BIG (7005) - BIG - Big Break Forward

B.I.G Industries Berhad (BIG - 7005) is a Sarawak based company that had started it's operation in Miri, Sarawak since 1982. Current core business activities involved manufacturing of industrial gases, manufacturing and distribution of ready mixed concrete in Sabah as well as property development in Sarawak, Sabah and Peninsula Malaysia.
Most of the core activities is based in East Malaysia. With the current massive state of development in East Malaysia, particularly Sarawak, it had brought into massive foreign direct investment into the state of Sarawak. The SCORE development plan as well as rising industrial park such as Samalaju Industrial Park had took a major change in the economy landscape in Sarawak.
With the most important event being the Sarawak Election that is to be staged in April 2016, massive infrastructural contract packages such as the much anticipated Pan Borneo Highway are being awarded out. Other than this, Sarawak is also addressing the needs of affordable housing through PR1MA housing project to address the needs of the rising younger population.
With such major development that Sarawak is under going, how would this be a game changer for BIG in the short term and long term outlook?

Looking on to the price chart of BIG could be indicating several major event that will have drastic material impact towards the financial of the company. BIG had saw active trading and accumulation on several different occasion in 2014, 2015 as well as 2016.

A longer outlook will set out a resistant line at the range of RM 0.70. The current price consolidation at RM 0.70, which is assisted with a ascending triangular consolidation pattern could had particularly signal out a saturation on the consolidation effort which could spark out a potential strong break up. Immediate break out trading range to be see at RM 0.70 to RM 0.80. BIG is expected to see more volume to build up in the coming days.


A Loud Big Bang

One of the core factor that had assisted in the rising share price of BIG is it's underlying asset. While business continue to be volatile, BIG's gold mine land asset in Kidurong Industrial Park, Bintulu is heading for a one-way rocket towards the North as Sarawak opens up to foreign investor to spur up the economy in Sarawak.

Bintulu, being the gateway to the highly sought after Samalaju Industrial Park had saw land prices appreciating more than 400% for the past 3 years.

According to the Annual Report 2014 of BIG, it is indicated that their land and factory is still carrying a valuation based on 1991, while the12243 sq meter (131,782.5 sqft) vacant land is valued at RM 630,519 based on valuation at 1995.

Compared to the latest valuation in 2014 - 2015, both of the land are grossly undervalued.

A quick comparison will be the factory of CCM at the same Block 26, Kemena Industrial Park had saw a 78,752 sq feet land and factory carrying a RM 35.8 million tag, based on valuation in December 2014.

According to familiar land valuer that focuses at Kemena Land District and Tanjung Kidurong, the land price at Kemena Land District is now ranging from RM 175 to RM 200 per square feet.

Based on this fact, the current market value for Lot 2072 should be approximately RM 26,356,500 (based on RM 200 psf), which will see a land sale windfall gain of approximately RM 25 million. The land sale windfall gain will translate to RM 0.52 per share. Sources informed that the land is being courted by a few interested parties and will be looking to seal the deal within this year.

To recap, Harbour Link Group Berhad is a proven material from the economic boom in the Kidurong Industrial Area.

The escalated economic push in the area had came in the way for Harbour, which had a approximate 100 acre of land to cater for large shopping malls, large size petrol station, large size shop houses and industrial lots.

Harbour share price had more than 300% increase since 2014 (3rd Jan 2014 - Harbour share price RM 0.85)


On Going Future Prospectus of BIG

Addressing the need for affordable house is critical in cities of Sarawak and Sabah. In line with the upcoming Sarawak Election in April, apart from massive infrastructure project such as Pan Borneo highway, BIG should be making it's way to benefit from the affordable housing projects - PR1MA in Sarawak.

We will also be upbeat on the Concrete division for BIG in FYE 2016 to deliver a much better result due to more commencement of construction project as well as government infrastructural project.


Conclusion
BIG is an uncovered gems sitting on gold mine land in Bintulu (Kemena Industrial Area). With the land itself being able to contribute a gain of RM 0.52 per share based on a windfall gain of RM 25 million, BIG share price is looking to see more upward surge. Can BIG hit the ceiling limit this time? Most importantly, are you going for this ? Your decision.

Bone's TP : RM 1.00 (Potential to hit ceiling)

Have a nice day

Regards,
Bone 

BIG (7005) - BIG - Big Break Forward
http://bonescythe.blogspot.my/2016/03/big-big-break-forward.html