September 4, 2018 (LBO) – On August 31st, the Colombo Stock Exchange (CSE) has queried listed construction firm MTD Walkers (KAPI) on unusual trading in its shares.
In a response to the CSE which was disclosed on the CSE website, the company responds to the CSE by saying that:
“We write to confirm that the Company has not engaged in any undisclosed price sensitive business activities or transactions to escalate the share price, and do not have any knowledge of the reasons for such an increase in the price of the share and the volume of shares traded as intimated by the Colombo Stock Exchange.”
The stock price of KAPI has doubled, moving from Rs7.5 to Rs15 in the last few days on significant trading volume for the generally illiquid share. Even at 15, the stock is still trading at just half its stated net asset value at the end of the June 2018 quarter.
KAPI has been suffering from sharp losses, and a public relations disaster due to large loan exposures to a state bank where its Executive Deputy Chairman is a Senior Director. This conflict of interest crisis has been coupled with delayed payments by the government causing the firm to endure financial pressures.
Stockbrokers say that there have been rumours that the company is for sale, and speculative trading may be as a result of these.