Tuesday, July 26, 2011

MMHE slides to May 30 low

KUALA LUMPUR: Malaysia Marine and Heavy Engineering Bhd (MMHE) shares slid to the lowest since May 30 as investors took profit on the company which has a stellar run-up since its listing in October last year.

At 3.57pm, it was down 30 sen to RM7.69 with 1.98 million shares done while the CC call warrants fell 11 sen to RM1.03.

The FBM KLCI edged up 1.84 points to 1,561.44. Turnover was 768.01 million shares valued at RM1.02 billion. There were 284 gainers, 364 losers and 315 stocks unchanged.

MMHE was listed on Oct 29 and its institutional offer price of RM3.80 while the retail price was RM3.61.

The share price's run-up in the past few months was underpinned by the proposed acquisition of Sime Darby's fabrication yard, and its inclusion in the KLCI and the MSCI Malaysia Index.

Analysts said although Sime Darby's fabrication yard acquisition nearly doubled MMHE's annual capacity, it will only be fully available to MMHE in the second half of 2013 as Sime Darby utilised a portion of the yard to complete its ongoing project.

This saw some analysts downgrading the stock to underperform due to the then expensive valuations.

A foreign research house had on July 4 said its target price of RM7.15 then implied a 14% potential downside.

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