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Serba Dinamik, MMC Corporation and Pharmaniaga calls take centre stage

Warrants over Malaysian stocks were the primary driver with RM139.4mil traded, with Serba Dinamik (SERBADK), MMC Corporation (MMCCORP) and Pharmaniaga (PHARMA) being the top 3 popular underlyings last week.
macquarie structured warrants 20200914

As the country enters a 14-day Full Movement Control Order (FMCO) on 1 June, the Malaysia warrants market saw an uptick in trading interest last week, recording a total RM175.2mil turnover which is 71.5% higher week-on-week (w-o-w). Warrants over Malaysian stocks were the primary driver with RM139.4mil traded, with Serba Dinamik (SERBADK), MMC Corporation (MMCCORP) and Pharmaniaga (PHARMA) being the top 3 popular underlyings last week.

There were several eye-catching headlines last week, led by the resumption of trading in SERBADK shares on Monday after two days of suspension on the prior week following the flagging of its external auditors over the company’s financial accounts, followed by Tan Sri Syed Mokhtar’s proposal to bring MMCCORP private via a selective capital reduction (SCR) at RM2 per share last Friday (The Edge Market, 4 Jun). The share price of SERBADK plunged more than 47.5% w-o-w to finish at RM0.765, which is its lowest level since 2017. Call warrants SERBADK-C17 and SERBADK-C25 secured the top and fourth spot on the list with 119.0mil and 86.1mil units traded. On the contrary, the share price of MMCCORP jumped approximately 44.4% w-o-w to close at RM1.69. Since the stock was trading at limit up (RM1.69) throughout the day last Friday, bullish investors switched their focus to MMCCORP call warrants, out of which, MMCCORP-C23 was the most popular call warrant with 89.0mil units traded, followed by MMCCORP-C24 and MCCCORP-C25. 

Besides, more than 67.4mil units of PHARMA-CC exchanged hands last week as PHARMA shares saw a rollercoaster week. On Monday, the share price of the pharmaceutical group limits up (+29.8%) but subsequently reversed its course to finish flat for the week despite news that PHARMA has received a request to supply seven million doses of Sinovac Covid-19 vaccine to government-linked companies and the state government on Tuesday (The Edge Markets, 1 Jun). Lastly, Hang Seng Index (HSI) warrants continued to dominate the index warrants space with investors being more downside biased, which resulted in put warrant HSI-HGN being the second most popular warrant in Malaysia last week.

Top warrants by volume traded:

Warrant nameVolume (mil.)IssuerExercise level/priceExpiry date
SERBADK-C17119.0Maybank1.4830 Nov 2021
HSI-HGN107.1Macquarie28,00029 Jun 2021
MMCCORP-C2389.0RHB1.0027 Aug 2021
SERBADK-C2586.1AmInvestment1.7520 Jan 2022
PHARMA-CC67.4RHB5.8828 Jul 2021

If you have any questions or need further assistance, please do not hesitate to contact us via our hotline at 03-2059 8840 or email us at [email protected]

To view the full list of structured warrants available on Bursa Malaysia, kindly visit malaysiawarrants.com.my

Provided for Malaysian residents information only. This commentary has not been reviewed by the Securities Commission Malaysia. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice. The Warrants will not be offered to any US persons.

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Serba Dinamik Holdings Bhd – 25th Jun 21

The on-going saga that resulted in diminishing of investors’ confidence is expected to see both institutional and retail investors continue to keep their hands off for the time being. Hence, we reiterate our stance to advise investors to steer clear of further position, pending for further clarity from the special independent audit review. Under the prevailing market events, on-going coverage is now impracticable to comply with applicable regulations and hence, we have decided to suspend our coverage on Serba Dinamik. Given the prolonged uncertainties, we have now lowered our valuations metrics and our fair value is RM0.57 (down from RM1.30).

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