Analysts see curious trade gap between Wilmar, spin-off unit

Wilmar's current market cap of S$28b is half that of its holding in newly listed YKA

Fiona Lam

Published Mon, Oct 19, 2020 · 09:50 PM

Singapore

THE divergent price action between Wilmar International and its newly listed Chinese subsidiary Yihai Kerry Arawana (YKA) was "unjustified", and the two stocks' valuation gap is likely to narrow, analysts said in separate reports recently.

Last Thursday, YKA made a gleaming debut on the Shenzhen bourse by spiking to finish at 56 yuan (S$11.36), more than double its initial public offering (IPO) price of 25.7 yuan. However, this was not reflected in Wilmar's stock price as the counter sank amid heavy volumes traded, ending the day 6.4 per cent lower at S$4.36.

"We think the negative share price reaction could be temporary and the listing of YKA is a long-term…