Hot Stock Dialog shares extend losses, call warrants decline 29% ahead of expiry

by **Cals** Mon 14 Apr 2014, 17:44

Hot Stock Dialog shares extend losses, call warrants decline 29% ahead of expiry

Business & Markets 2014

Written by Chong Jin Hun of theedgemalaysia.com

Monday, 14 April 2014 14:07

KUALA LUMPUR (Apr 14): Dialog Group Bhd extended losses, falling as much as 6% after the firm said it received an arbitration notice from Tanjung Langsat Port Sdn Bhd (TLP).

TLP claimed that there were breaches in obligation from Dialog’s unit Dialog E&C Sdn Bhd under the engineering, procurement, construction and commissioning contract for an oil terminal at Tanjung Langsat Port, Johor.

At 12.30pm, Dialog settled at RM3.43 with some 9.3 milion shares done. The exchange's ninth-largest decliner had earlier fallen as much as 22 sen to RM3.37.

"The Tanjung Langsat arbitration notice has affected Dialog's share price," a fund manager told theedgemalaysia.com over telephone today.

Last Friday, the stock fell 10 sen or 3% to close at RM3.59.

RHB Research Institute Sdn Bhd wrote in a note that TLP's potential claim at between RM546.6 million and RM561.2 million constituted about 37.5% to 38.6% of Dialog’s equity as of December 31, 2013.

"Pending clarification from the management, we maintain "buy" on Dialog with an SOP (sum-of-parts)-based FV (fair value) of RM3.71," RHB said.

Today, Dialog call warrants (DIALOG-CR) also fell. Bursa Malaysia's 10th-largest decliner at afternoon break dropped as much as 14 sen or 29% to 35 sen with 145,000 units done.

According to Dialog's statement to the exchange, CIMB Bank Bhd had issued the warrants on May 30, 2013.

Today, the decline in the warrants' price came ahead of the instrument's expiry on May 30, 2014.