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KUALA LUMPUR (Oct 1): Yesterday there was a liquidation of penny shares, some of which are companies that have recently proposed or completed rights issues, private placements or employee stock option (ESOS) schemes, and Bursa Malaysia registered a total of 216 accountants with prices lower than 50 sin each registered decreases compared to 65 winners.
Roughly 15% of these declines saw declines of more than 10% as trading hours ended, with Dolphin International Bhd recording the steepest 23.8% drop from 10.5 sen to close at eight sen, followed by Nexgram Holdings Bhd (down 22.2%), TFP Solutions Bhd (down 21.9%), Key Alliance Bhd (down 20%) and SC Estate Builder Bhd (down 20%).
Among the counters priced below 30 sen / share, there were 150 declines, of which 29 fell more than 10%, compared to just 33 winners.
The declines in penny stocks were in line with the fall of the FBM Small Cap Index, which sank 96.75 points or 0.75% to close at 12,835.21 points. In contrast, the FBM KLCI gained 0.92 points or 0.06% to settle at 1,504.82.
Some of those who decline have recently announced rights issues, which likely affected their share price.
Dolphin International, for example, will see the trading of some 305.25 million shares with rights today (October 1), exceeding its current share base of 244.2 million shares, with 198.1 million warrants.
The company announced the issuance of rights with warrants on February 27 of this year to raise up to RM24.7 million, of which RM9.8 million would go towards the purchase of six million shares in Asia Poly Food and Beverage Sdn Bhd ( AP F&B). The stake purchase is part of Dolphin International’s move to diversify its operations in the food and beverage segment. Currently, the company is dedicated to the sale and design of pneumatic, hydraulic and software systems for the palm oil milling sector.
Over the past two weeks, Dolphin International has fallen 42.9% from its close of 14 sen on Sept. 15. So far this year, it has fallen 13.5%.
TFP Solutions, which is down 37% since mid-September, just completed its rights issue, with 227.41 million shares with rights and 227.41 million warrants listed on the exchange yesterday. Before the issue, its share base was 227.41 million shares. TFP Solutions made the cash call to raise money for working capital for its fintech mobile product business, as well as other opportunities in ICT and fintech.
Key Alliance, which has fallen 37% since its 9.5 sen close on Sept. 15, proposed a rights issue nearly three weeks ago on Sept. 11. The exercise that was unanimously approved by its shareholders on Monday (September 28) aims to increase between RM5 million and RM58.9 million, with most of the proceeds going to the diversification proposed by the IT company in the trade in medical equipment.
Meanwhile, Lambo Group Bhd, which yesterday fell 16.7% to 2.5 sen, has just completed the final tranche of its 30% private placement on September 18, while Priceworth International Bhd, which also fell 16 , 7% at 2.5 sen, recently set the issue price. for his 10% private placement.
Other penny stocks that were in the top 20 declines that have rights issues, private placements or ESOS schemes in the works, or have executed warrants, are DGB Asia Bhd (16.7% down), Ho Wah Genting Bhd (16.2% down) , Fintec Global Bhd (decrease of 15%) and Inix Technologies Bhd (decrease of 14.9%).
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