What happened to the shares of Crown Berger last Friday was an anomaly that gives a bad impression of the NSE. The company announced an increase in pre-tax profits on Thursday only for their shares to nosedive from Kshs. 38 to Kshs. 8 on Friday, before settling at 19.75, about 48% lower – on a volume of just 10,000 shares.
Still as the running thread of NSE insiders shows, such one-day spike trades have usually on the upper side (Equity, Citi Trust, CFC, to name a few), and don’t merit many complaints, except from skeptics. But if I was a shareholder of Crown (used to be one two years ago), I’d be very upset that 50% of my portfolio in an otherwise sound company has been wiped out in one day. What Crown is going through is no different than any manufacturing company as this time of high oil prices; they have even had mostly good press – expanding regionally, attained Super Brand status recently etc.
There’s a supposed 10% rule on price moves following market information, which is selectively applied. This unusual trade was sloppy or sinister, should never have been allowed.