Asiatic Group

Re: Asiatic Group

Postby Aspellian » Mon Jun 23, 2008 5:07 pm

Price movement of Asiatic up slightly to 13.5cents.
recent announcement on its 0.75 cents of dividends ~ 5.6% dividend yield at 13.5cents. Book closure on 8th Aug 2008. Typical SME Chinese management - always on a lookout for auspicious dates like the Olympics.

http://info.sgx.com/webcorannc.nsf/0357 ... enDocument

To balance things up and admist the rosy picture, there's further share dilution from the convertible bonds.
http://info.sgx.com/webcorannc.nsf/0357 ... enDocument

- 4.3m shares converted at 9.27 cents.

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Re: Asiatic Group

Postby winston » Thu Jun 26, 2008 9:11 am

Asiatic Group - Singapore power firm Asiatic Group said it won a power supply contract in Cambodia worth potentially $475 million over a 99-year period.
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Re: Asiatic Group

Postby Aspellian » Thu Jun 26, 2008 9:35 am

winston wrote:Asiatic Group - Singapore power firm Asiatic Group said it won a power supply contract in Cambodia worth potentially $475 million over a 99-year period.


That explains for recent price hike.
the number looks big... (must be the work of IR firms) but each year only US$4.75m ~ S$6.7m. Revenue of S$3- S$4m will be recognised only in FY09.

Expect to see more share dilution, debt and interest expense in the years to come. But its interesting to see when the company becomes a true cashflow company....

99 years, - a company u can hold for the next generation??? :D

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Re: Asiatic Group

Postby winston » Tue Jul 29, 2008 12:01 am

Not vested.

From Business Times:-

Asiatic does itself disservice
By CHEW XIANG

A COMPANY - with market cap at just S$30 million - says it has won a deal worth up to US$475 million over 99 years, or US$4.8 million a year.


The market barely noticed - trading volume increased slightly, but the share price still hovered around the 13-cent mark.

It's easy to raise an eyebrow at energy and fire protection equipment firm Asiatic Group, the S$30 million company that made such an announcement on June 25. The headline figure is a massive 22 times the company's market cap. Put another way, that's like SingTel saying they've secured a $1.3 trillion contract. (Just to be safe - they haven't.)

How did Asiatic figure their way to that enormous sum? According to management, inflation protection clauses essentially balance the discount factor applied to future revenue flows, which allows them to simply multiply 4.8 by 99, without having to give a heavy discount to money received in later time periods.

But a discount rate involves more than just inflation - it's also an estimate of the uncertainty of future money flows. That means it should include some element of the project's risk - of which there are many.

For one, the contract was secured in Cambodia - a country that only last year received its first credit ratings for its debt. Even then, the string of B2s, Bs and B pluses it got puts it considerably below investment grade. A sum of US$4.8 million a hundred years from now is just US$38,000 today when discounted at 5 per cent per year. Most advisers would put Cambodia's risk at a lot more than 5 per cent.

And second, the deal was to supply power to a special economic zone. But it's hard to think of any zone that can survive 99 years without major change. The power plant that will be built to supply the electricity - an initial five megawatts, moving on to 10 megawatts in its second year of operations - definitely won't be around in the year 2107. It will have to be replaced several times over, and that's assuming no catastrophe or unforeseen events happen in the interim. Recall that less than 30 years ago, Cambodia was mired in war and famine.

So what the company should have done, but didn't, was to have used a much more conservative discount rate to reckon the anticipated revenues from the deal. To be fair, the company said that the deal was 'potentially' worth US$475 million, but that seems no more than a fig leaf to keep the company on the right side of regulators.

Asiatic probably should not have even mentioned such an optimistic figure at all. Perhaps it felt a need to stand out from the crowd. Only last year, Asiatic hired an investor relations firm, Financial PR, to promote its stock, before recently switching to another firm. But despite the professional advice these firms have no doubt given it, the company's press release came with little or no discussion of the many risk factors that must exist in the business. It preferred instead to talk up the positives. For small companies, the temptation is to shout ever louder to attract much-needed attention from analysts, investors and the media.

But by doing so, Asiatic actually does itself a disservice. It sets the company up as an object of disbelief. Worse, it bolsters a cynical attitude towards its corporate announcements. Investors will imagine the worse - or simply ignore the stock.

That may already have happened. The market barely noticed the June 25 announcement - trading volume increased slightly, but the share price still hovered around the 13-cent mark. Recent trading volume has been lacklustre.

That's a pity. Asiatic, going by recent results, is actually a profitable and strongly growing company. For its latest financial year, net profit almost doubled to S$2.7 million and revenue jumped 67 per cent to S$44.6 million, on much stronger contributions from its quickly expanding power generation business in Indochina.


The only caveat appears to be an outstanding convertible bond programme that resembles 'toxic' bonds - bonds that have the tendency to drive a company's share price down. But Asiatic has a strong cash position and its recently announced investment in a hydroelectric power plant in Vietnam appears to hold much promise too.

It's a shame if all this got obscured by the mega million murk.
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Re: Asiatic Group

Postby behappyalways » Sun May 13, 2018 9:18 am

Dissenting minority shareholder moves to stir up Asiatic Group, says will issue open letter on May 9
https://www.theedgesingapore.com/dissen ... tter-may-9
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Re: Asiatic Group

Postby behappyalways » Thu Jul 19, 2018 2:26 pm

Second-largest shareholder of Asiatic sends letter to company’s sponsor
https://www.theedgesingapore.com/second ... 9s-sponsor
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Re: Asiatic Group

Postby behappyalways » Mon Jul 23, 2018 1:41 pm

Asiatic Group moves to sue dissenting minority shareholder Jerry Low for defamation
https://www.theedgesingapore.com/asiati ... defamation
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Re: Asiatic Group

Postby behappyalways » Tue Jul 24, 2018 2:43 pm

Asiatic minority shareholder Jerry Low hit with second defamation claim from executive directors
https://www.theedgesingapore.com/asiati ... -directors
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Re: Asiatic Group

Postby behappyalways » Sat Nov 21, 2020 4:46 pm

Asiatic Group's subsidiaries commence arbitration proceedings against Phnom Penh Special Economic Zone Plc for US$14.4 mil
https://www.theedgesingapore.com/news/c ... phnom-penh
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Re: Asiatic Group

Postby behappyalways » Mon Apr 03, 2023 9:43 am

Asiatic Group plans rights issue, mulls new energy-saving business as existing power generating ventures under strain
https://www.theedgesingapore.com/news/e ... ting-power
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