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SGX RegCo urges caution in trading of China Haida shares

Stanislaus Jude Chan
Stanislaus Jude Chan • 2 min read
SGX RegCo urges caution in trading of China Haida shares
A review of the trading activity has revealed that a “significant portion” of the total traded volume over a 3-week period has been generated by a “small group of market participants”.
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SINGAPORE (Jan 7): Singapore Exchange Regulation (SGX RegCo) has urged investors to exercise caution when dealing in the shares of China Haida.

The market regulator noted that Haida, the China-based aluminium panels manufacturer formerly known as Comat Industrial, has seen unusual trading volume and share price movements since Dec 16, 2019.

While China Haida only had three active trading days over the past three months before that, with a total traded volume of 576,000 shares, the on-market volume of its shares surged to 4.01 million shares on Dec 16.

On that same day, its share price rocketed 150% to close at 1 cent, from its last traded price of 0.4 cent.

SGX RegCo noted that between then and Jan 6 this year, China Haida’s volume traded and share price had “remained high”.

The counter has seen a daily average of 1.72 million shares trading during the period, with its share price hovering at around 1.1 cents.

However, the market regulator’s review of the trading activity has revealed that a “significant portion” of the total traded volume over this 3-week period has been generated by a “small group of market participants”.

“We are reviewing the trades in [China Haida] shares and will take the necessary actions including referring the case to statutory authorities where warranted,” SGX RegCo said in the surveillance notice on Tuesday.

Further, SGX RegCo noted that China Haida had released an announcement regarding a revision to the terms of its right issue on Dec 17, 2019 – a day after the start of the unusual trading activity.

In June last year, China Haida had proposed a rights issue of up to 2.04 billion new shares at an issue price of 0.2 cent for each rights share, on a basis of eight rights shares for each existing ordinary share on the company.

This was in conjunction with a proposed transfer to the catalist board of the SGX.

China Haida on Dec 17 revised the principal terms of the rights issue. Instead of eight rights shares, the company said entitled shareholders would instead get seven rights shares for every one existing share.

The company on Dec 2 last year had also made another application to SGX for an extension to exit the minimum trading price (MTP) watchlist, which the company has been placed on since Dec 2, 2016.

However, the group said it has since been informed by SGX that there is a moratorium being placed on companies currently on the MTP watchlist due to ongoing public consultation.

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