Johan shares see spike in buying interest

JOHAN Holdings Bhd was the centre of investor attention yesterday when buying interest in the counter spiked up dramatically.

The number of Johan shares traded on Bursa Malaysia yesterday was 19 million shares, about 30 times more than the trading volume of the shares in the previous day.

On Monday, some 650,000 Johan shares exchanged hands. The average 30-day volume of the stock was 3.6 million shares.

The share price rose one sen, or 5.7 per cent, to close at 18.5 sen.

Dealers said they did not know why trading interest in the counter suddenly spiked up.

Johan is the franchisee of Diners Club charge and credit card in Malaysia, Singapore and New Zealand. The company is also involved in the hospitality sector and the retailing and manufacturing of ceramics tiles.

In April, Bursa Malaysia issued an unusual market activity query to Johan following a sharp rise in its share price.

Subsequently, the company announced their plan to dispose of its charge and credit card business in Malaysia and Singapore to a third party.

This move is not surprising given that the charge and credit card business is the most valuable asset for the company.

Together with the hospitality business, this division generates RM178 million of sales a year.

In 2011, its chairman Tan Sri Tan Kay Hock said the group plans to grow its cardholders base to two million from 700,000.

And based on tabulation, it has about 22,000 merchant-in-force throughout Malaysia.

Mastercard and Visa are the two most widely-known card brands in Malaysia and globally, followed by American Express and Diners Club.

Last July, AMMB Holdings Bhd paid RM623 million to acquire MBF Cards from MBf Holdings Bhd.

MBF Cards is the country's largest non-bank-backed credit card issuer.

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