Tanco slapped with UMA as shares hit fresh highs

by ANIS HAZIM / pic credit: ANNUAL REPORT

TANCO Holdings Bhd’s shares experienced a sharp increase in volatility after the property developer was issued an unusual market activity (UMA) query by Bursa Malaysia Bhd yesterday.

Price action saw Tanco share price jump as much as 31% or 15 sen to a high of 63 sen in early intraday trade, a 22-year high, with some 65 million shares traded.

The UMA notice triggered heavy selling with the shares price collapsing to a low of 34.5 sen in the second half of the trading period before some buying saw the share edged up to close at 39.5 sen, some 17.7% or 8.5 sen lower at close with volumes traded rising to 138.7 million shares, making it the fourth most actively traded counter of the day on the day.

At its closing price, Tanco has a market capitalisation of RM861 million.

Tanco shares have risen from a low of 17 sen on March 21 to a high of 63 sen yesterday on rising volumes without any major material announcements made by the company in the period.

In its bourse filing yesterday, Tanco stated Bursa requested it to disclose any corporate development, rumour or report concerning the business and affairs of the group, and any other possible explanation to account for the UMA.

Tanco in its reply to the UMA, stated it was not aware of any reason for the rise in its share price save for what had been announced earlier.

There have not been any major shareholding changes filed with the exchange save the purchase of 10 million Tanco shares by group MD Datuk Andrew Tan, 41, in early January which took his deemed state holding in the loss making company to 56.35%.

On Jan 25, Tanco’s unit, Tanco Builders Sdn Bhd, won two subcontracts worth RM41.5 million from Sri Medan Holding Sdn Bhd for the East Coast Rail Link project which were scheduled to start on Feb 8. For the second quarter ended Dec 31, 2021 (2Q22), Tanco’s net loss widened 14.57% year-on-year (YoY) to RM2.83 million due to higher administrative expenses.

Revenue for the 2Q22 increased 57% YoY to RM1 million on the back of higher revenue from its construction segment.

In the quarter results filing Tanco noted the group is now much better equipped to formulate, identify, structure and/or seize opportunities than during Covid-19.

“We will continue to innovate and evolve our businesses while constantly reviewing market conditions, seeking interesting and strategic collaborations from prospective partners, investors and operators to explore fresh and innovative business models.

“We will further build up and expand our construction and health supplement sectors to further strengthen our earnings to adapt to this new normal,” it said in its financial report for 2Q22.