KUALA LUMPUR (Jan 12): Sarawak Cable Bhd’s share price rebounded by up to five sen or 16% to an intra-morning high of 35.5 sen after two straight days of declines, from Tuesday (Jan 9)’s closing price of 41.5 sen.
The counter hit 42.5 sen at the end of Friday’s noon trading session, its highest since Nov 11, 2021.
At the time of writing, the stock had pared its gains to settle three sen or 9.84% higher at 33.5 sen, giving it a market capitalisation of RM133.92 million.
Meanwhile, 41.49 million shares changed hands, making it the third most actively traded stock on Bursa Malaysia.
The decline in Sarawak Cable’s share price on Wednesday (Jan 10) and Thursday (Jan 11) followed its substantial shareholders paring down their stakes.
Its non-independent non-executive chairman Datuk Seri Mahmud Abu Bekir Taib sold five million shares or a 1.25% stake on Monday (Jan 8) for RM1.55 million, or about 31 sen apiece, in a direct transaction, according to Bursa filings. This leaves him with a direct stake of 13.35% and an indirect stake of 6.54%.
Meanwhile, its former non-independent non-executive director Tan Sri H’ng Bok San, via HNG Capital Sdn Bhd, disposed of 1.4 million shares last Friday (Jan 5) and on Monday via the open market, according to a Bursa filing. A back-of-the-envelope calculation shows that he sold the shares for RM580,000, based on the closing prices of 42.5 sen and 41 sen on both days.
Sarawak Cable’s stocks have been rallying since it announced on Dec 12 that it had found white knight Serendib Capital Ltd to undertake a “resuscitation exercise” of the loss-making manufacturer, which involves RM250 million to pare down its debts and recapitalise the company to “to cater to growing customer demand for infrastructure grid development and high-voltage cables”.
However, it did not say if the RM250 million will be given as a loan or an equity injection.
As at Aug 31, 2023, Sarawak Cable’s current liabilities stood at RM388.75 million, with 84% of that being secured loans. Meanwhile, long-term debts amounted to RM11.67 million.
On the other hand, its cash balance, excluding overdraft and deposits pledged, was at RM19.42 million.
The company was also sitting on accumulated losses of RM296.42 million as at end August last year, which had resulted in a negative shareholder equity of RM76.6 million.