For the past 2 days, the downfall of share price for SCIB (9237) alongside some other companies had indeed spooked investors.

Now, how should investors act next?

Looking at the fundamentals of SCIB, the company had already turned profitable in their latest financial quarter, with a revenue of RM39.4 million and PAT of RM0.9 million, as compared to over RM23.0 million in accumulated losses back in FYE2023 ended June.

If you look at the past announcements by the company, the new management team has done their best to “refurbish” the company, which includes the termination of legacy contracts that are not profitable, or that are lacking in terms of progress.

For example, a job for building houses for civil servants from Awana JV Suria Saga (AJVS) has been terminated by SCIB, of which the advances made to AJVS amounted to RM18.7 million will be repaid to SCIB in the form of debt.

And if we are looking at Q1FY24 results, SCIB had reported that the company had an order book balance amounted to RM257.2 million, which we could expect this substantial order book to sustain for another 2 financial years for the company.

Just on 16th Jan 2024, SCIB had secured another EPCC contract from Landasan Kapital (M) for a RM97.7 million on top of the order book size we just mentioned. What went wrong with the company?

Fundamentally speaking, the new management is doing their job for sure. But given how quickly SCIB turns around, there could be 3rd party syndicates that accumulate their shares.Or it could be the domino effect caused by the drop in share price for another 3 companies that belong to the same owner.

Nevertheless, the directors have not sold their shares. Now that the market is in full blown panic mode, perhaps this might be a good opportunity for us as investors to accumulate the shares of the new SCIB.

Only time shall tell if this is an opportunity, or a crisis.

Keep a neutral stance for now.