KUALA LUMPUR (Dec 7): CAB Cakaran Corporation Bhd shares rose to an all-time high today, climbing as much as 4.73% in mid-morning trading, on the back of news that Indonesia’s largest conglomerate Salim Group is purportedly eyeing a 20% stake in the poultry player.

At 10.19am, the shares rose as much as 8 sen to RM1.77 before paring gains and settling at RM1.73. A total of 1.89 million shares were traded.

Year to date, the stock has risen 65.69%, outperforming the FBM KLCI which decreased 5.6%.

In its cover strory today, The Edge Financial Daily had reported, citing a source, Salim Group and the Penang-based poultry company have been in talks for some time now and the deal is close to being sealed.

Details of the deal, however, are not known, but CAB Cakaran’s largest shareholder is its executive chairman Chuah Ah Bee, 64, who controls some 55% of the company with his wife, CAB Cakaran executive director Chan Kim Keow, the report stated.

Shares of the company hit a high of RM1.69 last Friday, giving the company a market capitalisation of RM254.6 million, which would indicate that the 20% block has a market value of RM50.92 million.

CAB Cakaran sells eggs and broiler chickens to Singapore and also operates Malaysian fast food chain Kyros Kebab while Salim Group is a major player in Indonesia’s agribusiness and consumer product sector.

Indofood Sukses Makmur Tbk, Indonesia’s largest food processing company and the world’s largest producer of instant noodles, forms part of the group.

CAB Cakaran (fundamental: 0.55; valuation: 1.1) was picked up twice this year as a Stock With Momentum by Asia Analytica Sdn Bhd – today and Oct 27.

Asia Analytica noted that the stock’s performance last Friday was also propelled by its fourth quarter of financial year 2015 (4QFY15) results announced to Bursa Malaysia on Nov 30.

The company saw a 31.09% increase in net profit to RM8.8 million or 5.85 sen per share in 4QFY15 compared to RM6.71 million or 5.10 sen per share whereby the company recorded in the previous corresponding period mainly due to the inclusion of the results of its newly acquired subsidiaries in Singapore, namely Tong Huat Poultry Pte Ltd and Ban Hong Poultry Pte Ltd.

However, pre-tax profit — excluding a fair value gain on investment properties of RM6.4 million — fell 11.1% to RM9.9 million, mainly due to lower average selling prices of broilers, the financial analyst company reportedly said.

Revenue rose 46.6% year-on-year to RM262.8 million, boosted by higher sales from the integrated poultry farming and processing division.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)