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Hot stock: Silkroad Nickel shares up 14% up after married trade deal
SHARES in Indonesian nickel mining group Silkroad Nickel were on a tear in Wednesday's early session, surging 31.4 per cent to trade at a near two-month high at 9.19am when it traded at 46 Singapore cents. As at 1.35pm, its stock was trading up five Singapore cents or 14.3 per cent at 40 Singapore cents on a turnover of about 1.51 million shares.
The surge in the stock's price came as a married trade of about 1.48 million shares was made at 9.13am at 45 Singapore cents apiece.
The usually thinly traded Silkroad Nickel debuted on the Singapore Exchange's Catalist board on July 30, 2018 via the reverse takeover of suspended cash company China Bearing (Singapore) by Singapore-incorporated Far East Mining's wholly owned subsidiary, FE Resources.
Based in Indonesia, the group has the mining business licence to carry out nickel ore mining operations in Sulawesi, Indonesia.
Last month, its subsidiary signed a new offtake agreement estimated to be worth more than S$400 million to supply 15 million tonnes of nickel ore over a period of five to eight years to PT Transon Bumindo Resources. Days prior to the agreement, the company and its two executive directors were named defendants in a writ of summons by four Malaysian-based lawyers who were involved in the reverse takeover of the company by FE Resources.
The nickel miner noted that the claim by the plaintiffs on the consideration shares, if successful, would not result in a change in control of the company as Far East Mining will remain the single largest controlling shareholder.
Silkroad Nickel posted revenue for the third quarter ended Sept 30, 2018 of US$1.4 million, a US$0.8 million or 37.5 per cent fall from the US$2.2 million posted in the year ago period. This was due mainly to the decrease in the quantity of nickel ore sold due to the group conserving nickel ore stocks in anticipation of getting the export quota licence for export market sales.