PM 2.5 A Blessing or Curse for PHOL?
PM 2.5 had made PHOL's shares to rise incredibly fast, but it also gave negativity to the share as well when SET put PHOL on cash balance.
The PM 2.5 (Particulate Matter 2.5) that went off the chart and hovered above the Metropolitan Bangkok and perimeter for weeks may be a positive matter for Phol Dhanya Public Company Limited (PHOL) as people started to raise concern to their health by frantically searching for the now out-of-stock N95 mask.
It may be just only a short-term gain that gives PHOL to turn crisis into opportunity from a huge amount of orders for N95 mask, but the income from these orders is believed to be only a small ratio comparing to the bottom-line gain.
This particle pollution not only boosts PHOL’s short-term sales, but also boost its shares as well. Sudden hikes in PHOL’s shares could be seen on January 15, 2019 that closed at ฿1.98/share, gained ฿0.38 or 23.75% with ฿86.77 million in value, then on January 30, 2019 that closed at ฿2.06/share, increased ฿0.29 or 16.38% with ฿103.98 million. It was not like the usual PHOL that normally closed the day with only ฿10 thousand or above in value.
However, a new crisis had shown itself to limit the upward direction of PHOL’s price when SET put PHOL under cash balance on level 1 market surveillance criteria as trading value and the price does not correspond with the fundamental factors, effectively from January 31 to February 20, which caused the shares to slide 8.25% to close at ฿1.89/share on February with ฿8.14 million in value.
The cash balance had made both new investors and speculators stuck at the price higher than ฿2.00/share with a lower trading volume.
Those who had hiked too high, especially a total of 1,402 individual investors, might need to wait on the lifting of cash balance and see if the share would perform the same way as it used to.
Nevertheless, PHOL still has a baggage of ฿71.37 million deficit and ฿401.54 million debt. When compared to only ฿267.42 million of shareholder equity ratio, PHOL will have D/E at 1.50x which reflects a risk in a long-term investment.
PM 2.5 might have done a good job on raising PHOL’s share price for only a short period of time, but it also brought PHOL a new crisis to aggravate the company that has not yet been able to settle its years-long deficit.
If PHOL cannot get back on its feet as soon as possible, the trading and share price may not be as lively as it had been in the last couple of days.