KUALA LUMPUR (July 1): Frenzied buying of Genetec Technology Bhd shares continued pushing the stock to an intra-day high of RM10.60, up RM2.10 or 24.7% in the afternoon session.
The strong buying interest was partly due to CGS-CIMB having highlighted that the loss-making company, which specialises in automated industrial systems, is a proxy to the electric vehicle (EV) industry.
The counter had pared some gains at the closing bell, but it still jumped RM1.52 or nearly 18% to close at RM10.02.
Trading volume stood at 3.17 million shares, over six times its 65-day average of 510,620 shares, which is half of its recent peak of 6.2 million shares on Tuesday.
At the closing price of RM10.02, Genetec had a market capitalisation of RM504.11 million. The counter had gained some 479% since its close of RM1.73 on Dec 31, 2020.
In a preliminary note on the company by CGS-CIMB on Monday, the research house said Genetec is one of several Bursa Malaysia-listed companies with exposure to the EV and battery space, which made up 93% of its RM205.6 million orders secured since February this year.
The order book itself represented over two times its revenue for the financial year ended March 31, 2021 (FY21), the research house said.
“While Genetec was loss making in FY21, it is confident that the worst is over and expects stronger results going forward, backed by a strong order book and established relationships with global EV manufacturers,” CGS-CIMB said.
“Genetec had a net cash position of RM27.5 million at end-FY21,” it added.
For FY21, Genetec's net loss widened to RM4.25 million from RM166,000 for FY20 due to lower margins, higher operating cost, foreign exchange (forex) losses and one-off employee option scheme expenses.
This was despite its revenue rising 20.85% to RM97.08 million from RM80.33 million, on higher sales volume incurred.