KUALA LUMPUR, May 14 — Pakatan Harapan in its manifesto said it will review all mega-projects in Malaysia and this would have contributed to George Kent (M) Bhd shares plunging as much as 29.95 per cent early this morning.
It hit limit down this morning with the volume of shares traded at 1.6 million.
Sunway University Business School Professor of Economics Dr Yeah Kim Leng said George Kent stock was hit hard in this morning.
“It is not surprising for politically-linked counters especially given the uncertainty brought about by the new government's resolve to review mega infrastructure projects contracted by the previous government,” he told Malay Mail.
Yeah said once there is clarity on the status of ongoing and new projects especially the nature of terms and conditions of contractual agreements, the firm will be able to recover some of the losses.
The public-listed engineering company with core businesses in the metering and engineering industries has been viewed by some analysts as a key proxy for the booming rail project rollouts in Malaysia.
During the year, George Kent secured a tender to supply and deliver 650,000 water meters to the Water Supplies Department (WSD), Hong Kong. This is the second consecutive time the Group has been successful in its bid to supply water meters to WSD.
George Kent has also received a letter of award (LOA) from the Public Works Department (JKR) to design and build a 150-bed hospital in Tanjung Karang, Selangor, for RM277.2 million.
Meanwhile, Johan Holdings Bhd saw it shares decline by 13.3 per cent to RM0.19 at 11.22 am. The volume of shares traded for this stock was also high at 1.6 million shares.
Malton (M) Bhd was also down 13.4 per cent to RM0.68 as at 11.38 am with the volume of shares traded at 3.6 million.
Overall, Yeah added that it will be hard for the government to cancel existing contracts with other concessionaires as well without paying the necessary compensation.
“Only lop-sided contracts may be negotiated that perhaps will result in smaller profits to these concessionaires. This will very much depend on the nature of each agreement signed with the government.”
