Gunung Capital Bhd recently announced that it has received award for a service contract amounting to RM165.0m for provision of transportation bus service for the national service trainee program from 26 December 2014 to 25 December 2017.
In less than a month, the Prime Minister announced the temporary suspension of the national service program for 1 year when revising Budget 2015.
Defence Minister tweeted his “guarantee” to National Service stakeholders that the deferment of the government program would not affect the positions of camp operators and trainers. But what about the transportation bus service provider, GUNUNG?
On average, the contract works out to be RM55m a year, which is material considering GUNUNG's annual turnover of about RM80m in recent years.
Shouldn't GUNUNG make an immediate announcement to clarify whether/ how the deferment of national service trainee program affects the financial performance of the group?
According to Bursa listing requirements, a listed company MUST make immediate public disclosure of any material information, if it is reasonably expected to have a material effect on:-
a) the price, value or market activity of any of the listed company; or
b) the decision of a holder of securities of the listed company or an investor in determining his choice of action
Wasn't it the case?
The share price did react to the news and it was widely reported by the media (The Edge, The Star, The Sun, and others).
Timely public disclosure would minimise the possibility of those privy to the details of the contract having an unfair advantage over the public investors.