KUALA LUMPUR (May 2): Shares of Ge-Shen Corp Bhd rose as much as 14.91% to a new record high of RM4.47 on Thursday, following the emergence of Chin Hin Group’s Chiau family as its second largest shareholder.
At 5pm, shares of the plastic injection moulding and metal stamping company stood at RM4.19, still up 30 sen or 7.71%, with 584,300 shares traded — not far from its 65-day average daily volume of 635,180 shares.
The rise follows news that Chin Hin Group-linked Chiau Haw Loon and Chiau Haw Yew acquired an 18.31% stake in the company on April 29.
The 23 million shares were bought at RM30.36 million or RM1.32 apiece from Ge-Shen’s managing director Chan Choong Kong. The acquisition price of RM1.32 is at a 65% discount to Ge-Shen shares’ closing price of RM3.78 on April 29.
Ge-Shen's share price averaged RM1.34 last year, and traded between RM1.10 and RM1.59 in the period. A run-up that started in January accelerated in the last two months.
In March, the group said it was not aware of any reason for the rally, in response to queries from Bursa Securities. The counter has gained 269% this year.
Chan, via Pelita Niagamas Sdn Bhd, held as much as 63.39% in Ge-Shen as at March last year. Pelita Niagamas pared down its stake — including to Frazel Group Sdn Bhd, which currently holds a 29.59% stake in the company.
Frazel Group was recently in the news after its RM59.58 million deal to acquire a plot of land from YNH Property Bhd was called off. This was because YNH decided to rope in Chin Hin Group Property Bhd to develop the land instead.
In return for the development rights, Chin Hin Property will pay RM52 million to YNH.
YNH has said it intends to use RM24 million of the proceeds to repay Frazel Group's deposit due to the cancellation of the land sale.
Frazel Group is linked to Datuk Keh Chuan Seng, who is also the largest shareholder of Tex Cycle Technology (M) Bhd, where Chiau Haw Yew is executive director.
At RM4.19, Ge-Shen trades at a trailing price-to-earnings ratio of 62.7 times. Its market capitalisation stood at RM526.95 million.