Baswell Resources

Yeah, they say news and speculation could drive a stock up but stometimes it makes you wonder when a stock moves before some negative news is released.

Take this stock called Baswell Resources.

Here is the daily stock chart.

Quite hard to make any conclusion from the above chart except that there was one massive surge in January.

Which of course was driven by 'news'... can you say power to the mighty sword from our so-called financial journalist?

• Takeover on the cards at Baswell?
  Written by Jose Barrock
  Tuesday, 19 January 2010 12:03
  
  KUALA LUMPUR: Baswell Resources Bhd’s shares hit their 52-week high of 67.5 sen yesterday, before tapering off to end the day at 58 sen, which marks a 4.5 sen gain from last Friday’s close.
  
  The stock’s closing price is also its highest level since March 2006.
  
  Also, trading volume on Baswell was unusually heavy yesterday, with some 15.68 million shares changing hands, representing almost a third of Baswell’s 48 million-share base. This trend of heavy trading volume started last Friday, when some 4.86 million shares were transacted in the tightly held counter.
  
  Although not certain as yet, a takeover could be on the cards at Baswell.
  
  According to shareholding changes filings via Bursa Malaysia Securities, an individual Ng Min Lin emerged as a substantial shareholder in Baswell, after acquiring a direct interest of 5% or 2.4 million shares. According to filings, he had made the acquisition on Dec 24 last year.
  
  Ng upped his stake to 23% or 11.04 million shares after buying two tranches of 4.32 million shares each for a total of 8.64 million shares on Dec 31 last year and Jan 5 this year. Bursa announcements yesterday, however, showed that Ng had since pared down his stake to 21.9 million shares.
  
  Pursuant to the filings, Ng could have acquired his stake from Dr Oh Han Cheng or Dr Oh’s spouse Khoo Yew Kheng, who have been trimming their stake in the furniture company.
  
  Oh is the founder of Baswell, and its executive chairman, while Khoo is Baswell’s managing director. Khoo’s brother Khoo Yew Nean is an executive director of the furniture maker.
  
  According to Baswell’s latest annual report for FY2008, the trio collectively control some 52% of Baswell. The only other substantial shareholder in the company is Wan Ismail Wan Nik who has 10.52 million shares or 21.91% of Baswell.
  
  Two board appointments were also made last Friday. Tan Beng Kheng, who is the managing director of Penang-based Seng Seng Construction Sdn Bhd, and Ng’s father- in-law, Datuk Wong Kam Hoong, were appointed to the board in non-executive positions. Wong was formerly deputy minister of culture, arts and heritage.
  
  A check with the Companies Commission of Malaysia reveals that Seng Seng Construction is controlled by privately held Tan Kiew Seng Holdings Sdn Bhd, and Tan is a director of Seng Seng Construction.
  
  Seng Seng Construction suffered a net loss of RM1.9 million on RM38 million in revenue for its financial year ended June 2008.
  
  
  This article appeared in The Edge Financial Daily, January 19, 2010.

Makes you wonder... why... and how come... our journalist DARE to publish news when they dare to admit that it's not even certain! Doh!

See. The writer dared to say "Although not certain as yet, a takeover could be on the cards at Baswell." Bottom line, there's no concrete proof, yes? It's all uncertain! Why publish news that are not certain? Doesn't this makes our financial news look silly?

Which was followed by this article...

• Baswell seals RM336m subcontract for Abu Dhabi project
  Written by Financial Daily
  Thursday, 21 January 2010 10:53
  
  KUALA LUMPUR: Baswell Resources Bhd, which has been the subject of intense investor attention over the past few days, has bagged a US$100 million (RM336 million) subcontract from Hong Kong-based project management and building material sourcing company Metroplex Resources Ltd for a mixed development project in Abu Dhabi.
  
  Baswell has signed a memorandum of understanding (MoU) with Metroplex to entirely manufacture and install the furniture and fittings of the development.
  
  The Edge Financial Daily reported yesterday that market talk over the last few days had it that a Middle Eastern job was on the cards for the local furniture maker. Investor interest in the stock had also heightened that substantial shareholding changes could prompt a takeover situation.
  
  In an announcement to Bursa Malaysia yesterday, Baswell said it would collaborate with Metroplex and the Al-Amry Group to design, build and install a project for the Al Reem Island mixed development.
  
  “The MoU is consistent with Baswell’s market development plans as the company intends to enter into various collaborative agreements with other parties to enhance its international furniture manufacturing status,” said the company.
  
  Baswell shares were unchanged yesterday, closing at 76 sen per share with 9.92 million shares traded.
  
  The company’s share price had soared on heavy trading volume since last Friday. Nearly 24 million shares were traded, and the stock has seen a surge of 114% in its share price since the beginning of the year.
  
  Changes in substantial shareholdings fuelled speculation that a takeover was on the cards, a rumour that was promptly quashed by Baswell’s board of directors who said the announcements on substantial shareholding changes had been misconstrued.
  
  Baswell has seen the emergence of new substantial shareholder, Ng Min Lin, who owns 21.86% of the company. The largest shareholder in Baswell is Wan Ismail Wan Nik, who holds a 21.96% stake.
  
  
  This article appeared in The Edge Financial Daily, January 21, 2010.
  

LOL! The Edge Financial should had at least owned up the takeover speculation and rumour was given a massive helping hand by its own 'journalist', yes?

Anyway, this is not what the posting is all about.

This is Baswell's 5 minute charts.

Hmmm... two sudden spikes .... followed by increase in volume after the spike. Would this be the classical "pump up to dump"?

On Saturday, there was this news on Baswell.

• Saturday March 13, 2010
  
  Baswell plans capital reduction
  
  PETALING JAYA: Furniture maker Baswell Resources Bhd has proposed a 55% capital reduction under a plan to eliminate the group’s accumulated losses and facilitate future fund raising exercises, the company told Bursa Malaysia.
  
  The capital reduction means its issued and paid-up capital would be reduced from RM48mil, comprising 48 million shares of RM1 each, to RM21.6mil comprising 48 million shares of 45 sen each.

Hmmm... makes you wonder, doesn't it?

Did those 2 spikes happen because of the capital reduction issue?

And needless to say, Baswell is currently trading down on huge volume. At one moment of time, the stock was trading as low as 29 sen, down 9 sen from Friday's closing of 38 sen!