KUALA LUMPUR (Sept 26): The stocks of two companies controlled by the Chiau Family — Chin Hin Group Bhd (KL:CHINHIN) and Chin Hin Group Property Bhd (KL:CHGP) — were among Bursa Malaysia's top losers on Thursday, continuing their slide that started from earlier this month.
Chin Hin, which ranked second on the local stock market's losers list of the day, fell by as much as 40 sen or 16.39%, reaching an intraday low of RM2.04. This triggered a temporary suspension of intraday short selling (IDSS) for the stock for the rest of the day.
The stock, which was thinly traded, later pared some losses to close at RM2.07, still down by 37 sen or 15.16%, after about 4.78 million shares were done. At RM2.07, Chin Hin's market capitalisation stood at RM7.33 billion.
Chin Hin has experienced a sharp sell-off since the beginning of the month, plunging RM1.29 or 38.4% from a high of RM3.36 on Sept 4. Nevertheless, the stock remains up 17.2% year-to-date.
CHGP, a 62.3%-owned subsidiary of Chin Hin, was the 10th biggest loser on the bourse on the same day, dropping 12 sen or 5.88% to RM1.92, after just 411,200 shares were traded. The company's market capitalisation was RM1.27 billion.
The drop came after the stock surged 130% from 83.5 sen on Dec 29 last year and reached a high of RM3.07 on May 14.
Chin Hin is controlled by its founder Datuk Seri Chiau Beng Teik, who holds a direct 22.4% stake and an indirect 37.78% through the family’s private vehicle, Divine Inventions Sdn Bhd. His son, Haw Choon, has a direct shareholding of 5.75%.
Notably, three other stocks related to Chin Hin Group — Fiamma Holdings Bhd (KL:FIAMMA), Ajiya Bhd (KL:AJIYA), and Signature International Bhd (KL:SIGN) — also faced selling pressure on Thursday.
Signature International, a kitchen cabinet manufacturer and 71.7%-owned subsidiary of Chin Hin, slipped four sen or 3.2% to RM1.21, giving it a market capitalisation of RM781.05 million. Year-to-date, the stock is up 45.4%.
Fiamma, which distributes electrical home appliances, dipped two sen or 1.75% to settle at RM1.12, valuing it at RM593.85 million. Fiamma is 22.63%-owned by Signature International, giving Chin Hin an effective stake of some 16.22% in Fiamma. The counter has risen by 19.1% since the start of the year.
Ajiya, 53.6%-owned by Chin Hin, also fell by four sen or 2.82% to RM1.38, giving it a market capitalisation of RM420.3 million. Year-to-date, the stock has fallen by 10.9%.
It is unclear what is driving these stocks down. However, it is worth noting that both Chin Hin and CHGP were among several stocks that the Human Resource Development Corporation (HRD Corp) had invested in, as reported by The Edge Malaysia weekly in the July 15–21 edition.
At the time, HRD Corp had come under scrutiny following a Public Accounts Committee (PAC) inquiry into the government agency’s investment portfolio and asset purchases.
Chin Hin posted a net profit of RM42 million for the second quarter ended June 30, 2024 (2QFY2024), up 92% from RM21.9 million a year earlier, driven by strong contributions from Ajiya and Signature International. Revenue surged 55% to RM774 million from RM500.6 million.
As of end-June this year, Chin Hin's cash and bank balances stood at RM278.9 million, compared to total borrowings of RM1.71 billion.
For CHGP, its profit for 2QFY2024 more than doubled to RM12.5 million from RM5.8 million in 2QFY2023, as revenue rose 12.4% to RM178.4 million from RM158.7 million.
Ajiya, which changed its financial year end from Nov 30 to Dec 31, returned to profitability for the three months ended May 31 with a net profit of RM16.8 million on a revenue of RM87.9 million.
Signature International, on the other hand, saw its net profit for the second quarter ended June 30, 2024 halving to RM10.4 million from RM20.7 million, as revenue dropped 14.5% to RM203.4 million from RM237.6 million.
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Companies HRD Corp has invested in