In previous post, I highlighted the attractive area of INDUSTRIES INCORPORATED BERHAD (FACBIND, 2984). However, the latest annoucement slightly disappointed me. Although it appeared that the disposal will be completed soon (after approval from EGM), FACBIND only planned to
invest almost all the "Profits" into NEW BUSINESS*. In other words, no special dividend will be announced. This causes another uncertainty for me.
In a comparison with P&O's divestment that at least planned to allocates some portion for its shareholders, the uncertainty of FACBIND is higher than P&O, obviously.
It is very difficult for me to assess the intrinsic value of FACBIND in present situation. On one hand, based on its potential cash-in-hand level, this cannot be denied that today selling price is still quite attractive (that is why it once soared > 20%, I guess). On the other hand, future profitability is highly dependent on the use of the money (approximately RM1.57 cash per share).
Since my cash ratio is around 40% now, with 60% shares in hand (excluded any unrealised profits/loses), unless I can foreseen a very attractive deal during this critical moment, I think I rather to keep focusing on having a good night sleep.
Maybe I will miss another big fish again. Guess what, there are still many big fish in the "sea". So, why should I take unnecessary risk??
That's all for today. More fascinating articles and sharing will be updated from time to time in Xaivier Blog. So, you are welcome to subscribe our feed, look at our sitemap or simply visit our Homepage for latest sharing.
Written by: Xaivier Chia
invest almost all the "Profits" into NEW BUSINESS*. In other words, no special dividend will be announced. This causes another uncertainty for me.
In a comparison with P&O's divestment that at least planned to allocates some portion for its shareholders, the uncertainty of FACBIND is higher than P&O, obviously.
It is very difficult for me to assess the intrinsic value of FACBIND in present situation. On one hand, based on its potential cash-in-hand level, this cannot be denied that today selling price is still quite attractive (that is why it once soared > 20%, I guess). On the other hand, future profitability is highly dependent on the use of the money (approximately RM1.57 cash per share).
Since my cash ratio is around 40% now, with 60% shares in hand (excluded any unrealised profits/loses), unless I can foreseen a very attractive deal during this critical moment, I think I rather to keep focusing on having a good night sleep.
Maybe I will miss another big fish again. Guess what, there are still many big fish in the "sea". So, why should I take unnecessary risk??
That's all for today. More fascinating articles and sharing will be updated from time to time in Xaivier Blog. So, you are welcome to subscribe our feed, look at our sitemap or simply visit our Homepage for latest sharing.
Written by: Xaivier Chia
(P/S: The above sharing is solely based on personal insight. Please do not take it seriously. However, your valuable feedback are very welcome.)
Reference:
Section 3.2 of http://announcements.bursamalaysia.com/EDMS/subweb.nsf/all/2A48183A1E773CE748257B280023AB0D/$File/FACB.%20Circular.pdf
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