$SALCON / 8567 (SALCON BERHAD): Warrant Trading at a Discount

Salcon's share price has surged over 100% from last year, largely due to $BJCORP / 3395 (BERJAYA CORPORATION BERHAD) emerging as a significant shareholder. According to the latest announcement, Berjaya now holds a 17.718% stake, making it the largest shareholder of the company. Salcon specializes in providing end-to-end water and wastewater solutions, including raw water management, design, construction, commissioning, concession, operation, and maintenance of water and wastewater treatment facilities. This also includes downstream activities such as non-revenue water reduction, customer service, billing, and collection. Berjaya's increasing stake in Salcon may be driven by the rising demand for water from data centers.

The rising share price has resulted in the warrant trading at a discount. With a warrant price of RM0.10, a strike value of RM0.30, and a 1:1 ratio, the warrant is trading at a 3.61% discount compared to the current share price of RM0.415. This presents an opportunity for major shareholders to sell the mother shares, purchase warrants, and convert them back to mother shares to potentially earn a 3.61% profit, excluding fees. However, it is important to note that the conversion of warrants takes a week, and if the share price drops suddenly during this period, the premium could disappear, potentially leading to losses.