XiDeLang’s share price plunges another 34%

by **Cals** Fri 24 Jan 2014, 16:23

Business & Markets 2014

Written by Cynthia Blemin of theedgemalaysia.com

Friday, 24 January 2014 09:33

KUALA LUMPUR: Bursa Malaysia-listed China shoemaker XiDeLang Holdings Ltd has seen its share price fall 54% in two days, from 62.5 sen on Tuesday to close at 29 sen yesterday, putting its market capitalisation at RM280.7 million. It fell 15 sen or 34.1% yesterday, with some 77 million shares traded.

The company, without being slapped by Bursa with an “unusual market activity” (UMA) query, had announced that it was not aware of any event or corporate developments that might have contributed to the unusual activity. It was referring to the sharp fall in the share price on Wednesday and yesterday.

“The company has noted that its shares have been heavily traded on Jan 22 and Jan 23, 2014, together with a sharp decline in its share price.

“XiDeLang wishes to confirm that to the best of its knowledge and after making due enquiry with the directors and substantial shareholders seeking their views on the matter, the company is not aware of any event or corporate developments that may have contributed to the unusual market activity,” it said.

The company further said it is not aware of any negative news which may affect its business performance.

It is worth noting that XiDeLang’s 242 million rights shares and 181.5 million bonus shares issued pursuant to the rights issue will be granted for listing with effect from Jan 27. The rights shares were issued at 35 sen each, on the basis of four rights shares together with three free warrants, and three bonus shares for every 12 shares held in the company.

It has been reported that the stock has been active due to speculation of a tie-up with global retail giant Wal-Mart in China.

XiDeLang managing director Ding Peng Peng recently said the company was targeting a double digit growth for its revenue and net profit for the financial year ending Dec 31, 2014.

He was optimistic about the prospects this year, and expects the sports industry in China to pick up in the second half.

Currently, the company is selling 85% of its sports apparels, shoes and related products in China and exports 15% to Europe and the US. There are no sales to Malaysia yet.

XiDeLang has a target segment within the age group of 15 to 35 years and signs on teenage celebrities in China to market its products.

The company exports its products to Europe and the US through its OEM (original equipment manufacturing) operations.

This article first appeared in The Edge Financial Daily, on January 24, 2014.