KUALA LUMPUR: Unisem (M) Bhd chairman and group managing director John Chia Sin Tet has placed out 15 million of his shares, representing about 2.16% in the semiconductor manufacturer to an institutional investor for a total of RM34.35 million, or RM2.29 each.

The filing with Bursa Malaysia yesterday shows that Chia’s investment vehicle Jayvest Holdings Sdn Bhd sold the block of shares last Thursday.

In the filing, Unisem (fundamental: 1.25; valuation: 0.6) revealed that Jayvest intends to utilise the proceeds from the share placement for the exercise and conversion of its warrants into ordinary shares within the next few weeks. The exercise of the warrants to maintain his shareholding is seen as an indication of Chia’s confidence in the company’s prospects, analysts said. The share sale came on the heels of a rally on Unisem’s share price which has more than doubled since January 2014. The stock marched to its 10-year high of RM2.54 in mid-May from a low of RM1.03 in January last year. It closed at RM2.38 yesterday. 

Also, the semiconductor firm has witnessed a strong earnings recovery in the financial year ended Dec 31, 2014. It returned to the black with net profit of RM67.75 million compared with a net loss of RM109.28 million the year before. Revenue was also higher at RM1.038 billion.

For its first financial quarter ended March 31, 2015 (1QFY15), Unisem achieved a 154% jump in net profit to RM23.54 million from RM9.27 million, due to a change in product mix and improvement in utilisation rates. Revenue grew 22.8% to RM280.06 million during the quarter.

Unisem currently commands 2% of the global semiconductor market. The group, through its three Asian plants, caters to parts suppliers, who serve big mobile gadgets brands such as Apple, Samsung, Xiaomi and Lenovo that form 98% of its customer base — besides those from the automotive industry.

Chia is the single largest shareholder in Unisem, holding a direct 6.14% stake and 16.3% indirect stake through vehicles Jayvest and Bandar Rasah Sdn Bhd.

A representative from Unisem declined to reveal the identity of the institutional investor. Among Unisem’s notable institutional investors is Lembaga Tabung Haji. The pilgrimage fund now holds a 2.81% stake in the company.

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. Go to www.theedgemarkets.com for more details on a company’s financial dashboard.

This article first appeared in The Edge Financial Daily, on July 14, 2015.