"In summary, Eng buyout offer of RM 2.50 could potentially adjusted downward by 35sen to RM 2.15, that is after take into account fully year write off earning of 20.6m + 22m assets impairment, equivalent to 35sen per share."
hng, can the offeror just change his offer price lower after he ahs already made the offer public? what is stopping him from withdraw the offer?
Increase further stake of malton, bought more Malton at 58sen. I'm expecting Malton to declare dividend during its upcoming AGM.
Compared to last year dividend of 1.5sen against its earning of 6.3sen (payout ratio 24%). Assuming Malton adopt more conservative dividend payout of 20%, it could potential declare dividend of 4sen or yield of 6.7%.
The major shareholder of Eng have seek further extension of 45day mainly to assess to impact of flood condition in Thailand.
It can revise its offer price and re-send for Eng Board approval again before table for EGM.
I think the revise price is justifiable based on Eng current condition: loss of business opportunity cost + full year write-off earning + impairment of its equipment + plant machine
hng, with this kind of 'takeover' popular these days with pacmas & leader as well, would the system not be open to abuse ie offeror make offer to boost price and then lower the price or just withdraw the offer? thanks for sharing.
Whatever the reason, one must carefully evaluate the intrinsic value of company: fundamental factors such as: balance sheet; cash holding; free cash flow; earning growth; NTA etc.
For the takeover to get through, offeror have to gain support from banker; board approval and EGM. Retail investor also can assess whether there is change in stake holding of major shareholder after the proposed takeover.
In Eng case, its audited NTA is 2.22, which is just 10% discount than original offer price of 2.50. In addition Eng record consistent positive earning over decade and in fact in net cash position of 20sen/share. Therefore it is justifiable for the offeror to be serious about takeover.
Since you're concern about Eng, let share some more information about its current situation. Market has sent Eng competitor JCY to skyrocket high yesterday in a hope that JCY which plant have not suffer flood should enjoy higher demand of its product and possible at higher margin due to shortage HDD to meet year end PC mega sale.
JCY has since increase production around clock to meet extraordinary demand. Similarly, Eng local plant which account for 60% production also increase production to meet shortfall from its Thailand plant. These couple with potential higher selling price + higher volume + recent weakening RM = better profit margin could at least mitigate adverse effect suffer from its Thailand production line.
17 comments:
Just within 3min, i've sold off all Huayang at 1.65-1.66, realize very handsome paper profit
Bought JCY at 59-59.5sen, to ride its strong volume and potential beneficial to gain higher HDD market share
Just sold off JCY at 60.5sen, realize quick intraday gain :)
"In summary, Eng buyout offer of RM 2.50 could potentially adjusted downward by 35sen to RM 2.15, that is after take into account fully year write off earning of 20.6m + 22m assets impairment, equivalent to 35sen per share."
hng, can the offeror just change his offer price lower after he ahs already made the offer public? what is stopping him from withdraw the offer?
Increase further stake of malton, bought more Malton at 58sen. I'm expecting Malton to declare dividend during its upcoming AGM.
Compared to last year dividend of 1.5sen against its earning of 6.3sen (payout ratio 24%). Assuming Malton adopt more conservative dividend payout of 20%, it could potential declare dividend of 4sen or yield of 6.7%.
ccdev
The major shareholder of Eng have seek further extension of 45day mainly to assess to impact of flood condition in Thailand.
It can revise its offer price and re-send for Eng Board approval again before table for EGM.
I think the revise price is justifiable based on Eng current condition: loss of business opportunity cost + full year write-off earning + impairment of its equipment + plant machine
Buyback some Huayang at 1.61.
hng, with this kind of 'takeover' popular these days with pacmas & leader as well, would the system not be open to abuse ie offeror make offer to boost price and then lower the price or just withdraw the offer? thanks for sharing.
Sold back all Huayang at 1.64-1.65
ccdev
Whatever the reason, one must carefully evaluate the intrinsic value of company: fundamental factors such as: balance sheet; cash holding; free cash flow; earning growth; NTA etc.
For the takeover to get through, offeror have to gain support from banker; board approval and EGM. Retail investor also can assess whether there is change in stake holding of major shareholder after the proposed takeover.
In Eng case, its audited NTA is 2.22, which is just 10% discount than original offer price of 2.50. In addition Eng record consistent positive earning over decade and in fact in net cash position of 20sen/share. Therefore it is justifiable for the offeror to be serious about takeover.
Bought more malton at 57.5sen
Bought Eng at 1.56-1.57
ccdev
Since you're concern about Eng, let share some more information about its current situation. Market has sent Eng competitor JCY to skyrocket high yesterday in a hope that JCY which plant have not suffer flood should enjoy higher demand of its product and possible at higher margin due to shortage HDD to meet year end PC mega sale.
JCY has since increase production around clock to meet extraordinary demand. Similarly, Eng local plant which account for 60% production also increase production to meet shortfall from its Thailand plant. These couple with potential higher selling price + higher volume + recent weakening RM = better profit margin could at least mitigate adverse effect suffer from its Thailand production line.
hng, thanks for taking the time to explain, appreciate it.
Sold back malton at 58.5-59sen, realize intraday gain
Bought Malton at 58.5sen
Bought Eng at 1.56
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