SOS Will Warren Buffett buys Gadang?

Author: sosfinance   |   Publish date: Tue, 3 Mar 2015, 11:28 PM  

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Chart	Stock Name	Last	Change	Volume
	GADANG	1.01	-0.01 (0.98%)	4,015,000

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   AyamTua likes this. 

   Showing 3 comments.

AyamTua realistically speaking, no. only folks like you and me.

03/03/2015 23:34

apini SOS, 

Let me make you words simple. The US Warren Buffet won't buy, but Malaysian situ like cold eye , uncle Z, icon , aping, dindong,.... had already bought a lot and still accumulating.

04/03/2015 00:34

Icon8888 Sifu apini bought a lot 

Welcome to Gadang !

04/03/2015 05:36

 

UPDATES in RED (26 November 2016)

1.  I mentioned one of the catalysts is Captial City.  Up to 31/8/16, was informed that only 12% of PBT was recognised in the books after discussions with Fund Manager, Analyst, and the senior management.  Still about 88% to go.  So, this catalyst is only 12% utilised. (Of course, there are a few new catalysts not going to mentione here - see earlier blogs)

2.  Not sure all the commentators sold when it reached RM2.90 (pre-bonus).  Congratulates to them, if they have sold after doubling their profits.

3.  At today's price, RM1.01 (post-bonus) or RM2.53 (pre-bonus) + a quarter of a free warrants (will be traded on 28/11/16)

4.  At RM2.53 (MCap of RM650m - with net cash of RM80m), based on consensus by analysts (use as reference, at times they are wrong), average next 3 years average profit per year is RM100m.  So, it is trading a PE of 6.5x.  

5.  I am not a forecaster nor a futune teller, each investor MUST invest based on the Group's ability to generate earnings (economic substance).  We do not make money based on past growth.

6.  Last but not least, I like to share one of my favourite Warren Buffett's quotes,

"Of the billionaires I have known, money just brings out the basic traits in them.  If they were jerks before they had money, they are simply jerks with a billion dollars."

UPDATES IN BLUE (29 November 2016)

1.  This remind me of AirAsia, when the Negative Research came out:

     Jan 2015           RM2.90  (Negative research report came out in Jan)

     Aug 2015          RM0.90  (took about 8 months to lose RM5.5 billion market cap)

     Aug 2016          RM3.20  (took 12 months to regain RM6.4 billion market cap)

     29 Nov 2016     RM2.67  (took 3 months to drop RM1.5 billion market cap)

2.  If we look at Gadang, it start to drop from

     24 Oct 2016      RM3.30  (market cap = RM850m)

     29 Nov 2016      RM2.38 (95 sen x 2.5) dropped 28% in one month  (market cap = RM610m)

     Dropped about RM240m (is it due to major negative impact to the income generators?)

     1)  because they did not smoothen the profit of FYE16Q4 and FYE17Q1?

     2)  did not get new infrastructure constracts? But they did get Kwasa Land development contract, RM700m isn't it?

     If we look at it rationally, item one does not improve the economic value of the company.  But item 2 does, however, not immediate. What is so different of getting a RM500m contract for infrastructure & a RM700m contract for property development in profit wise?  The major difference is timing.  The property development contract may be better margin than the Infrastructure (don't we agree).  Which one do you think can bring in more earnings? Is it that bad if the earnings comes from property sector. 

Nobody will be able to explain the price-action activity, but, if we look at the substance, there is not much change in the company, as far as income generator is concern.  Perhaps, this round property may contribute more, and FYE18, construction will contribute more.  When we look at IJM for the last 30 years, can we distinctly tell what really contribute to its bottom line (construction, property, infra, plantation, industrial)?  As long as overall, there is good growing trend, isn't it good enough as a Group when construction down, property may contribute more, when property down, construction will contribute more, or from infrastucture and plantation is gradually build up as a strong contributor.  Isn't it what Gadang is trying to do?  

It may be pointless to clarify this (at this point of time) as the sentiment (price-action) already overtake rationale investing.  Therefore, I bought some at 93 sen.  (Warren Buffet said it is the dumbest thing to do is to buy a stock (biz) because the share price is going up.)