PEB is a nett cash company with NTA = 1.02. Simple maths, it will just cost Pitahaya 5cents to buy your share through MGO. Similar to Paragon Union, Pitahaya can't force you to sell your share through MGO. Another good example is FGV, flying 20% after FELDA failing to take over 90% of share. FGV retailers who are still holding must be celebrating now.
To begin with, our homeland Malaysia is targeting to achieve 20% renewable energy by 2025. As of now, we are somewhere between 5% - 7%, 4 more years to go! However, renewable energy does not equal to SOLAR. There is hydropower, biomass, biogas, wind and solar when it comes to renewable energy. So why are investors loving solar-themed companies so much?
Apart from the hype from LSS4, solar, despite might not be the most efficient type of renewable energy is easier to scale than the rest of the renewable energy. Wind in Malaysia is not sufficient to serve as a consistent stream of energy, biomass require steady flow of FFB waste and hydropower is highly dependant on location (high or low head), and the initial capital investment is usually much higher.
Hence, Malaysia being one of the rare countries on Earth that is standing on the equatorial has a decent amount of sunlight and was not subjected to major weather changes, hence why solar is so important to Malaysia.
However, there are two types of “Solar” companies in the market. One being the contractor who buys the panel and build the solar PV farm, the EPCC contractor and the concession / asset owner.
EPCC has proven more challenging as the margins are getting thinner since demand for solar panels are spiking. Unless you are going for cheap panels, the EPCC margins are practically, razor thin.
On the other hand, concession, or asset owner – especially those involved in LSS1 & LSS2 are enjoying a much better tariff or margin. The difference between the margins are approximately 2 times as compared to the market in 2016. In short, assets that are from 2016 – 2017 are enjoying a “premium” as compared to the latest LSS4!
This company – Pimpinan Ehsan Berhad (“PEB”) is going to do something really interesting. PEB will engage with reNIKOLA Sdn Bhd, who owns and operate a total portfolio of 418 MWp* of solar farm.
*The 330 MWp Bukit Kayu Hitam plant will soon commence its construction.
By comparison, CYPARK did not get the LSS4 (intended) and it is currently operating a 47 MWp worth of solar farm, which is relatively smaller than PEB! The current valuation of CYPARK is approximately MYR 655 Million, and PEB is only having a valuation of MYR 113 Million. Why is that so?
Simple. The complexity and difficulty in understanding the corporate structure for PEB had shun some investors away from this gem. There are also rumours about the company getting delisted by June this year, which I say – nonsense.
According to Bursa’s regulation, not only does PN 16 company can prolong their period to acquire income generating asset – almost indefinitely as long as the plan is sound and beneficial to minority shareholder. Plus, we noticed that the new owners of PEB, a.k.a. the owners for the solar assets had acquired up to 38% of the company, which costs him or her approximately MYR 30 Million.
Being an quiet observer in the forum, I noticed that some are giving good advices on investment and some are purely (poorly) trying to defame the company and collecting at a cheaper price. Unfortunately for them, there are still strong buying power at the 1.600 level!
As an investor of PEB, I urge you to focus on the solar assets that PEB owns. This company will become huge. Maybe not now, tomorrow or the day after tomorrow. But eventually it will hit its previous high of 2.410 level.
Samaiden is the smallest among few solar counter. Btw it is market sentiment, Majority of the solar counter recently not seems to be so strong. In this case, I more suggest that people who in early stage average down, this suggestion is only for long term share holder.
Tech and solar counter seems not so strong on recent trend, but is also a good time to keep collect for tech and solar counter. PEB is high potential to be a black horse if they started to build up and on track with all the business.
PEB will be one of the best solar counter among the others solar counter
Here we see a bunch of bulls living in their own alternate universe in which corporate finance rules do not apply. The market will teach them a lesson better than their uni professors. Mark my words.
My apology if what I wrote has hurt your feeling. Perhaps adding "CF" in front of "lesson" would sound less condescending. Seriously, I think you guys have gone on the wrong analytical track. Don't take my words for it. Check with your investment specialist (FMs, analysts, investment bankers or accountants) friends re what I said in multiple posts earlier. I wish I could explain better and clearer. All the best and take care.
Lots of comments here talk about how great the solar industry is and then just a pluck a figure from the air and used it as the value of PEB. All these bullish outlook is not supported by facts. Just some industry info and then they can magically come up with RM2+ per share. These are typical investors who already bought PEB now wants everyone to come in and support the price
Until today, none of these bullish supporters can give an actual figure for the valuation of PEB. i.e. what is the value of reNikola being injected into PEB. Without that figure, nobody, and I say it again, nobody can acurrately say its undervalued.
The following statement from techinvestormy is completely wrong and yet he is not aware of it and continue to peddle wrong info to the detriment of all those who read postings here....
"......Plus, we noticed that the new owners of PEB, a.k.a. the owners for the solar assets had acquired up to 38% of the company, which costs him or her approximately MYR 30 Million...."
Can anyone tell us what is wrong with the statement above ?
Can I ask what do you mean by risk ?. How do you know that the current price reflects the risk you have to take and as such by extension how do you value it relative to other equities ?
A generalized statement like "higher return for higher risk" does not impart any meaningful outcome.
JUDGING BY THE PUBLIC INFORMATION GIVEN BY THE COMPANY AND SOME COMMON SENSE ON SHAREHOLDING, THE CHANCES OF PEB‘S RTO TURN SOUR ARE LOW. AND BASED ON PERSONAL EXPERIENCE BY STUDYING RECENT RTO CASES, WE HAVE NO CHANCE TO BUY AT A CHEAPER PRICE LATER ON, ONCE ITS GONE, ITS GONE.
THAT BEING SAID, THERE WERE NO CONTROLS ON WHEN WOULD PEB COMPLETE THE DEAL AS WELL AS THE MOVEMENT OF SHARE PRICE. DO YOUR OWN ANALYSIS AND MAKE WISE INVESTMENT DECISION.
MIND YOUR OWN RISKS WHEN INVESTING IN PIMPINAN EHSAN BERHAD (KLSE:PEB)
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....
lexxi012
68 posts
Posted by lexxi012 > 2021-03-16 18:44 | Report Abuse
PEB is a nett cash company with NTA = 1.02. Simple maths, it will just cost Pitahaya 5cents to buy your share through MGO. Similar to Paragon Union, Pitahaya can't force you to sell your share through MGO. Another good example is FGV, flying 20% after FELDA failing to take over 90% of share. FGV retailers who are still holding must be celebrating now.