Three Dr Yu-linked counters top Bursa's losers list

Industrial mould manufacturer Rapid Synergy tops the losers list on the local stock market after dropping RM1.42 or 5.7% to close at RM23.40, giving it a market capitalisation of RM2.5 billion. The decline came after the stock reached a record high of RM29.50 on Dec 22, before falling by 21% to its closing price on Tuesday.

Property developer YNH, on the other hand, was the third largest loser after declining 36 sen or 9.8% to RM3.30, valuing it at RM1.75 billion.

The stock has fallen 34% since Dec 1, after hovering around RM5 for about half a year since May last year, when it hit a record high of RM5.20.

Three Dr Yu-linked counters top Bursa’s losers list

Unlike Rapid Synergy and YNH, in which Kuan Chon is the largest shareholder controlling 22.8% and 32.6% respectively, he owns a smaller stake in Imaspro — an agrochemicals and pest control-related products manufacturer.

Kuan Chon holds 14.6% of Imaspro as its second largest shareholder, after managing director Tong Chin Hen’s 51% shareholdings.

Imaspro was Bursa Malaysia’s fifth largest loser on Tuesday, after falling 16 sen or 4.4% to RM3.48, giving it a market capitalisation of RM278.4 million.

Imaspro’s downtrend can be traced back to mid-November, when the counter was trading at RM5.59. It has since fallen 38%.

It is unclear what is driving these stocks down, but it is worth noting that all three counters have gone on a rather steep climb since early 2022. [See charts]

Attempts to reach Kuan Chon for comment were not successful at press time.

His elder brother and alternate director Datuk Yu Kuan Huat, meanwhile, owns a nearly 4% stake in Rapid Synergy. Kuan Huat is also a managing director of YNH Property, with a direct 4.48% stake and an indirect 24.86%.

Rapid Synergy, YNH in the spotlight recently

Both Rapid Synergy and YNH have made headlines recently for the wrong reasons, as they were slapped with qualified opinions from their respective external auditors in the third quarter of last year.

In October, Baker Tilly Monteiro Heng issued a qualified opinion on YNH’s financial statements for its 18 months ended June 30, 2023 (FPE2023), in relation to its joint venture (JV) and turnkey contracts for property development works.

Then on Nov 7, YNH’s three-member audit committee expressed its intention to appoint a professional firm for an independent review. But less than a month later, the audit committee’s chairman Oon Seow Ling and Baker Tilly informed the board that they would not be seeking re-election in the annual general meeting (AGM) in December.

Over at Rapid Synergy, KPMG had flagged in November that its financial statements for FPE2023 provided insufficient disclosures and evidence over a RM4.43 million rental income, a RM2.32 million gain from the disposal of property, and deposits paid for the acquisition of properties.

Later that same month, Rapid Synergy’s shareholders voted against the reappointment of KPMG as the group’s auditor. On Monday, Rapid Synergy announced Morison LC PLT as its new external auditor.

Earnings-wise, Rapid Synergy’s net profit has been trending down over the past three years. It made a net profit of RM1.74 million for the 18 months ended June 30, 2023 (FY2023), much lower than the annual net profits of RM3.46 million for FY2021 and RM5.2 million for FY2020 despite the expanded financial period due to the group’s change in financial year-end to June 30 from Dec 31. It kicked off its FY2024 with a net profit of RM13.85 million for the three months ended Sept 30, 2023, boosted by a gain from the disposal of investment properties.

Similarly, YNH has changed its financial year end from Dec 31, to June 30. The loss-making company posted an annual net loss of RM2.79 million in FY2021, which swelled to RM14.59 million in FY2022 and further to RM18.23 million in the 18-months ended June 30, 2023 (FY2023). For the first quarter of FY2024, YNH remained in the red with its net loss for the July-September months widening to RM10.22 million from RM2.22 million a year before, despite revenue rising 19% to RM62.74 million from RM52.84 million. The quarterly performance was dragged by higher cost of sales, expenses and lower other income.

In contrast, Imaspro’s earnings have been relatively stable over the years. It made an annual net profit of RM1.82 million in FY2021, RM2.19 million for FY2022 and RM1.8 1 million for FY2023. For its first quarter ended Sept 30, 2023 (1QFY2024), Imaspro posted a net profit of RM2.08 million, up 34% from RM1.55 million previously, as revenue grew 13% to RM14.41 million from RM12.78 million.

Frankly Speaking: Why the lack of urgency?

Frankly Speaking: Be mindful of red flags

Imaspro hits record high but only 2,900 shares change hands

YNH’s auditor issues qualified opinion on financial statements in relation to JV, turnkey contracts

Rapid Synergy’s auditor raises red flags over FPE2023 accounts