The sudden fall wiped out more than half-a-billion ringgit from the property developer’s market capitalisation.
PETALING JAYA: Shares of Tanco Holdings Bhd
slumped by more than 16% in early trading yesterday and triggered regulatory thresholds, prompting Bursa Malaysia to suspend intra-day short selling (IDSS) for the counter.
The sudden fall wiped out more than half-a-billion ringgit from the property developer’s market capitalisation.
But even after yesterday’s drop, Tanco’s valuation remained elevated at a trailing price-earnings multiple of 372 times.
The stock exchange operator said the IDSS suspension was temporarily lifted after the Tanco stock’s last done price fell by over 15% or 15 sen from the reference price.
The stock hit an intra-day low of 78.5 sen from the previous day’s closing price of 94 sen. Later, however, it pared some losses and closed at 85 sen yesterday.
“The short selling will only be activated the following trading day, Wednesday, Nov 5, at 08:30am,” Bursa Malaysia said yesterday.
Tanco, which is also in the midst of building a “smart artificial intelligence container port”, has been trading at eye-watering valuations despite its modest fundamentals.
The company is valued at RM5.2bil, even though its total assets stood at only RM516.3mil as of end-June.
For its financial year ended June 30, Tanco’s net profit fell by 33.8% year-on-year to RM7.9mil.
Revenue also declined by 26% y-o-y to RM128.5mil.
Tanco attributed the lower profits to weaker revenue generated from construction and installation as well as property development.
“Most revenue from the East Coast Rail Link contracts had been recognised in the previous financial year, as those projects approached completion.
“Additionally, property development revenue was recognised from the completion of hotel serviced suites upon obtaining the Certificate of Completion and Compliance,” it said.
