*****
Jaks ....The way I look at it
JAKS
Your thesis is that you neglected to look at the property division and too focused on the IPP.
True to a certain extend. But even Andy also increased his stake as recent as April...buying from the open at $ 1.59 and exercising his options at $ 1.40.
All that is history now, and the share is 40+ sen. This is the time true Warren Bufetts act. It would be wrong to be too negative at this price. Whether the bottom is 45 or 30 , no difference in the final analysis if the IPP is successful.
Currently bears dominant and no chance for trading….but this is also the time for the next generation of warren bufetts.
Your bear call at 50 sen……..
I disagree. For those who bought high, no difference already , at most 10 or 20 sen difference a share.
Practise patience, patience is a virtue when shares at bear market prices and company can survive…..Can Jaks survive? Yes, Jaks can survive, this I am sure.
Reasons Jaks can survive :
It raised more than $ 270 million in the last year., including the $ 20 million from the warrants.
The $ 800 million in payables concern you. But a portion of that relates to Vietnam and no cash flow implications. Latest accounts still shows net current assets in excess of $ 300 million, gearing at 0.24 X….Steven Ang highlighted that in a recent conference., cash in bank $ 140 million after setting aside $ 50 million for the Star problem
LAD provisions is not a concern. They have made $ 35 million provisions ( $ 20 million last quarter)....very likely no more is needed.
Evolve Mall, accounting losses but not cashflow losses, $ 650 million in the books. $ 300 million long term loans…..if they can sell for $ 400 million, taking a $ 250 million loss (and raising $ 100 million cash ) also no problem as their shareholder fund in excess of $ 850 million.
Next result can surprise everybody on the positive side….and that is likely their strategy.
A few hundred million in EPCC profits not yet recognised , so P/L wise...this company nothing to worry about...at these depressed prices.
What happens is that Andy has taken this opportunity to swap shares above $ 1 for cheap warrants …...his selling and your selling has combined to depress the share to this level.
Me? I not scared of this share at all….It is only a matter of time before I make money. Whether bottom is 45 sen or 30 sen...makes no difference when the share is traded at above $ 1.00 eventually. …..I think ...it is better for you to share this memo with your friends then to share your sell call at 50 sen…..
That sell call is a trader mentality, this buy call is with Warren Bufetts in mind.
Please note...your two years work in buying Jaks for Vietnam IPP is not a wrong call...It is side tracked by the market and by negative developments in the property division…..but the time to be worried is when it is high, not now…..and maybe., just maybe, this is the time all the bad news in the property division has been provided for in the accounts and reflected in the share price.
I seldom get so bullish on a share and I am seldom wrong….I just want you to know this.
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2018-12-19 12:54
Jaks is in a difficult situation.
It has a lot on its plate.
Its core businesses and finances are weak today.
Its saviour will be successful project of the IPP in Vietnam.
As an investor, you will wish to choose to jump over a 1 foot hurdle than a 7 feet hurdle.
2018-12-20 11:16
In a way conman 3iii is talking sense with integrity here loh...!!
Posted by 3iii > Dec 20, 2018 11:16 AM | Report Abuse
Jaks is in a difficult situation.
It has a lot on its plate.
Its core businesses and finances are weak today.
Its saviour will be successful project of the IPP in Vietnam.
As an investor, you will wish to choose to jump over a 1 foot hurdle than a 7 feet hurdle.
2018-12-20 11:29
3iii
As an investor, you will wish to choose to jump over a 1 foot hurdle than a 7 feet hurdle.
=========
beware of appearances....what appears safe and 1 foot hurdle can be some thing else...and at best 1 foot rewards only.
2018-12-20 11:37
Will continue to lose money until 2020 before completion of Vietnam Power plant.
No cash flow for next 2 years.
Can Vietnam Power Plant complete in time ?
Do you think it is better to wait until Vietnam Power Plant is completed before you invest ?
Invest in stock market, there is no if but must be sure.
Please note that all old projects in Malaysia secured by Jaks, if I am not mistaken all lost money.
2018-12-20 11:39
If investors stand back the share will continue to slide. Then make your move. There is no sifu here .
2018-12-20 16:55
It was the surprise Q3 loss results that caused the selling and the severe under subscription of warrants. The bright side is less dilution from (33% to 15%) for both mother and warrants.
The losses was due to unusually slow progress billing of the vietnam EPC contract.
Jaks' CFO stated that the power plant was 41% completed as at October but Jaks only recognised about 31% completion until Sept. Assuming no progress in Nov and Dec, Jaks may recognise 10% work done which means potential of RM45m profit from vietnam EPC in Q4 2018.
Public investment has indicated that profit recognition of vietnam EPC contract will follow "S" curve. Hence, there will be faster profit recognition hereon as the construction of power plant enters into equipment installation phases. The power plant will be substantially completed by end 2019 as it advances into synchronization and performance testing before it starts to generate electricity by mid 2020.
Q4 2018 will mark the turnaround in results. The results will be announced before end feb 2019, and it will mark the end of winter for Jaks.
2018-12-20 20:49
Latest news .....Jaks has released 50 millions to Star . The dispute is finally settled. The worst is over.
2019-01-16 20:05
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2018-12-19 12:22