CRANE sells off a piece of land

1Crane
What happened:

  • Chu kai Plc (ticker: CRANE) announced on the 14th January 2014 a sale of land worth THB 500 mn.
  • CRANE itself is leasing cranes that can be used in many industries such as construction, import and export, refinery plants, power plants, and petrochemical plants. Most cranes of The Company are good used cranes imported from Japan.
So what?
  • We’ve heard about this rumour for 18 months that they are going to be selling this piece of land and a lot of local speculators became involved in the stock which put us off it but let’s see what the impact of this is on the company
  • The expected profit to the company is THB 122.04 mn (net of book value and transactional fees) => an additional EPS of THB 0.21 / share (thb 122mn/577mn shares); in 2011 EPS was 0.22, EPS12 was 0.38, 9M13 EPS was EPS0.28, so you can see the impact it has on the PE for the company on a short term basis.
  • One of our first thoughts was will there be an massive dividend out of this? Doesn’t look likely as the firm wants to pay down debt and use the rest as working capital. So be aware of seeing a low PE for this stock, we don’t say its a bad company, we like their business model, but its just a temporary bump in EPS.
Source: SET

MC Group has two new institutional investors

1mc

On the 13th January, MC Group (ticker: MC) announced two new major shareholders, both are well known long-term investment group, Lombard through its investment vehicle, Mindo Asia Investment Ltd and NTAsian Discovery Fund.

So what?

  • Well both groups are run by smart fellows, Lombard is well-known within Thailand for its holdings in Ticon, CPN, AS, SAT, SNC amongst several others, investments that all generally have done rather well. NT is a new kid on the block when compared to Lombard (who has been around since ’97 if I remember correctly), but they have a good track record when it comes to investing in the public markets. So if they believe in the long term story here, should we be paying close attention?

mcgroupnewshareholders

Source: MC Group

SCB sells off SCSMG

This happened 2 weeks ago as well as a few other deals that I’m just getting around to writing about, the details are as follows:

  • Siam Commercial Bank (SCB) sold a 60.9% stake of Siam Commercial Samaggi Insurance (SCSMG)
  • The value of the transaction is USD 185 mn at THB 27.60/share and SCB is expected to make a profit of THB 1.7bn based upon its cost value of THB 11.9/share
  • The transaction is expected to be completed within 2Q14
  • In compliance with Thai regulators, ACE and its local Thai partner will make a mandatory tender offer for the remaining 39.1% of SCSMG

So what?

  • Well the stock is trading @ THB 26.50, if ACE and its local partners make the mandatory offer then at THB 27.60 thats a return of 4.15% within 6 months from trading. Then again nothing may happen and one is stuck with a holding in an insurance company.

Can the Thai SEC move any slower?

While we applaud the fact that the SEC does take action against insider trading, but 7 years later? Really? And only a fine of THB 27 mn despite the fact this is an egregious action against public investors. Anyways at least we know this is another company to put on the blacklist for investing in unless shareholders and management changes.

The Securities and Exchange Commission (SEC) has imposed a total fine of 26.66 million baht on the Leesawadtrakul family for manipulating the share price of Rich Asia Steel Plc. 

An SEC press statement said Somdej Leesawadtrakul colluded with others in trading RICH shares through 15 related persons’ securities trading accounts to lure the public into the trading of shares between May 10 and July 31, 2007. The Stock Exchange of Thailand found irregular trading of RICH shares by a group of persons during the period.

Source: Bangkok Post

What happened this week 20/01 – 24/01

Thailand

  • EC head offers solution on FB — The head of the EC wrote on his Facebook account that there might be a solution to the current rice scheme problems, but the solution will have to wait until at least the 21st of this month before any action can take place. Rice farmers are angry at the government for the payment delays and have set the 25th as the deadline for government action. (Krungtep Thrurakit, 20/01/14)
  • Ministry of Industry said that the scheme to encourage farmer swapping rice for cane will net an additional increase in cane production by 180mn tons in the coming year. (Matichon, 20/01/14)
  • Tax collection ability in doubt — The Revenue Department fears the protests might hang on for up to two months, hampering its ability to collect taxes. (Thai Post, 20/01/14) Continue reading What happened this week 20/01 – 24/01