The capex of more than RM 200 million for state of art factory in segamat would brings several immediate benefits to evergreen:
- paying lesser tax in the next 4-5 years. The government had. granted a special reinvestment allowance up to. every RM put in during 2016-2017 can entitle for RM 1.60 tax reduction.
_ evergreen can enhanced the competitiveness with cost efficiency as a result of newer factory and machinery.
_ better topline revenue and gross margin from the reinvestment.
This is a good indication of capable management.
The best opportunity appear to contrarian is all the above benefits require time to materialise while the cost have absorbed and thus making profit dropped temporary.....
when short sighted and dissapointed investors begins to divest .....great opportunity begins to unfold...
The best is when the above coupled with temporary external industry setback like the shortages rubberwood and glue cost hike.....this will create year low share prices for evergreen...
FYI...evergreen had 4400 acres of rubberwood plantation in mersing, Johor and they got facility for making their own glue.....
The competitors don't. have these advantages...thusallow evergreen to enjoying back super fat profit in the subsequent year
The market is fair on surface...in the short term where prices got hammer down in tandem with. misses in profit target....BUT UNFAIR as real reasons mentioned above unknown to massess
we need courage to act upon when gap arises and. we need the holding power to insure what. we don't. knows in short term...to outperform day traders. or fear investors
Datuk, are U a medium / long term investor for Evergreen? Evergreen is having oversold situation for past 4-6 months n many investors feel lack of confidence, guess so... Evergreen has 4400 acres of rubber plantation at Johor ? I didn't study deep enough but know that evergreen should be the largest MEdium density fibreboard company in South East Asia n previous 3-4 quarters below average maybe due to high log n rubber wood prices, strong Thai Batt n investment outlay for her plant .... Rebounce back to Rm1.00-1.10 will make many investor to feel happy already, happy investing ,..
datuk, i like reading ur comments. Can u explain to me why evergreen still have so much borrowings about Rm 211,786,000? Isn't it too high? Is it unable to pare down borrowings?
when you are in billion RM club like evergreen,.it's pretty normal to have borrowing.
when you are in business expansion like evergreen, it's abnormal to utilizef only internal resource to fund the capex. i am not rational to expect you buying house via your own money although it's possible for a small scale requirement.
Gearing for business expansion is not a matter. warranted for worries. What matter to investors is the purpose and the ratio in relate to the. overall financial
Look for the cash. flow generating from business....i expect to see evergreen should be able to generating RM 125 million in the next 2-5. years upon the full realization of strategic imperative from the new capex laid down by management.
Philip Fisher once said the best investment. opportunity might be arises when the capex. didn't. generating expected result like evergreen experiencing right now....
Those promote desperately is bcos they bot at high price and incurred huge loss .... not only this counter, every counter they loss until panic they will ask other ppl to support the price .....
How can it be DATUK to be happy investing, if the price keep trending southward, Lower high, lower low. It look like, this friendly counter is going to test to a support level 50 sen and possible to go further down to 35 sen. Hope the history will not repeat again to this last support level at 35 sen. Mama Mia,,,,,,,,!!!!!!!!!!!!
i have sufficient bullets to top up in multiple rounds when the price becomes more attractive.. and more importantly, i have that holding power that allows me to wait and reap later... so who is shitting in the pants?
Agree with Dolly, evergrn is not a tom dick harry company. worth holding and even top up more when price looks attractive. You don't call yourself investor if just ride on the uptrend, but merely a trader or opportunist.
"The stock market is not a casino, but if you move in and out of stocks every time they move a point or two, or if you continually sell short or deal only in options or trade in futures, the market will be your casino. And, like most gamblers, you may lose eventually - or frequently. " - #SirJohnTempleton
individual has rather limited influence here...no one is going to follow your write up except you are indulging in self comfort...
The time has due for evergreen.to emerge as weighing machine rather than a voting machine since the price had dropped more than 30% prior to the dissapointed result announced earlier.
Investing in the current price ranges made the controlling shareholder even.envy you...
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....
datuk
4,935 posts
Posted by datuk > 2018-02-05 10:24 | Report Abuse
it's a great opportunity for contrarian to capitalize from the fear of masses