Tuesday, 27 October 2015

Stock Review – AJIYA (7609) - 3 (AJIYA BERHAD)


image source from Big Chart Marketplace

image source from Big Chart Marketplace
Bursa Malaysia - 7609
Bloomberg - AJY:MK
Yahoo - 7609 .kl
Webpage - http://www.ajiya.com/


Reason the stock price drop

The main reason the AJIYA had start dropping today is because of yesterday and today announcement of the private placement. The private placement at the peak of the price will definitely benefit the company because they can have more share premium.

The private placing to an unknown investor is a huge uncertainty. Investors that bought the share at below RM 3.00 might start to take profit from it. This unknown investor will become one of the major shareholders of the company and it might influence the operation of the company in the future.
With the current economy and might be worst next year, an expansion plan shall be on hold but AJIYA is announcing for private placement for expansion.

PROS:

  • Private placement at the peak will benefit the company

CONS:

  • Private placement to an unknown investor.
  • The unknown investor will become the major shareholder.
  • The uncertainty of the world economy is not the best time for expansion.