TWO former senior employees of UOB Kay Hian Private Limited (UOBKH) were charged on Wednesday for allegedly lying to the Monetary Authority of Singapore (MAS) in relation to reports on a then Catalist aspirant. Lan Kang Ming, 38, and Wee Toon Lee, 34, each face three charges of providing MAS with false information in October 2018 in relation to due diligence reports on an unidentified company applying to list on the Catalist board of the Singapore Exchange. MAS said in a media statement on Wednesday that it was performing an onsite inspection of UOBKH between June and August 2018, to assess the latter's controls, policies and procedures in relation to its role as an issue manager for Initial Public Offering (IPOs). During the examination, Lan and Wee were said to have provided different versions of a due diligence report relating to background checks on a company applying to be listed on the Catalist board of the Singapore Exchange. UOBKH had acted as the issue manager
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Chan Yi Wen
03 March 2015
Sino Construction shares plunged 55.8 per cent on Monday, with S$194 million wiped off its market cap within a single trading session. This comes after the company warned investors last Friday of an expected net loss for FY14 and a month-long extension to its financial results release.
Following the mauling, the mainboard counter closed trading at S$0.117, compared to Friday’s closing price of S$0.265.
With about 11.5 million shares changing hands on Monday, from a total of 1.31 billion shares, the surprise was in the percentage loss, rather than the total traded volume.
Sino Construction’s sole executive director Drew Madacsi, who is also acting as the company’s interim CEO, told The Business Times that he is unfazed by the fresh plunge in share prices. “Today’s volume is tiny, simply a knee-jerk reaction,” he said. “Structurally, nothing in the company has changed. Honestly, I can’t be worried about what the stock is doing on a daily basis.”
He suspects that Monday’s selloff is a reaction to Friday’s profit statement, and added he would start to be concerned if 100 million shares were traded off. Some brokers in the market suspected the selloff was the result of a margin call on some buyers.
In the past few months, Sino Construction’s stock has been holding steadily at about 27-30 cents as it continued diversifying from its traditional construction business, aggressively acquiring coal assets to transform itself into a resource player. In late-January 2015, it also announced its foray into the renewable power generation space.
In fact, since May 2014 to Friday, Sino Construction’s shares had gained about 53 per cent. But those gains were completely reversed with Monday’s selloff.
CEO and executive director of Voyage Research Roger Tan said Friday’s announcement has spooked the market on this counter, considering that its share price has performed quite strongly last year. “When a large number of people are startled and they rush towards a small number of exits, you could have a very disastrous outcome,” he said.
As to whether Sino Construction’s share plunge, on the heels of Friday’s announcement, presents a good entry point for investors to buy into the stock, Mr Tan advised investors to analyse the company’s fundamentals rationally before rushing into it.
He said Sino Construction had to work to communicate its strategy and outlook to the investing community and analysts. “There are too many sceptics in the market. It’s not good for them,” he said.
In response to BT’s queries, Mr Madacsi said Sino Construction remains on track for its power generation business in South Korea and will be hiring a CEO and a chief financial officer at an appropriate time.
BT understands that some brokerages had upgraded the stock to a marginable status - enabling buyers to borrow funds to buy the stock - amid Sino Construction’s recent business developments. But after Monday’s abrupt selloff, they could very well be reviewing this position.