Skp got very smart management team. No worry, if down some more just buy . No worries. They still got other big client. This moment the sentiment is bad cos Ata have affected a lot of investor , fund management and banker. I think this bad sentiment will be short .. for now is opportunity to buy at cheap price … the Best Time …
I slowly collecting them, back in 2008 - 2014, i always tell skp holders, this is long term investment and this is a good company, it will bear fruit in years to come, and results have shown it reliability :)
this labour issue will eventually be resolved, just like topglove. to average down or not is up to you, and if you choose to average down, do it in tiny steps. good luck.
1. ATA choose not to resolve their issue, whereas VS and SKP open for talking. 2. ATA lost their main customer which contributes 80% of their profit/revenue, SKP and VS more diversified. 3. ATA has debt, SKP is debt free. 4. According to Andy, only yhe SPI not the SKP entire workforce is effected, it is the temporary workers, not permanent workers.
it's better to solve our labour issues with our labour ministry than with Andy Hall! VS n SPK discussion with Andy Hall is a waste of time n money entertaining this fellow! He is just an activist who now championed for d Banglas in Malaysia! U think d EMS owners will give in to all d banglas demands? If like this all Malaysian's companies eg. Plantations, Rubber Gloves, etc. employing banglas will have operations failures!
Whatever we say here is not going to influence the price. All we know is SKP has 0 debt, positive cash flow, was operating at 60% capacity during lockdown, this means next QR will be good, and most important of all, they are not denying and fighting like ATA. They as in SKP and VS, both try to be polite and work things out. Eventually it will get sorted out.
1. Going forward, it will be resolved. 2. ATA business as the biggest dyson subcon will flow to the other EMS, thus more profit. 3. SKP will see how ATA fell due to dyson, thus I believe management will now try harder to secure other clients, thus the potential profit growth will be even better in the future.
Nobody knows the future, nothing we say here can influence the price and volume. All we can do is wait.
The market is giving discount to the valuation of SKP. I guess PE/G is the right way to estimate the price of a company. I did some calculation on the forward PE of SKP in the current FY with IBs' reports as the reference. Without a doubt, PE 15 should be the normalized value for SKP. Hence, RM1.5+ to RM1.6+ should be the fair value of this stock.
Current marketcap is 2.4b. estimate normalize free cash flow around 150mm, thats still more than 15X. In view China consumer spending contraction. Looking forward for it to drop to around 1.5b market cap for more buffer before enter.
Last quarter their capacity was at 60% due to lockdown, coming quarter will be better. With the expansion and potential business from ATA, it will only get better. I think current price around RM1.60 is just about right.
@Kang Yao, I think you should account the future fcf into ur valuation. However, I don't think fcf is the real way to value any companies listed in Bursa. Good luck for waiting the market cap drop below 1.5B.
Why will it go back to 1.5B mktcap? I dont see them making less profit, and they are in talks with andy hall and others to iron out all problems related to workers. plus, they are expanding.
Not to mention, 0 debt.
If you are going to use cash flow as a measurement, then TG during 2020 to Jun 2021 can be considered super super super cheap.
market anticipates future growth and earnings growth. I am very certain the coming few quarters they will continue to grow, dont forget ATA lost Dyson and some business will be given to SKP.
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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....
DuitGeli2
443 posts
Posted by DuitGeli2 > 2021-12-08 10:32 | Report Abuse
Andy Hall is the kingmaker now!!! Ooo yeahhh