BJCorp- What's up?

Yesterday, BJCorp share price has broken above its ascending triangle formation (see Chart 1). The same was observed for its loan stcok, BJCorp-LC (see Chart 2).

Chart 1: BJCorp's daily chart as at Dec 21


Chart 2: BJCorp-LC's daily chart as at Dec 21

Background

1. Berjaya Corp Sdn Bhd (BJCorp) is the company which undertook the restructuring of BJGroup & it has subsequently assumed the latter's listing status.
2. BJGroup shares, warrants & ICULs were exchanged for BJCorp shares or ICULs on the following basis:
1. 5 shares of BJGroup exchanged for 1 share of BJCorp (par value of RM1.00);
2. 20 warrants of BJGroup exchanged for 1 share of BJCorp; &
3. 3 ICULs of BJGroup exchanged for 2 ICULs of BJCorp (nominal value of RM0.50).
3. Right Issue of 4 BJCorp ICULs for every 5 BJCorp shares held after (2) above. For every ICUL applied for, applicant will get 0.27 free BJCorp ICULs.
4. Repayment of bank borrowings by issuance of 1.46 billion BJCorp ICULs.
5. Settlement inter-company loans (owing to BJ Land & BJ Cap) by issuance of 7.76 billion BJCorp ICULs.
6. Acquisition of Bukit Tinggi Resort for RM802 million by issuance of 802 million of BJCorp shares.

For more information on BJCorp's business activities & financial performance, please refer to its annual report. This can be obtained from the Bursa website.

Recent Development

Some recent developments which may have positive impact on BJCorp share/ICUL price are:

1. The disposal of 56.75% interest in Dunham-Bush for RM180.5 million.
2. Steady buying of BJCorp ICULs by related parties such as Inter-Pacific Securities Sdn Bhd & Berjaya General Insurance Bhd. I've tabulated the purchases for the last 2 weeks below. This buying by related parties accounts for more than 70% of the BJCorp ICULs traded in some days.
   

Table: Acquisition of BJCorp ICULs by related parties from Dec 4-20.

Note: BJCorp ICULs are convertible to BJCorp share at a ratio of 2:1.

Based on bullish technical breakout, I think BJCorp share & ICUL are good for a trading buy. The interest shown by related parties could be a positive indication that this company may have a positive development coming soon. The good entry level for the share is at RM0.22/23 and, for the ICUL, it is at RM0.12.