Far Eastern New Century Hits Limit Down After MSCI Exclusion; Firm Asserts Fundamentals are Strong

Following the May MSCI quarterly adjustment, Far Eastern New Century (FENC) was removed from the MSCI Global Standard Index for Taiwan. This triggered a sell-off by institutional investors, causing the stock to plummet for two consecutive days and hit the daily limit down today. FENC explained that the stock volatility is primarily due to the MSCI adjustment and emphasized that the company's fundamentals remain sound. FENC's stock closed down NT$2.6 at NT$23.45, a six-year low. The company warned that selling pressure might continue this week until the adjustment takes effect on May 29. However, FENC plans to provide further details on its outlook at the annual general meeting on May 29. FENC's Q1 revenue was NT$61.298 billion, down 3.8% year-on-year, but net profit attributable to the parent company rose 32.6% to NT$3.092 billion, the highest in seven quarters. The company expressed confidence in its Q2 performance as crude oil and raw material prices stabilize.