Hot Stock Borneo Oil soars 30% on frenzy buying due to rights issue subscription

by **Cals** Wed 14 Oct 2015, 01:50

Hot Stock

[size=28]Borneo Oil soars 30% on frenzy buying due to rights issue subscription

By Sangeetha Amarthalingam / theedgemarkets.com | October 13, 2015 : 12:06 PM MYT

GEORGE TOWN (Oct 13): Borneo Oil Bhd ([You must be registered and logged in to see this image.] Valuation: 0.90, Fundamental: 1.25)'s rights issue subscription last Friday led to frenzied buying, which pushed up its share price by 30% bucking losses among oil and gas counters in morning trade.

At 10.44am, Borneo Oil rose 4.5 sen to 19.5 sen with 21.8 million shares done, for a market capitalisation of RM230.8 million.

Borneo Oil announced on Oct 7 its renounceable rights issue of up to 2.37 billion new ordinary shares of 10 sen each on the basis of six rights shares for every one existing Borneo Oil share held together with up to 1.19 billion free detachable warrants on the basis of one free Warrant C for every two rights shares subscribed for at an issue price of 10 sen per rights issue with warrants would be put up on Friday. The rights shares will commence trading on Oct 19.

Interpacific Securities Sdn Bhd remisier Sam Ng told theedgemarkets.com that the rights issue was impacting the share price as investors are rushing to purchase the shares.

Overall, oil and gas stocks in the FBM KLCI saw marginal dips amidst a slight rise in crude oil futures buoyed by light bargain hunting. US and Brent crude in the previous session posted their biggest daily percentage declines since the start of September, Reuters reported.

At 10.44am, counters such as Perisai Petroleum Teknologi Bhd ([You must be registered and logged in to see this image.] Valuation: 1.70, Fundamental: 0.30) dropped 1.35% or half sen to 36.5 sen, KNM Group Bhd ( Valuation: 1.70, Fundamental: 0.85) lowered by 1.75% or one sen to 56 sen,SapuraKencana Petroleum Bhd ( Valuation: 0.80, Fundamental: 0.65) fell 2.31% or five sen to RM2.11, Uzma Bhd (Valuation: 1.50, Fundamental: 1.10) dipped 1.72% or four sen to RM2.28 and Petra Energy Bhd ( Valuation: 2.00, Fundamental: 1.00) decreased 0.76% or one sen to RM1.30.

At the same time, the local bourse climbed 3.62 points to 1,713.48, extending gains after breaking the 1,700 psychological level.

Meanwhile, Reuters wrote that supply surplus and expectations of higher crude inventory stock piles in the United States limited gains.

Global benchmark Brent crude had climbed 62 cents to US$50.48 a barrel by 0132 GMT, after dropping US$2.79 to end Monday at US$49.86. US crude for November climbed 41 cents to US$47.51 a barrel after settling down US$2.53 at US$47.10, it added.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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