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Hot stock: Best World counter's 6% jump in early trading prompts SGX query
SHARES in Best World International were on a tear in Thursday's early session, gaining 6 per cent within the first hour of trading.
The rise in the skincare maker and distributor's stock price prompted the Singapore Exchange (SGX) to issue a query citing its unusual price movement.
The counter entered the SGX's midday break at S$2.97, a gain of 17 Singapore cents or 6.1 per cent, on a volume of 3.22 million shares. The value of the trades in the early session stood at S$9.48 million.
Best World, which is due to report its earnings for fiscal 2018 after the market closes on Feb 26, reported S$29.9 million in net profit for the third quarter in November, close to two and a half times more than earnings from the same period a year earlier. Since posting Q3 results, Best World's stock price has gained some 60 per cent.
The earnings jump was boosted mostly from new revenue in China, where it has moved away from an export business model to a franchise one.
Under the export business model, Best World sells its products to export agents at a discounted bulk price. Meanwhile, under the franchise model, franchisees such as beauty salons and spa operators convert their stores or open new premises as Best World Experience Centres to sell exclusively the group's products.
In a phone interview with The Business Times in December, Best World chief operating officer Huang Ban Chin said that its current model "allows greater control over development in China".
He also said that the company is making positive progress in other key markets of operations.
In January, Best World invested in A*Star spin-off Celligenics, which is involved in stem cell research and development, in a bid to leverage synergies with its business in the health and wellness sector.