Posted by pingdan > 2015-11-22 22:19 | Report Abuse

My opinion on Mercury. Dont shoot me if im not correct. Just for discussion.

1) Profit guarantee of RM6.6million per year - 70% = RM4.62million
2) Profit for manufacturing factor (using 1/10/2014 to 30/9/2015) - For 30/9/2015, i will excluded construction part - 7.6mil minus 2.6mil + 1.3mil = RM6.3mil

Total = RM10.82mil

EPS = 26.92sen (estimated future)

Current price : RM1.46

Posted by pingdan > 2015-11-22 22:27 | Report Abuse

Revenue for PBSB
2012 : RM96 mil
2013 : RM119 mil
2014 : RM61.8 mil
2015 to 2017 : RM120 mil (according to the contract and might be more) - so one year around RM40mil

Profit for PBSB
2012 : RM2.7mil
2013 : RM2.2mil
2014 : RM6.5mil
2015 to 2017 : RM19.8mil (profit guarantee and might be more)

From the top, you can see the profit is increasing after acquisition. It is abit strange from the past record and im very doubt the the company are able to achieve the result of RM6.6mil per year. Keep in mind that with the depreciation of ringgit, the cost of material have increased. This have eat the profit margin for construction company.

But since there are profit guarantee given, the profit surely reached RM19.8mil in 3 years or RM6.6mil per year.

Good investment until 30/9/2016. The share price of Mercury might reached peak after the release of result on 30/9/2016 as all of the impact from the subsidiary will inside the quarter result.

Posted by pingdan > 2015-11-22 22:30 | Report Abuse

After release of 30/9/2016, unless PBSB get new project, if not this company will just sink down the revenue of Mercury. Keep in mind the revenue keep dropping. Im scare it is the intention of director to cash it out the company to listed as he foresee they are no future in this company. But i just guessing. Maybe im wrong.

Posted by pingdan > 2015-11-22 22:36 | Report Abuse

Impact to balance sheet after acquisition of PBSB

Mainly their debtor increase by RM40mil. I guess it is from diamond residence phase 2 as the contract ended during the year. (RM43mil contract)

Cash decreased by RM13mil even included the cash in PBSB. Mean no cash in PBSB???

Borrowing increased by RM30mil due to borrowing to buy PBSB

Trade and other payable increased by RM23mil. Most of that should be the amount due to their sub-contractor or supplier of material

Bank overdraft increased by RM4mil. So mean PBSB no cash and have bank overdraft which eat alot of interest??

Posted by pingdan > 2015-11-22 22:41 | Report Abuse

From director perspective,

1) Director losing 70% in PBSB
2) Director getting RM42mil cash
3) Director selling the entity that might lose at future?? (I guessing, maybe im wrong)
4) Director able to get capital gain in Mercury share
5) Director getting better director fee for performing well.
6) Director might loss money if PBSB not earning RM19.8mil in three years.

Posted by pingdan > 2015-11-22 22:42 | Report Abuse

So it is a good company or bad? Yes share price will go up definitely if nothing happen.

But after you see what director gain, will you invest?

This is call grey area. In this case, statistic is not that useful. Experience in investment does.

Posted by JT Yeo > 2015-11-23 03:02 | Report Abuse

The director that sells the 70% in PBSB is the same director running Mercury now. Yea this isnt a buy and hold forever play, more like a 'special situation' or arbitrage play. The profit will only increase slightly if you taking into account the interest they have to pay for the borrowing, but im expecting an upward move on ROE, which may or may not push the price up. But compare to having a large sum of cash sitting in the bank earning 2-3%, definitely better to have it use it on assets (construction) generating future cash flow.

I cant say much about the director since my guess is same as anyone. He has quite a large stake in Mercury as well. Unless he offload all his stake in Mercury when the price has gone up, he will still need to manage both the main biz and construction biz well. I only know he is famous for turning around biz. He is the director for Eco first and having turned their property development biz around few years back.

Posted by Meran > 2015-11-23 14:12 | Report Abuse

http://www.theedgemarkets.com/my/article/ni-hsin-partners-angkasa-boost-its-product-reach#.VlKifl8AjMk.twitter

Posted by Meran > 2015-11-23 14:14 | Report Abuse

Angkasa lifted Nihsin from bankruptcy..... i suggest your next article headline
hahahaha

Posted by JT Yeo > 2015-11-23 17:43 | Report Abuse

ok good good, accumulate more. Nth worth writing.

Posted by sembangsaham > 2015-11-24 02:50 | Report Abuse

Do you want to buy nihsin at cheap price?

Posted by sembangsaham > 2015-11-24 02:56 | Report Abuse

Notice of Shares Buy Back - Immediate AnnouncementNI HSIN RESOURCES BERHAD
Date of buy back23 Nov 2015Description of shares purchasedOrdinary shares of RM0.20 eachCurrencyMalaysian Ringgit (MYR)Total number of shares purchased (units)2,000,000Minimum price paid for each share purchased ($$)0.343Maximum price paid for each share purchased ($$)0.343Total consideration paid ($$)687,596.13Number of shares purchased retained in treasury (units)2,000,000Number of shares purchased which are proposed to be cancelled (units)0Cumulative net outstanding treasury shares as at to-date (units)10,526,500Adjusted issued capital after cancellation 
(no. of shares) (units)Total number of shares purchased and/or held as treasury shares against the total number of outstanding shares of the listed issuer (%)4.44907


Announcement InfoCompany NameNI HSIN RESOURCES BERHADStock NameNIHSINDate Announced23 Nov 2015CategoryNotice of Shares Buy Back Immediate AnnouncementReference NumberSB1-23112015-00005

Posted by DannyTanSiongKee > 2015-11-29 19:01 | Report Abuse

What rubbish is this article about?

Posted by DannyTanSiongKee > 2015-11-29 19:02 | Report Abuse

What nonsense is borrowing from the stock market?

Posted by DannyTanSiongKee > 2015-11-29 19:03 | Report Abuse

JT Yeo, what kind of idiotic assessment is this? Such unprofessional. Exactly like Icon8888

Posted by NOBY > 2015-11-29 22:54 | Report Abuse

I did not study Nihsin but just for discussion purposes. I believe ROIC is a good metric but there are many ways to skin a cat. There are few conditions in where I would buy a low ROIC company, not necessarily hold it forever.
1. It is a net net stock. Meaning solid balance sheet, trading at big discount to NTA or some balance sheet metric. It must also be somewhere near the all time low in terms of P/B or P/NCAV with improving fundamentals.
2. It is a turn-around stock. It could be a cyclical business on the cusp of a turn-around where ROIC may eventually revert to the mean.
3. It recently went through major expansion thus incurring high depreciation charges which depress the EBIT or EPS. Hevea is one good example. In this way, I will look at P/FCF as a metric
3. No red flags in terms of insider actions, share dilution, debts increase.

Posted by hissyu2 > 2015-12-26 22:25 | Report Abuse

hahaha~~ I really do not know a low ROIC can lead towards bankruptcy ~ you are amazing :)

I didn't study this company. I am not sure if it has FCF every year. But, based on the article below:
http://klse.i3investor.com/blogs/rhinvest/88686.jsp

RichHo was saying Nishin debt is decreasing and cash is increasing... It could tell me, the company is able to generate real cash every years...

I didn't see the share capital increased a lot over years(meaning no other type of finance leaverage)

I am seriously wondering how could a company like this could lead to bankruptcy... LOL