Regulatory Actions By SGX::Mirach Energy will remain on the MTP Watch-List due to Trade With Caution alerts by SGX RegCo

Issuer & Securities

Issuer/ Manager
Stapled Security

Announcement Details

Announcement Title
Regulatory Actions By SGX
Date &Time of Broadcast
03-Dec-2019 19:06:26
Announcement Sub Title
Mirach Energy will remain on the MTP Watch-List due to Trade With Caution alerts by SGX RegCo
Announcement Reference
Submitted By (Co./ Ind. Name)
Listing Compliance
Singapore Exchange Regulation
Effective Date and Time of the event
03/12/2019 00:00:00
Description (Please provide a detailed description of the event in the box below)
Mirach Energy Limited (the Company) was placed on the Watch-List (MTP Entry Criteria) (MTP Watch-List) on 5 June 2017. Accordingly, the Company has to meet the MTP Exit Criteria pursuant to Rule 1314(2) by recording a volume-weighted average price (VWAP) of at least $0.20 and an average daily market capitalization of S$40 million or more over the last 6 months.

As at 2 December 2019, based on trading information over the past 6 months, the average market capitalisation of the Company is S$46.3 million and its average VWAP is S$0.2120. This means that theoretically, the Company would have been able to exit the MTP Watch-List.

However, SGX RegCo would like to point out that on 24 September 2019 and 5 November 2019, we had issued two Trade with Caution (TWC) alerts on trading in the shares of the Company.

SGX RegCo noted that the share price of the Company had climbed steadily from $0.130 on 8 February 2019 to $0.290 on 3 September 2019, an increase of $0.160 or 123%. In particular, between 29 April 2019 and 15 May 2019, when the STI declined 188.25 points or 5.53%, the closing price of the shares rose from $0.163 to $0.197, an increase of $0.034 or 21%.

Our review of the trades between 8 February 2019 and 3 September 2019 showed that a small group of individuals was responsible for over 69% of the buy volume. These individuals appear to be connected to each other.

Consequently, the market capitalisation of the Company increased approximately $18 million to reach $44.5 million on 20 September 2019 from 8 February 2019.

SGX RegCo also noted that a single omnibus trading account accounted for 88.7% of the buy volume between 7 October 2019 and 5 November 2019, and 4 individual trading accounts were behind the omnibus trading account.

In view of the issue of the TWCs and the unusual activities in the shares of the Company which have resulted in what appears to be artificial valuations, we do not consider the Company to have met the requirements for removal from the MTP Watch-List. SGX RegCo will ignore any artificial distortions to share prices which are not representative of true market demand. Accordingly, the Company will remain on the MTP Watch-List.