KUALA LUMPUR: Shares of Supermax Corp Bhd
tumbled 9% in early trade following the conviction of managing director Datuk Seri Stanley Thai for insider trading.
The glovemaker saw its shares fell 9.09%, or 19 sen to RM1.90 with over seven million shares traded. Supermx-C29 plunged 50%, or four sen to 4 sen while Supermx-C27 eased 43.75%, or 3.5 sen to 4.5 sen. All the three counters dominated the most heavily lists’ on Bursa Malaysia.
In a media statement on Friday, the Securities Commission (SC) said that the Kuala Lumpur Sessions Court convicted the former managing director of APL Industries Bhd (APLI) along with former remisier Tiong Kiong Choon on Friday for insider trading offences.
In Thai's case, he is appealing against the conviction.
As for Tiong, he got five years’ jail and a RM10mil fine.
Meanwhile, Supermax said the court has granted a stay of execution and an appeal has been filed against the conviction and sentence of Thai.
The group said it is business as usual for Supermax and that its management team is committed to delivering good business performance and profitability in the interest of the
company and its shareholders.
CIMB Research has downgraded the glove maker from Add to Hold following the negative surprise about the conviction.
The research house has lowered the 12-month target price from RM2.46 to RM2.03 which is 12 times CY19 price-to-earnings. Its last traded price was RM2.09.
CIMB believes that investors will be apprehensive in investing in Supermax at this juncture with the current negative newsflow.
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