PetChem, which soared as much as 105% from its pre-war price, tumbled as much as RM1.19 or 20% to RM4.69 in early trading. The stock pared some of its losses to settle at RM5.64 or 4.1% lower at the mid-day break, valuing the group at RM45.12 billion.
The sharp drop also led to a suspension of short selling in the stock for the rest of the day, with short selling set to resume tomorrow. PetChem is the chemical arm of national oil company Petroliam Nasional Bhd (Petronas).
The shares of Hibiscus, which had risen as much as 54% from its pre-war price, fell nearly 15% or 32 sen to RM1.87 before clawing back to RM1.94, or 11.4% lower, at the mid-day break.
At this price, Malaysia’s first independent oil and gas exploration and production company is valued at RM1.43 billion.
Founded in 2007 and listed in 2011, Hibiscus operates assets like North Sabah and Anasuria in the North Sea, producing about 26,500 barrels of oil equivalent per day.
Both these companies had benefitted from surging oil prices following the outbreak of the conflict and the de facto blockade of the Strait of Hormuz by Iran.
Oil slid the most in almost six years and stocks surged after the US and Iran agreed to the ceasefire, giving markets a temporary respite.
West Texas Intermediate (WTI) crude tumbled as much as 19% and Brent slid as much as 16% after US president Donald Trump suspended bombings on Iran, a move that will help resume oil flows through the strait. Iran said safe passage through the chokepoint will be possible during that period.
At the time of writing, WTI crude was trading at US$95.43 while Brent was at US$93.85.
The ceasefire deal buys time for the two sides to reach a longer agreement to end the war, which has killed thousands of people and sparked a global energy crisis.
Trump’s decision is a dramatic climb-down from a shocking social media post yesterday, in which he warned “a whole civilisation will die tonight” if Iran didn’t give in to the US’ demands.
Analysts previously said PetChem was a prime beneficiary of the Iran crisis as it gets its feedstock supplies from within Malaysia rather than the Middle East, where deliveries have ground to a virtual halt.
The group operates 21 manufacturing sites and 54 production plants globally with a capacity of 16.8 million metric tonnes per annum.
Despite the sharp drop in its share price, MBSB Research kept its recommendation on PetChem unchanged. The research house recently upgraded its call to “buy” from “neutral”, with a revised target price of RM6.60 from RM3.01 previously.