Dr Shi Xu, executive chairman of Nanofilm Technologies International, has increased his stake in the company. On Oct 14, Shi acquired 200,000 shares for $741,580 or $3.70 each. Back in July, Nanofilm had traded at a recent peak of $6.67.
With this transaction, Shi’s total interest in the company increased to just over 356 million shares or 54.09% from 54.06%. His interest comprises a direct stake of nearly 44.5 million shares or 6.75% as well as a deemed stake of nearly 311.6 million shares or 47.34%.
Shi bought the shares on the same day the company gave an interim update in between its 2Q and final-year earnings. Nanofilm, the hottest IPO last year, gave investors a rude shock in August after announcing earnings for 1HFY2021 ended June 30 had dropped by 3.1%, compared to the continuing growth trajectory analysts were expecting.
Investors were also spooked by the resignation of the company’s CEO Lee Liang Huang and COO Ricky Tan Chong Ho in quick succession. Following Lee’s resignation, Shi doubled up as interim CEO and on Oct 14, the company announced that deputy CEO and chief commercial officer Gary Ho will be appointed as group CEO with effect from Jan 1, 2022.
The company, which provides nano-coating services to electronics and automotive parts makers, attributed the drop to a couple of one-off reasons. It had incurred higher than usual power costs in its new production facility in China and revenue growth was crimped after customers did not put in as many orders with Nanofilm as expected because of supply chain issues caused by the shortage of components elsewhere.
In the Oct 14 interim update, the company said that the traditional peak of the third quarter might be pushed to the fourth quarter and possibly even the first quarter of next year instead. This has prompted analysts to trim their target prices. UOB Kay Hian’s John Cheong, for example, has a new target price of $3.90 from $4 previously; DBS Group Research’s Lim Kee Ling now sees the stock worth $4.05, down from $4.18 previously.
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The company maintains that it has a healthy demand pipeline. It is also moving into new markets. On Oct 1, Nanofilm said it has completed the formation of a joint venture company Sydrogen with Temasek Holdings. The new entity, tapping on resources and capabilities from both parties, has set its sights on the growing hydrogen market.
Temasek is not merely a joint venture partner. It is a key Nanofilm investor as well. On Sept 24, the company announced that via a married deal, Shi sold nearly 6.6 million shares worth about $27 million or around $4.12 each to Temasek. The state investment agency, already a substantial shareholder of Nanofilm, therefore has a total stake of 7.22% in Nanofilm, up from 6.22% previously.
Power couple raises their stake in construction company
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Gordon and Celine Tang, the husband-wife team who are the largest shareholders of Chip Eng Seng Corp, have increased their stake in the company. On Oct 12, they acquired 1.17 million shares for $490,980 or 42 cents each.
This increased their stake to nearly 292.1 million shares or 37.28% from 37.13% previously. As at June 30, Chip Eng Seng’s net asset value per share was 101.31 cents, down slightly from 103.38 cents as at Dec 30, 2020. Celine heads the company’s board as its non-executive chairman.
On Sept 29, the company announced that its subsidiary CES Engineering & Construction has been appointed by the government as the replacement main contractor for the remaining construction works of a housing estate at Marsiling Grove in Woodlands.
The company did not disclose the contract value, although it noted that the contract is not expected to have any material impact on its net tangible assets and earnings per share of the company for the current fiscal year ending December 31.
For its 1HFY2021 ended June 30, the company reported earnings of $99,000, reversing from a loss of $24.4 million a year ago. Revenue in the same period more than doubled to $419.1 million.
