Hot Stock SYF Resources jumps to 10-year high

by **Cals** Wed 06 Jan 2016, 22:26

Hot Stock

[size=28]SYF Resources jumps to 10-year high

By Kamarul Anwar / theedgemarkets.com | January 6, 2016 : 3:44 PM MYT

KUALA LUMPUR (Jan 6): SYF Resources Bhd ([You must be registered and logged in to see this image.] Valuation: 1.10, Fundamental: 1.10) reached a 10-year high of 68 sen today, continuing its upward climb since the furniture maker and property developer announced its latest quarter's profit had doubled to RM10.83 million.

Sources familiar with the company said research houses have begun speaking to SYF Resources' management, with one research outfit preparing a note on the company soon.

At 3.15pm, SYF Resources eased to 67.5 sen, up 4.5 sen or 7.14%, after some 13.57 million shares changed hands, and was the 18th most active stock across the bourse.

Since Dec 1, 2015, the counter has jumped by 40.21% from 48.5 sen. SYF Resources' stock has not garnered a price as high as today's since the intraday high of 91.2 sen on May 31, 2006.

Once a sleepy counter with trades of less than one million shares a day, demand for SYF Resources multiplied after Dec 16, 2015, the day it released its financial results for the first quarter ending July 31, 2016 (1QFY16).

SYF Resources' trade volume hit its highest in a year on Dec 21, 2015 — the day The Edge Financial Daily published an interview with SYF Resources executive director Datuk Seri Chee Hong Leong.

In the interview, Chee said SYF Resources can easily achieve a double-digit net profit growth in FY16, with its property division outperforming the sector.

"It's not that we are better than everybody [other property developers]. It just so happens [that] we have the land bank and opportunity to work with some land owners in Bandar Sungai Long and Semenyih (Selangor), where the demand for housing is consistently there," Chee told daily in the interview.

For 1QFY16, 51.04% of SYF Resources' pre-tax profit of RM13.02 million came from its property development segment.

Its developments are focused in the Cheras-Kajang-Semenyih area, with the land banks held by a privately held company Kiara Susila Sdn Bhd, owned by Chee and SYF Resources' executive chairman and chief executive officer Datuk Seri Ng Ah Chai.

SYF Resources' warrant SYF-WB has also been shooting up in tandem with its mother share. The derivative jumped by three sen or 12% at 3.15pm to 28 sen.

At the current price, SYF-WB is trading at a 45.19% premium to its mother share — after computing its strike price of 70 sen and its one-for-one conversion ratio.

The warrant still has about four years of shelf life, as it will expire on Dec 11, 2019.

(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.)
[/size]