Highlight Stabilising action fails to stem Sunway Construction's below-IPO price dip

by **Cals** Thu 30 Jul 2015, 01:08

Highlight
Stabilising action fails to stem Sunway Construction's below-IPO price dip

KUALA LUMPUR (July 29): Sunway Construction Group Bhd, which was listed yesterday, sank below its RM1.20 initial public offering (IPO) price amid weaker market sentiment and profit taking. The stock fell despite stabilising action on its share price.
At 12.30pm today, Sunway Construction (fundamental: N/A; valuation: N/A) settled lower at RM1.19 with some 16 million shares done. Sunway Construction was the fifth most-actively traded stock on Bursa Malaysia.
At RM1.19, Sunway Construction has market value of RM1.54 billion.
Sunway Construction had earlier declined as much as four sen or 3% to RM1.16. Investors had taken profit after the stock reached an intraday high of RM1.32 yesterday.
Sunway Construction shares fell despite stabilising manager RHB Investment Bank Bhd buying 4.14 million shares at RM1.20 each in Sunway Construction yesterday.
Today, Sunway Construction's share price decline came amid broader market losses. The FBM KLCI fell 0.65 point to settle at 1,699.05 after volatile trade following the Malaysian Cabinet reshuffle.
Remisiers said Sunway Construction could not sustain buying interest as investors began selling the stock yesterday.
“The market sentiment is quite bad and there was already selling yesterday. Investors on a short-term rolling basis will also be selling the shares as the price has dipped below the IPO (initial public offering) price,” a remisier told theedgemarkets.com.
He said the stock price was expected to range between RM1.10 and RM1.30.
SJ Securities Sdn Bhd remisier Goh Kay Chong said selling in Sunway Construction shares would continue until “sellers are depleted”.
Goh said it was difficult to project a support level for the stock as it was a newly listed entity.
“There was a lot of profit taking and it looks like it is continuing today. But investors will have confidence in the stock because they are also looking at Sunway Group ([You must be registered and logged in to see this image.] Financial Dashboard),” he said.
(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.)