JAG Berhad (0024)

The article focuses on the potential reversal of JAG's share price in upcoming weeks based on technical analysis. The recent price correction of JAG seems to be distrupted by an unexpected announcement of proposed private placement (PP) of up to 30% of the existing total number of issued shares at RM 0.33 for fund raising purpose. The PP is expected to raise RM 53.14 million.

Upon the PP announcement on 4th June 2021, the price declined to 0.34 area, forming a strong support line. There seems to be an indication for price rebounce, while a few investors wait for the ex-date of PP execution.

Monthly Chart

Daily Chart

While some investors remain sceptical on the occrurance of 'volume pump' prior to the PP announcement, JAG's strong business fundamental and prospects may not support the claim.

Why I think that the PP is something positive for the company earnings despite the dilution of earning?

Lets analyze the breakdown the utilization.

The management is very clear on their intentions and clarifications. It should be noted that the Proposed Private Placement is expected to contribute positively to the earnings of the Group for the financial year ending 31 December 2021 and for the future years.

Copper Price Correction

Copper price is seen to be approaching its support area. The reversal or rebound at this area may be a catalyst for rebound in JAG's price as well. Let us stay watchful.

Remember that , 'The art of winning share trades is to buy when everyone wants to sell it'.

However, the above saying only refers to Grade A companies such as JAG Berhad. How I classify Grade A stocks? Please do read more to understand.

https://klse.i3investor.com/blogs/sujibaby_yongtai/2021-06-17-story-h1566883276-Why_I_prefer_Grade_A_eggs_Sujibaby.jsp

Trade Safe!

Disclaimer: The above analysis is intended solely for informational and educational purpose for peers and, should not be used as a basis for making any specific investment, business or commercial decision. Any decisions to place trades in the financial markets, including trading in stock or options or other financial instruments, is a personal decision that should only be made after thorough research, including a personal risk and financial assessment, and the engagement of professional assistance to the extend one believe its necessary.