its shares.

The bonus issue will be followed by the issuance of 90.58 million free warrants on the basis of one warrant for every two shares held.

At the current share price, Paos is trading at 1.43 times its book value and at 41.6 times its trailing 12-month price earnings.