This article first appeared in The Edge Financial Daily, on September 15, 2016.

KUALA LUMPUR: Melewar Industrial Group Bhd (MIG) said the unusual market activity in the trading of its shares may be due to a rally in the stock price of its subsidiary, Mycron Steel Bhd.

“At [the] MIG company level, its 71.51% controlling shareholding in Mycron Steel has witnessed a sharp increase in market price and volume

recently.

“While we cannot be certain that the aforementioned is the cause of MIG’s rise in share price and volume, it does offer a possible connection,” said MIG.

Mycron Steel’s share price has nearly doubled from 45 sen on Sept 1 this year to 88 sen as at market close yesterday, which valued it at RM248.64 million.

Replying to a query from Bursa Malaysia on the unusual market activity, MIG said another possible reason for the rise in its share price and volume is its better financial performance in the fourth quarter ended June 30, 2016 (4QFY16).

MIG reported a net profit of RM8.13 million for the quarter, against a net loss of RM29.55 million for 4QFY15.

It also highlighted the recent revaluation exercise on its land, buildings, plant, machinery and electrical installation as another possible reason behind its recent share price and volume gains.

“The revaluation surplus arising from such revaluation exercise has also been approved by the board to be reflected in the fourth-quarter unaudited results,” it added.

As with Mycron Steel, MIG’s counter had been seeing an uptrend since Sept 1, when it was trading at 33 sen apiece.

The stock closed at 57 sen yesterday, up 72.72% since Sept 1, valuing it at RM128.55 million.

It was the third most actively traded counter, with 40.38 million shares done.