The metering segment is good but lack recurring income as the water meter are quite durable and normally replacement cycle is very long, probably every 2-2 decades. Thus, most biz are 1-time and really have to grow new markets.
If not securing new construction contract, and depend on metering segment as main stream of income, the glory achieved last year during era of Bossku is gone with the wind. Metering biz is not sexy at all and cannot deliver significant growth and so its share price.
Key words: “Proceeds from the offering will be used by the Government for its general purposes, financing development expenditures that among others include building schools, hospitals, public roads and utilities,” it said.
lilu, finally a kindred spirit! It is a lonely world(intellectually), finding discrepancies between value and price. Most people here are just price hawk, they are not bothered with the company performance.
Have you tried to compute the incremental return on capital of this company over say 8 years? Of the few hundreds companies I surveyed, this company can be ranked as the select few in the high double digit group.
"Samurai Bond - building schools, hospitals, public roads and utilities." The pertinent question is if Gkent will secure relevant contracts from non-Bossku government?
If yes, GKent will definitely fly again to close the so called gap on value - price.
If no, then there is no gap between value - price as the market has calculated that once the existing contracts from Bossku complete, company income will heavily dependent on metering segment which is not attractive and cannot justify for high value as last year.
I am waiting for long for the first non Bossku construction contract to Gkent. I have high hope that Gkent should able to achieve that judging from the water meter contract from Pakatan states S'gor and Penang. I also have confident that GKent has real competitive capability in construction engineering and the past eng. contracts were not secured merely thru Bossku factor but largely thru its own competitiveness.
However there is one negative statement from the Boss of GKent in the last qtr note that the company will focus and expand metering segment. The hidden message is that the lucrative engineering/construction segment will be slowed down.
I am holding for long term. Hoping for more hospital and ECRL projects. Current quarter result may not be good but second half should be very good. If next year can get ECRL projects share price can go up very very high. I expect got dividend in April.
What should be the fair value of the company.? The rail project and etc means a lot of spending for the Govt. Yes Gkent good company the price of the share had drop a lot after the election why ? My view reasonable price 1.35
Strictly ... a BossKu crony co. How else can a known ' water meter ' base company lands specialised ... hospital project or rail construction works costing hundreds if not RM billions .. with zero experience ??
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
xiaoqing88
504 posts
Posted by xiaoqing88 > 2019-03-08 15:21 | Report Abuse
break break break go go go