Hot stock: Khong Guan surges 15.4% after investment announcement

SHARES of K03 jumped as much as 15.4 per cent to reach a one-week high of S$1.57 on Tuesday, after closing at S$1.36 on Monday.

The counter added S$0.13 or 9.56 per cent to S$1.49. About 45,400 shares worth S$70,000 changed hands.

The price movement came after Khong Guan announced on Monday its investment plans in SGProtein, a producer and seller of plant-based meat alternatives. The biscuit manufacturer agreed to buy a 30 per cent stake for S$1.5 million in cash, which will make SGProtein an associated company to Khong Guan.

In a filing to the Singapore Exchange, Khong Guan said: "The proposed investment in SGProtein represents a new and exciting opportunity for growth for the company in Singapore and the region, which are expected to offer a nascent but growing and potentially sizeable market for plant-based food products."

The proposed investment will be funded through internal resources, and is not expected to have any material impact on Khong Guan's net tangible assets and earnings per share for FY2021.