Naturally, this set tongues wagging that its all for naught. Really... is this our first rodeo??? Many big projects are awarded to private companies or joint ventures because it is easier to sort out details without revealing too much to the market. Subsequently, they usually will be injected into linked listed companies just based on the nature of project and capital requirements.
You cannot expect market investors to ignore such news because both companies are tightly controlled by LKH. A stock market is a forward discounting machinery. Judging from the longevity of the project and the massive capital requirements, and the fact that he has already listed companies in the correct sector - it would take an idiot to surmise that he won't inject into these two companies.
Surely Ekovest would be the lead player followed by IWCity. Remember when LKH got the same project before being unceremoniously taken away by you-know-who ... it was supposed to be injected into IWCity but the insufficient profits there made fundraising a problem. Hence this time around, it is likely that Ekovest would be the lead company.
IWH in the jv owns 60% of the project and would need to pay its share of the RM500m = RM300m. Ekovest has a warrant expiring June 2019 which should bring in RM150m. Thus making the fundraising relatively easy. To do something else (e.g. keep the jv private; use another listed vehicle, etc..) would be multiple times more onerous.
Nonetheless, it is likely that some selling pressure may occur tomorrow but I expect the whole thing to rebound swiftly. (p/s I hereby declare I have zero holdings in both companies or its warrants). Buyers will have to grit their teeth and brace for the volatility.
Reading comments from i3 would lead me to conclude that there are too many newbies in the markets, or less than sophisticated investors. There is no need to jump and be startled on the news. It shouldn't be your first rodeo.
p/s this is just my opinion and not a recommendation to sell or buy
KUALA LUMPUR: Iskandar Waterfront City Bhd
, two listed firms controlled by Tan Sri Lim Kang Hoo, have issued separate statements to Bursa Malaysia to clarify that they are not involved in the revived Bandar Malaysia project.
The statements came after shares in the two companies jumped to their maximum allowable daily limit on Monday.
Both companies, in similar statements, told the exchange today that they were not aware of the reason behind the recent surge in their share prices. They advise investors to exercise caution in the trading of their shares.
"Save for the press release issued by the Prime Minister's Office (PMO) on April 19 entitled "Government to Restate Bandar Malaysia Project", in which the name of our sister company, IWH-CREC Sdn Bhd was mentioned, the company wishes to clarify that IWCity is not involved in the reinstatement of the Bandar Malaysia project," IWCity said.
Investors on Monday chased up counters linked to Lim on high hopes that his companies would benefit from the revived Bandar Malaysia project.
Read more at https://www.thestar.com.my/business/business-news/2019/04/22/iwcity-ekovest-say-not-involved-in-reinstated-bandar-malaysia-projec/#5pVD8rbMsmd7Phka.99
77huat77
Not only newbie. Many sozai make 20 % profit gonna run. Hahah
2019-04-23 10:00