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Are Serba & Sapura’s gravity-defying share prices sustainable?

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Publish date: Wed, 18 May 2022, 02:39 PM

AT a glance, it can be imagined that both Serba Dinamik Holdings Bhd and Sapura Energy Bhd have been blessed with the feline qualities of having nine lives.

By virtue of traded volume, both global integrated oil & gas (O&G) outfits have turned into instant stock market darlings by contributing 2.01 billion shares or 36.5% of the 5.51 billion shares worth RM2.79 bil that were transacted on Bursa Malaysia yesterday (May 17).

On Friday (May 13), the local bourse raked in a volume of 3.17 billion shares valued at RM2.51 bil last.

Yesterday (May 17), Serba Dinamik Holdings Bhd’s never-say-die attitude sent shock wave of great intensity across Bursa Malaysia when the counter hit an intra-day high of 22 sen at 2.40pm – the highest level recorded since the counter re-commenced trading on May 9 after an almost seven-month long suspension.

However, the joy was short-lived with robust profit-taking swiftly ensued which forced the stock to nosedive to 14 sen at 3.33pm before further consolidating to close at 16.5 sen (still up  4.5 sen or 37.5%) amid an eye-popping 1.06 billion shares traded.

Interestingly enough, Serba Dinamik was not alone in scoring what can be deemed as a magnificent revival.

Its sparring partner of late, Sapura Energy Bhd, too, shot up 3 sen or 66.7% to end yesterday’s trading at 7.5 sen after touching an intraday high of 8 sen with 948.56 million shares traded.

Whether the surge in both Serba Dinamik and Sapura Energy is illusionary or sustainable is anyone’s guess so long as the traders/investors are well aware of the risks factors at hand or not to end up catching falling knives at the end of the day.

“The stock sank to a new low of six sen on May 11 which was the third day of resumption of trading,” commented theedgemarkets.com on Serba Dinamik’s performance yesterday. “However, despite the flak and troubles the group faced in the recent months, investors’ interest in the Practice Note 17 (PN17) company still appeared strong.”

However, the most outstanding of Malaysia’s financial portals today listed a few red flags that traders/investors should be wary of:

  • In late April, the group and its three subsidiaries were served with winding-up petitions from six financial institutions that were involved in providing RM1.2 bil in syndicated term financing.
  • The group in its recently announced financial results posted a net loss of RM290.33 mil for its 2Q ended Dec 31, 2021 as revenue further plummeted across key operating segments (net loss for 1Q FY6/2022: -RM42.11 mil).
  • As of end-2021, Serba Dinamik has short-term borrowings of RM1.45 bil plus long-term debts of RM2.27 bil whereas cash and cash equivalents amounted to RM218.95 mil.
  • The company and four of its senior officials including group managing director/CEO and controlling shareholder Datuk Dr Mohd Abdul Karim Abdullah were charged for furnishing false statements. However, they were instead compounded by the Securities Commission (SC) after the Attorney-General’s Chambers (AGC) later decided to withdraw the charges following a letter of representation by the accused.

As for Sapura Energy, suffice to say that whether it is a matter of coincidence or otherwise, its share price seems ‘to be shooting to the stars’ ever since the bailout debate between former premier Datuk Seri Najib Razak and Opposition leader/PKR president Datuk Seri Anwar Ibrahim on May 12.

The truth, however, is that the stock is still deep in the woods after having posted a kitchen-sinking net loss of RM8.9 bil for its financial year ended Jan 31, 2022.

At 10.30am, Serba Dinamik was unchanged at 16.5 sen with 113.7 million shares traded, thus valuing the company at RM615 mil while Sapura Energy was unchanged at 7.5 sen with 236.49 million shares traded, hence giving the company a market capitalisation of RM1.2 bil. – May 18, 2022

https://focusmalaysia.my/are-serba-sapuras-gravity-defying-share-prices-sustainable/

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Be the first to like this. Showing 4 of 4 comments

arv18

Please put down that crack pipe.

16 sen and 7.5 sen respectively is not "gravity defying", but rather "in the longkang".

i am certain these stocks will be able to sustain their longkang prices for awhile!

1 month ago

DickyMe

As long as there are LEMBU to lend a helping hand, these parasitic companies will be kept afloat until the LEMBU runs dry.

1 month ago

stockraider

Base on value & business wise It is worthwhile for the govt to invest in the rescue of sapnrg loh!

But must do it intelligently, we do not want the govt to be taken advantage of with a bad deal loh!

1 month ago

stockraider

For serba, the govt should not do anything as the info of serba falsification is opaque, if the govt involve in the rescue, it will be taken advantage of mah!

Only after doing a through forensic audit to assess the situation....then can assess the situation loh!

Without this done...better let the commercial people liquidate this co loh!

1 month ago

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