Mudajaya Group Bhd, whose shares have come under selling pressure in recent days on news reports of it being investigated by the Securities Commission (SC), has seen RM415.35 million erased from its market capitalisation.
Mudajaya tumbled another 48 sen to RM5.09 yesterday. Before the negative news, the share price had rallied from only RM1.72 on July 29 last year to a 52-week high of RM6.10 on July 22.
Its market capitalisation was reduced to RM2.09 billion from RM2.51 billion on July 22 when the share price was at RM6.10. It is currently trading at a price-to-earnings of 13.34 times.
The selldown was sparked by a news report that the SC was probing the affairs of Mudajaya following a complaint it had received from an undisclosed party. The company responded to Bursa Malaysia on Monday that it was unaware of the nature of complaint nor it source.
“The board of Mudajaya assures that the company operations are done in accordance with all statutory requirements and comply with all listing regulations. The company is more than willing to extend its full cooperation to the SC, if queried,” it said.
Market speculation had it that the complaint may have stemmed from the company’s independent power producing project in India, with some analysts noting the company had exceptionally high margins compared with its bigger peers.
This article appeared in The Edge Financial Daily, July 29, 2010.
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