Hot Stock China Stationery falls 35% after Bursa rejects extension plea

by **Cals** Wed 02 Jul 2014, 23:10

Hot Stock China Stationery falls 35% after Bursa rejects extension plea

Business & Markets 2014

Written by Jeffrey Tan of theedgemalaysia.com

Wednesday, 02 July 2014 11:12

KUALA LUMPUR (July 2): China Stationery Ltd (CSL) fell as much as 35% after Bursa Malaysia rejected its request for more time to submit its 2013 audited financial statements.

Yesterday, the China-based company announced the stock exchange rejected CSL’s application for a further extension of one month to July 31, 2014 from the extended deadline.

CSL was given five market days to issue its reports failing which Bursa would impose a trading suspension of its shares effective July 9, 2014.

At 10.45 am today, CSL lost 2.5 sen or 21.7% to 9 sen. The most active counter saw trades of some 49.6 million shares. It had earlier fallen to a low of 8.5 sen.

A dealer told theedgemalaysia.com: “CSL’s decline today is definitely due to Bursa’s rejection of its application for extension.”

Meanwhile, InterPacific Securities’ remisier Sam Ng questioned the company's inability to produce the audited financial statements.

“Where is the integrity of corporate governance on listed companies such as CSL?” he said over the telephone.

Given CSL's net tangible asset of RM1.27, price earnings ratio of 0.5 time and positive net cash of RM1.27 billion, Ng was puzzled why the company was unable to produce the statements.

On Monday, CSL had sought for additional time for its auditors to finalise the audited financial statements following a fire incident that occurred at its plant in Fujian Province, China in April this year.

Earlier, Bursa had approved an extension of two months, which was from May 1 until June 30 this year.

According to CSL, the fire incident had necessitated additional disclosures by its board of directors in the audited consolidated financial statements, and by Messrs RT LLP in the auditors’ report.

Both of these will take some time to complete, it claimed.