Hot Stock Country Heights jumps as much as 18% after well-connected founder made adviser

by **Cals** Mon 10 Feb 2014, 13:27

Hot Stock Country Heights jumps as much as 18% after well-connected founder made adviser

Business & Markets 2014

Written by Jeffrey Tan of theedgemalaysia.com

Monday, 10 February 2014 12:07

KUALA LUMPUR (Feb 10): Country Heights Holdings Bhd (CHHB) rose as much as 18% after its founder Tan Sri Lee Kim Yew returned to the fold of the property firm to lead the group.

Last week, he was made the group’s adviser and is expected to play an active role in the group’s expansion in China and Australia.

Lee is known for his close connection with former Prime Minister Tun Dr Mahathir Mohamad. A brother-in-law of Mahathir was the chairman of Country Heights in the early days of the company. Being a member of the MCA, Lee is also close to the party’s top leaders.

Due to his private investments in China and his leading role in the Malaysia-China Business Council, he has also built up his political connections in the mainland.

At 11.30 am today, the property developer rose 23 sen or 14% to RM1.82. The stock, among the top gainers, saw trades of some 4.5 million shares.

It had earlier hit a high of RM1.88.

“The stock’s entry among the top gainers today could be due to Lee’s return in the capacity as group adviser. Accordingly, the group has outlined plans for expansion,” a dealer told theedgemalaysia.com.

“However, we note Lee’s huge advisory fee is a concern.”

The dealer said CHHB is fundamentally less robust as the group has huge debts in its books. Tan Sri Lee was forced to reduce his role in Country Heights in 2007 mainly due to the debts.

“It remains to be seen if CHHB will continue to be speculative,” the dealer commented, recalling the counter’s speculative nature.

Meanwhile, Kenanga Research in a note said CHHB would see immediate technical support and resistance levels at RM1.47 and RM1.60 respectively.

According to Bloomberg data, year-to-date CHHB has risen 47 sen or 35.88% to RM1.82.

The Edge Financial Daily today reported Lee would lead a new expansion phase of Country Heights, in which the property and leisure group aimed to strengthen its presence overseas, namely in China and Australia.

Last week, CHHB announced to Bursa Malaysia the appointment of Lee as group adviser for two years to advise on the group’s strategic business development, specifically in overseas expansion.

Lee will also remain as non-executive deputy chairman of the group.

Lee has been on the company’s board as non-executive deputy chairman since 2007, after relinquishing the post of managing director in CHHB.