KUALA LUMPUR (Nov 7): Velesto Energy Bhd shareholders are smiling even more broadly now.
Its share price hit 40 sen — the highest closing since January last year — at the end of trading today amid persistent interest in the oil rig operator.
Those who subscribed to the 14-for-5 renounceable rights issues at 30 sen per share (pre-adjusted price) are being rewarded now with the leap in share price.
More oil rigs chartered in Malaysian waters and Joint Development Area give a glimmer of hope that activities are picking up for real this time around.
There were 124.3 million shares traded today, making Velesto the most traded counter on Bursa Malaysia.
In fact, Velesto has been on the high-volume list in recent weeks.
Considering its share price has more than doubled and is nearing analysts’ target prices, some analysts are suggesting that their clients take some profit.
Meanwhile, the oil & gas conglomerate Sapura Energy Bhd seems like one big boat that has yet to be lifted by the rising tide in the oil & gas industry.
It was the second most traded counter today with 102.4 million shares changing hands. However, its share price was up only 0.5 sen to close at 27 sen. The stock is down 5.3% year-to-date.
According to analysts polled by Bloomberg, there are six “buy” calls.
The average target price of Sapura Energy is 35 sen — a nearly 30% upside at current levels.
Analysts’ target prices currently range between 25 sen and 50 sen.
Bumi Armada Bhd is the third most-traded stock with 88.1 million shares changing hands.
The stock just keeps reaching new year highs after news that its substantial shareholder T Ananda Krishnan’s private investment vehicle, Usaha Tegas Sdn Bhd, is throwing the company a life line by offering loans of up to US$75 million (RM317 million) to the financially-ailing group.
Usaha Tegas is Bumi Armada's single largest shareholder with a 34.9% stake via Objektif Bersatu Sdn Bhd.
Year to date, Bumi Armada has more than tripled since the start of the year.
Kumpulan Powernet Bhd’s share price soared to an all time high of RM1.57, the gap is even wider now against the general offer price of RM1. Hence, it is now even less convincing for minority shareholders to accept the general offer.
Independent advisor Mercury Securities Sdn Bhd deemed the offer as "fair" and "reasonable".
Mercury Securities advised minority shareholders to accept the general offer of RM1 launched by Serba Dinamik Holdings Bhd group managing director and CEO Datuk Dr Mohd Abdul Karim Abdullah. However, the offer price is in fact 40 sen below the market price.
On the other hand, it leaves many to wonder what has driven the such strong rally on the warp-knitted fabrics manufacturer. Furthermore, what Dr Mohd has in pipeline for Kumpulan Powernet.
GDB Holdings Bhd secured another construction contract from conglomerate Hap Seng Bhd.
This time around, they will be building the Hyatt Centric hotel in Kota Kinabalu, Sabah, for a provisional contract value of RM213.3 million.
The announcement was made at the lunch break.
The news helped to spark buying interest in the construction stock in the afternoon trading session.
Its share price gained two sen to a record high of 39.5 sen.
Few might notice that GDB’s share price has rallied nearly 72% year to date.
GDB group managing director Cheah Ham Cheia said the latest award is GDB’s second contract won from Hap Seng, having secured the 26-storey Menara Hap Seng 3 in Kuala Lumpur City Centre in 2017.
Including the new contract, GDB has secured new jobs worth RM865.3 million year-to-date. Its outstanding order book stands at about RM1.2 billion that will last for at least three years.
Chemical Company of Malaysia Bhd’s (CCM) share price drifted lower today to close at RM1.40, down four sen. Year to date, the stock has slipped 21.8% from its peak of RM2.12 in July.
The downward trend on caustic soda price raises concerns on CCM’s earnings prospects, as weaker caustic soda price will squeeze the group’s margin.
The group’s profit was already down in the first six months ended June 30.
Its net profit slid 26% to RM9.23 million in the period from RM12.49 million, while revenue shrank to RM189.8 million from RM200.4 million.
Caustic soda makes up slightly over 40% of CCM’s annual revenue for the financial year ended Dec 31, 2019 (FY19).
According to Bloomberg, caustic soda price dropped to US$260 per tonne as at end October.