Is the Gautrain powering Murray & Roberts?
The mystery of the construction group’s 34% share price jump may be revealed on Friday, a possible reason may be news of an expansion of the Gauteng network
Something of a mystery on the JSE on Thursday was what made construction group Murray & Roberts’s share price rocket 34%?
Both the volume and value of Murray & Roberts shares traded was unusually high. JSE data showed nearly 96-million Murray & Roberts shares traded, whereas in the past few months its daily average has been about 500,000 shares traded. The value of shares traded was about R1.4bn whereas this rarely went over R10m in the past few months.
One possible reason for the jump in Murray & Roberts’s share price was news of a proposed R79bn expansion of the Gautrain network. Murray & Roberts is part of the Bombela consortium that owns this railway.
Gauteng human settlements MEC Paul Mashatile told a conference in Sandton on Tuesday that a feasibility study looking at expanding the Gautrain system was under way.
Murray & Roberts’s surge came on the same day Gautrain announced it had suffered a derailment near its Hatfield terminal, and was forced to carry passengers by bus to Pretoria station.
A day before the spike, Murray & Roberts released a trading update saying it expected to report on February 22 that its diluted headline earnings per share (HEPS) from continuing operations declined by up to 75%. Including discontinued operations, it warned shareholders it might report a headline loss per share, and at best break-even.
Murray & Roberts issued a statement on Friday morning saying it had noted the unusually high trading volumes of its shares.
"The company is not currently aware of anything that could have led to this unusual market activity. The identities and/or intentions of the acquirer(s) of Murray & Roberts’ shares are not known to the company and will not be known unless the acquirer either approaches the company directly or is required to notify the Company in terms of section 122 of the Companies Act. The company has not yet been notified by any sellers of Murray & Roberts’ shares who may be required to do so in terms of section 122 of the Companies Act."
Markets trading ahead of the JSE’s opening on Friday generally took their cue from Wall Street and Europe whose indices closed lower on Thursday.
The gloomy mood in global stock markets was blamed on traders growing impatient with US President Donald Trump. No details of Trump’s promised "phenomenal" tax breaks for business have yet been forthcoming.
The rand was trading slightly under R13/$ on Friday morning, clinging on to its gains since strengthening to R12.90/$ on Wednesday.