Sembcorp Marine does not not know why shares surged on Wednesday
On Wednesday, 21.3 million shares changed hands, prompting an SGX query
Sembcorp Marine told the regulator yesterday that it did not know why its shares surged amid heavy trading on Wednesday afternoon.
It said in a filing before the market opened that it was unaware of any information not previously announced that might explain the trading activity.
SembMarine noted that it "negotiates contracts with its customers" in its ordinary course of business, and "there is no certainty that any transaction will materialise".
The mainboard-listed company said it will issue announcements if it wins contracts.
It also noted there have been "various reports in the media and rating updates by stockbroking firms recently" that might have an impact on the share price, although it did not give further details.
The filing came after the Singapore Exchange queried the offshore and marine firm about Wednesday's trading activity.
The counter had hovered around $1.41 for most of Wednesday before climbing to $1.495 shortly after 4pm with almost six million shares traded.
It reached an intra-day high of $1.53 minutes before the market closed and ended at $1.51, up 7.86 per cent or 11 cents.
A total of 21.3 million shares changed hands, making it one of the most active stocks on the bourse.
The SGX flagged "unusual price movements" at 4.37pm, asking if the company knew of any possible explanation for the trading.
ACTIVITY
This prompted yesterday's statement that it did not know what was behind the heightened activity.
SembMarine's latest bourse filing before the one made yesterday came on July 8, when it released a statement on the ongoing bribery investigations in Brazil.
It said it had lodged a suspicious transaction report with the Commercial Affairs Department here.
It had earlier revealed that its yard in Brazil had been raided and its former president was involved in a corruption probe.
DBS Equity Research made a "buy" call on SembMarine with a $2.40 target price on July 3, after the company gave the update on the Brazil yard raid.
OCBC Investment Research maintained its "hold" call on July 3, with a lower fair value estimate of $1.50, down from $1.60.
The research team said: "Without clarity on Brazil... we have been reluctant to recommend a 'buy' on the stock, though there have been trading opportunities with short time frames in the past".
SembMarine shares closed down 1.32 per cent at $1.49 yesterday. - THE STRAITS TIMES
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