A-Rank Bhd (-ve)

SHARES in aluminium billet manufacturer A-Rank Bhd (fundamental: 2.4/3, valuation: 2.4/3) closed three sen or 3.66% higher at 85 sen yesterday after a total of 189,200 shares crossed, following the company’s announcement of a business diversification on the same day. Trading in the stock triggered our momentum algorithm for the second time this year.

A-Rank is proposing to diversify its business to include property development, in view of the intense market competition faced by its existing aluminium business. It said the new business may contribute 25% or more of the group’s net profits.

As initial investment, A-Rank said it aims to collaborate with an experienced joint-venture partner to reduce risks.

The group has also proposed a bonus issue of up to 51.45 million new shares, on the basis of two bonus shares for every five existing shares held by entitled shareholders, at an entitlement date to be announced later.