Following discussion covers
1) RM2.1BILLION PROJECT IS MOVING?!!!;
2) APPOINTMENT OF DATUL LIEW KOK LEONG AND MR CHIN KOK FOONG!!! WHAT ARE OTHER NEWS IN MAKING?
3) Worry of repeating of what happend to tattgiap, VC and etc
1) RM2.1BILLION PROJECT IS MOVING?!!!;
In January 2019, PSIPTEK made an announcement of project worth RM2.1billion under JV with TTSJ Trading Sdn Bhd and and AA Strategic Marketing Inc Sdn Bhd!
Perhaps many would think HOW REAL is this project? and there is no progress therafter? Some would even worry this is a SCAM?
Indeed the TTSJ Trading Sdn Bhd, a trading arm of a Pakistanis company has meet deputy chief minister of Sabah on 10/12/2018 before a relatively quick JV announcement made in 15/1/2019! The announcement mentioned that PSIPTEK will only involve in construction of mill (in Lawas), refinery, port and storage (in Sipitang).
Meeting with Deputy Chief Minister of Sabah (very informative)
https://www.facebook.com/Madiustangau/posts/kumpulan-kedua-yang-menemui-saya-dari-syarikat-ttsj-trading-sdn-bhd-sebuah-syari/2009623669117971/
TTSJ issued share was only RM750,000 as at 31/5/2018! and increased to RM3million on 6/12/2018, a few days before TTSJ and its business advisor met Sabah leadership! The revenue for TTSJ as at 31/5/2018 was not high, only RM753k! But net profit was good i.e. RM213k! The revenue also doubled compare previous financial period! Based on this revenue, the trading co need to build a refinery?
The company claims that they are one of the top exporter of the palm olein! see the company website https://ttsjgroupmalaysia.com/about.php
Perhaps there are some other de factor boss backing the company? or there are some other trading arms within the group!
Another interesting party is AA strategic marketing inc s/b! in charge of the entire project management! 2 new directors were appointed on 2/12/2018! Ahmad Danial (10%) and Lam Jee Seng (90%)!
And no more news after January 2019?! One of the recent development is formation of a new company on 19/4/2019! TTSJ Beriwan Hijau Sdn Bhd! Mr M.S Athar Qureshi 70% and Mr Maripa Rangub 30%. Mr Maripa Langub is the supreme council member of Dayak DCCI! with experiences in oil palm plantation!
From the above development, most probably the palm oil mill will be started soon!? Personally opined the risk of PSIPTEK is relatively low as it does not involve in oil palm plantation (which will take sometime to mature) and does not run the palm oil mill and the palm oil refinery (margin for refinery is low!)! PSIPTEK only involves in the constructions of physicaly facilities!
As per JV, the construction work shall be completed within 5 years upon obtaining all approvals! RM2.1billion / 5 = RM420million x conservative net margin of 5% = RM21million? (reference CBIP NP is 12%), equivalent to about 5s per share? 5cent / share compare share price RM0.14 is the PE attractive enough?
and PE can be higher after factor in the following (2)?
2) APPOINTMENT OF 2 NEW EDs
On 31/5/2019! Substantial portion of PSIPTEK warrants changed hands off market! Acquires are Datuk Liew Kok Leong of ARBB (via Ukay One S/B) and Mr Chin Kok Foong of Blitz Tower Group (contractor and property developer)! Both of them appointed as ED then! On 14/6/2019, the group announce private placement of 10%! Are these signs of sideway listing? Is Datuk Liew going to replicate the same as happended on ARBB from Aug 2018?
Blitz Tower Sdn Bhd (65% by Mr Chin Kok Foong, 35% by Mr Chin Kok Hoong)'s share capital increased from RM500k to RM1millon on 30/4/2019! Related to CIDB G6 and G7? G7 with unlimited tender amount! Those interested may also check the Blitz Tower Development Sdn Bhd and other companies within Blitz Tower Group!
Possible Blitz Tower group to be injected into the PSIPTEK after it becomes G7? Construction made up 47% of revenue for YE2018! and PSIPTEKs involved in affordable housing and some other government projects! Net profit margin of Blitz Tower Develoipment Sdn Bhd are very much better than PSIPTEK! Possible Blitz helps to improve the bottom line as well?
What about the roles of Datuk Liew? Is he playing the most important roles in all these corporate transaction!I 3 IOT SEPCMs, C&M Renewal Energy Sdn Bhd and ERP for ARBB in less than a year! Similar to be happended on PSIPTEK?
Price of PSIPTEK share was highest at RM0.17 few days back...and closed at RM0.14 on Friday (15/6/2019)! Is PSIPTEK a good buy? NTA of the group was RM0.57 as at end of March 2019! Is it worth to buy? Why Foo family willing to sell the warrants?
3) Worry of repeating of what happended to other sideway listings
Many retailers made lossses due to some irresponsible sideway listers, as those retailers claimed! e.g. tattgiap/dynacia, VC and etc with high fluctuating share price! If I were those involved, I would definitely not to involve again! Nevertheless, are there differences between dynacia/VC and Datuk Liew kok Leong linked ARBB?(and now possible to be copied to PSIPTEK?).
There are some differences I opined. (1) injection of new business done relatively fast (2) financial figures were promising through continous good QTR reports (3) share price fluactuations were well controlled (4) manage to attract IBs to review and to issue a buy call (5) Datuk LKL only have 4.8% of ARBB share when he appoined at ED on 30/8! and in March 2019 he only has 9.3%! (6) and now he only acquire the PSIPTEK-WA instead of mother share!?
Risk of Datuk LKL conversion of ARBB-PA could have been factored in the ARBB share price! As someone with venture capitalist background, is he convert now before ARBB showing more promising QTR results? An IB even listed the scenario of full conversion, which I think unlikely in near future!
This is not a buy / sell recommendation!
WILL SHARE MY THOUGHT ABOUT THESE 2 GROUPS IN COMING POST!
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https://klse.i3investor.com/blogs/ChrisKho/210924.jsp
