All eyes on MORE shares this week after suspension for irregular trading practices
Investors and traders are keeping an eye on More Return Plc (MORE) after the Stock Exchange of Thailand (SET) suspended trading in the stock until Friday.
On Thursday (November 10), investors were shocked when MORE’s share value hit the floor at 1.95 baht from 2.9 baht a share.
There was plenty of speculation at the time, but the company informed the SET that there was no justification for the steep drop in the stock price.
On Friday, the SET released a statement warning investors to be cautious about MORE as the stock was falling continuously. MORE closed the day at 1.34.
The company said it had suffered a loss of 6.83 million baht in the third quarter of 2022 compared to a net profit of 89.48 million baht in the same period last year. The company recorded a net profit of 22.15 million baht in the first nine months of this year compared to 111.27 million baht in the same period last year.
Over the weekend, there was speculation that a major shareholder may have used a nominee to buy MORE stocks with a margin account (in which the broker/dealer lends the investor cash) of 4.5 billion baht.
This was later confirmed at a press conference on Monday, with the SET and the Association of Securities Companies announcing the suspension.
On Monday, the SET suspended trading in MORE stocks after it noticed irregular trading practices. It also sought help from the Central Investigation Bureau.
The Anti-Money Laundering Office (AMLO) has also launched an investigation into all transactions involving MORE stocks.
On Monday, the company’s largest shareholder, Ummarit Klomchitcharoen, said he had not sold any of the 1.5 billion shares he holds in the company.
However, the fourth largest stakeholder, Apimuk Bamrungwong, told Bangkokbiz that he was shocked when he learned that the team handling his portfolio had bought about 3-billion baht worth of MORE shares.
He said his team had sent purchase orders to 11 brokers and had already paid about 100 million baht.
He said his lawyer would contact AMLO even though the office had not contacted him yet.
On Tuesday, SET announced the suspension of trading until Friday.
Analysis
According to a Bangkokbiz analysis, MORE’s shares were first listed in the SET at 0.3 baht a share after which it peaked at 2.98 baht. However, there were fears of speculation as the company’s performance did not justify the rising share value.
MORE has recorded net losses continuously , except in 2021, when the company booked a net profit of 1.16 billion baht thanks to debt restructuring and the sale of assets.
Bangkokbiz said the value of MORE’s shares had risen gradually until Thursday, when there was a purchase order for about 1.5 billion shares at the opening price of 2.98 baht.
The move raised questions, especially since the shares on Wednesday had closed at 2.78 baht.
Bangkokbiz analysis found the purchase order to be abnormal and questioned who the buyer and seller could be.
The agency speculated that a large shareholder might order one person to open portfolios with almost 20 brokers in a bid to sell for a large amount of money.
Moreover, the stock clearing was scheduled for Monday and brokers would be responsible if the buyer could not pay.
The agency speculated that the objective was likely to use brokers’ money for the stocks, which could have resulted in several brokers going bankrupt if the transaction had gone for clearing.
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