Thursday, July 3, 2014

Jaya Holdings (J10) - Stock That Puzzling Me!

While reading through the online market related articles, one of the following article headline caught my eyes : "Shares of Singapore’s Jaya Holdings jump 20%". After pursuing the article and other online resources related to Jaya Holdings (J10), I have more questions than answers. 

OK! Following are some facts that I've gathered and my associated doubts:


1. The company official website has been replaced with a statement like this : "The disposal of all of Jaya Holdings Limited’s subsidiaries to Mermaid Marine Australia was completed on 4 June 2014". At the time of my writing, the stock is still actively traded with high volume. My doubt : Does it means that Jaya Holdings is going to be delisted from the SGX from 4 June 2014 onward? If no (i.e. we can still trade the Jaya stock in future), how do we evaluate it? 

2. From an article of The Edge (click here to view), It indicated that the last traded stock price of $0.043 is a level unseen in more than six years. My doubt : why 6 years? I've checked the stock chart of Jaya Holdings, for the past 12 years (2002 to 2014), the stock prices ranged from the low of $0.14 to the high of $1.99), so shouldn't this the lowest level EVER? Or did I missed something? 

3. I know the Dividend of $0.16 Per Share is Ex-Date on 2nd Jul 2014 and hence the share price has "dropped" from $0.19 (on 1st Jul) to $0.04 (on 2nd Jul). My doubt : To me, it is a logical drop (due to the dividend payout), then why the same article indicated that it is a 20% jump? Again, maybe I've missed out something!?   

Sorry, as I am still a newbie, I might be asking something that might deemed very obvious to many of your folks. If you are familiar with this stock, do enlighten me.

Cheers!

4 comments:

  1. For point 1, I think that the stock will continue trading, it just disposed of its assets and did not get taken over.

    For point 2, I think the edge adjusted the price for dividends.

    For point 3, when the stock falls to 4 cents, even a 1 cent gain would lead to a ‘20% jump in share price’ . This is quite common as traders and arbitrages move in to trade the stock as it adjusts to the new pricing.

    This is as the market is unsure what the ‘true value’ of Jaya be after dishing out its dividends (This is as Jaya probably disposed at a profit, and kept some of it instead of dishing it all out, which explains why the stock is at 4 cents and not 0.19 (before xd) -0.16 (dividends dished out) = 3 cents
    Furthermore, the low price allows traders to move in larger volumes which explains the record turnover.

    ReplyDelete
    Replies
    1. Hi LiewXun thanks for clearing all my doubts! ;-)

      Delete
  2. Replies
    1. Cw8888 Are you still involved in the excitement ? ;-)

      Delete

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