KUALA LUMPUR: Sunzen Biotech Bhd’s shares rose over 8% in early trade Wednesday following its plan to diversify into money-lending business.
The counter added 8.57%, or 1.5 sen to 19 sen with 8.1 million shares done. Sunzen-WB jumped 33.33%, or 0.5 sen to two sen with 27.8 million shares traded.
Sunzen aims to diversify into the money-lending business with the proposed acquisition of the entire equity stake in Finsource Solution Sdn Bhd via a conditional share sale agreement for RM6.8mil.
Sunzen said the acquisition will be satisfied by the allotment and issuance of 41.21 million new ordinary shares in the group at an issue price of 16.5 sen.
The issue price represents its five-day volume weighted average market price on Jan 11, 2021 and takes into account Sunzen’s historical share price.
Meanwhile, PublicInvest Research has a technical buy on the company. It said Sunzen is staging a potential breakout from its current sideways channel.
“Corresponding RSI and MACD indicators remain healthy while trending sideways, with anticipation of continuous improvement in both momentum and trend in the near term.
“Should immediate resistance level of 18.5 sen be broken with renewed buying interest, it may continue to lift price higher to subsequent resistance levels of 19 sen and 20 sen,” the research house said.
However, PublicInvest said failure to hold on to a support level of 16.5 sen may indicate weakness in the share price and hence, a cut-loss signal.