Elite KSB Holdings

[heifien91]

Elite KSB announced their full year report, pending for the final settlement of the disposal.

http://info.sgx.com/webcorannc.nsf/Annou...endocument

Few points to note are

- The book value of the China investment increases from $6.8 Mils to $10.5 Mils
- The earning of the China investment increase from $2.5 Mils to $2.9 Mils, an increase of 16%

Pending with the special dividend after the disposal, the company had declared 1.5 cts final dividend

I am expecting at least 25 cts special dividend from the disposal, so total 26.5 cts including the final dividend.

Hi CityFarmer,

How did you come up with a figure of at least 25cts special dividend? Just curious..

[CityFarmer]

Elite KSB announced their full year report, pending for the final settlement of the disposal.

http://info.sgx.com/webcorannc.nsf/Annou...endocument

Few points to note are

- The book value of the China investment increases from $6.8 Mils to $10.5 Mils
- The earning of the China investment increase from $2.5 Mils to $2.9 Mils, an increase of 16%

Pending with the special dividend after the disposal, the company had declared 1.5 cts final dividend

I am expecting at least 25 cts special dividend from the disposal, so total 26.5 cts including the final dividend.

Hi CityFarmer,

How did you come up with a figure of at least 25cts special dividend? Just curious..

Please refer to post#25 of this thread for detail

[cif5000]

IMO, If total sale proceeds are distributed, Mr Market should value feed-mill biz at least PE 5x, which is 12.5 mils and PB of 1.8, i.e. at least 4 cts premium over the group NAV

Ok, book value has gone up so PB would have shrunk, but still above 1 using your valuation. I am just wondering which S-chip is trading at a premium to book...

[CityFarmer]

IMO, If total sale proceeds are distributed, Mr Market should value feed-mill biz at least PE 5x, which is 12.5 mils and PB of 1.8, i.e. at least 4 cts premium over the group NAV

Ok, book value has gone up so PB would have shrunk, but still above 1 using your valuation. I am just wondering which S-chip is trading at a premium to book...

I am always using PE as key ratio, and PB as supporting ratio, for most of my valuations.

IMO, using PB for non-capital intensive business may mislead to under estimation of intrinsic value. Feedmill is non-capital intensive business, with its asset turnover of close to 10 and ROA of close to 20% (as in FY2011).

In fact, i do think that it might be way under-value with the PE of 5x, after its performance in FY2012. Well, need to further confirm after the full AR2012 is announced.

BTW, with valuation of 12.5 mils remain the same, the PB improved from 1.8 to 1.2 in one (1) year, a -35% reduction. Does it indicating that it deserve the valuation?

[cif5000]

IMO, If total sale proceeds are distributed, Mr Market should value feed-mill biz at least PE 5x, which is 12.5 mils and PB of 1.8, i.e. at least 4 cts premium over the group NAV

Ok, book value has gone up so PB would have shrunk, but still above 1 using your valuation. I am just wondering which S-chip is trading at a premium to book...

I am always using PE as key ratio, and PB as supporting ratio, for most of my valuations.

IMO, using PB for non-capital intensive business may mislead to under estimation of intrinsic value. Feedmill is non-capital intensive business, with its asset turnover of close to 10 and ROA of close to 20% (as in FY2011).

In fact, i do think that it might be way under-value with the PE of 5x, after its performance in FY2012. Well, need to further confirm after the full AR2012 is announced.

BTW, with valuation of 12.5 mils remain the same, the PB improved from 1.8 to 1.2 in one (1) year, a -35% reduction. Does it indicating that it deserve the valuation?

I understand. You use some numbers to derive your valuation. What I am saying is, will/should the market (Mr. Market) provide that valuation? knowing that other S-chips are trading at discounts.

[CityFarmer]

I understand. You use some numbers to derive your valuation. What I am saying is, will/should the market (Mr. Market) provide that valuation? knowing that other S-chips are trading at discounts.

That touch on a fundamental believe of value investor. Will Mr Market provides that valuation (over long term), assuming the valuation is close to the intrinsic value?

I believe it will (over long term) because it's pretty sensible for the valuation i.e. should be close to its intrinsic value.

[CityFarmer]

Elite KSB Holding's disposal agreement date line extended to 31 October 2012

http://info.sgx.com/webcoranncatth.nsf/V...E0036C650/$file/EliteKSB-SupplementaryAgt.pdf?openelement

It take time to close the agreement especially involve SGX and shareholders approval.

The next milestone is the distribution of EGM notice and of course the EGM

[CityFarmer]

Here comes the AGM and EGM notices, another milestone met. The next one is the EGM's result

http://info.sgx.com/webcorannc.nsf/Annou...endocument

http://info.sgx.com/webcorannc.nsf/Annou...endocument

[kbl]

Here comes the AGM and EGM notices, another milestone met. The next one is the EGM's result

http://info.sgx.com/webcorannc.nsf/Annou...endocument

http://info.sgx.com/webcorannc.nsf/Annou...endocument

Hi CityFarmer san,

Yes...special dividend around 25cts(S$33.6m divide 135 473) if the sale OK.

[CityFarmer]

- The book value of the China investment increases from $6.8 Mils to $10.5 Mils

...as no dividend was declared from these associates.

If the more 50% increase in book value is due to their organic growth in 1 year (with no distribution as dividend), then i am more than happy to hear that. But i really doubt so, let wait till the full AR, then we may able to know more detail.

The FY2012 full AR is available.

The increases of book value is mainly due to share of profit for FY2012 (as highlighted by cif5000), partly also due to addition of a 30% holding associate in food trading and distribution business.

Weifang Gen Yuan Food Trading Co., Ltd