Well said.

I think management is starting to panic now.

Somehow unofficial positive newsflows are starting to come online - Karoon FPSO redeployment, confirmation of no rights issue via The Star - probably coming from Armada management team off the record.

Too late now, Management. The market simply doesn't react anymore.

These EPF fund managers keep selling while EPF keeps buying.
Lol, they might as well do cross trade off the market.

take this opportunity to accumulate before 2 Nov budget and after that foreign investors come back.

don't worry, it will go up, give it some time.
share price has entered into dirt cheap zone and even the sellers felt not quite right selling now.

Shpok go eat up 0.41 pls

Not by me either, now wait 0.41.

Foreign funds buy back maybe, or some rich dude.

Now we all wait shpok to clear 0.40 haha

Bumi Armada has also confirmed that they will not do equity fundraising

Aberdeen is the foreign fund that has been dumping past few weeks? I see. Yeah, with a few positive news flow now, it’s difficult for them to justify dumping.

Not selling

https://www.upstreamonline.com/hardcopy/1614852/bumi-armada-set-to-win-karoon-fpso-tender

Armada set to win Karoon FPSO

Recommend strong SELL to all short term speculators, this is a downtrend stock and catching a falling knife will just get yourself stabbed here and there.

Recommend strong BUY to investors with holding power of at least 12-18 months.

Remb, if you can't hold 12-18 months, you should sell now while the share is fairly stable around RM0.4.

Save you all the time monitoring and panic attacks if it goes below RM0.4.

Seller's fatigue haha.

haha, that's a secret.

I'm still honoured that you're obsessed with me.

http://www.theedgemarkets.com/article/latest-development-bumi-armadas-legal-case-seen-positive

Patience. Announcement probably coming soon on whether the debt that is due in Oct 2018 is refinanced.

Once the debt is refinanced, budget uncertainty announced, then QR will be announced end Nov.

you won't be panic if your holding period is 18 months
super panic for those with short holding period, playing contra (T+4 time bomb....tik tok tik tok...)

Agree - the reversion from a big loss in Q2 2018 to a positive in Q3 2018 will give a big boost to the share price.

Also, post budget, I think most institutional investors and foreign funds will start to think "it's not that bad actually" and start coming back once uncertainty is gone.

By year end, you also start to see window dressing, no way funds going to let Armada to be reported as RM0.95 in Q1/Q2 and then RM0.40 year end.

Armada, after all, has been on a downtrend for more than 2 weeks.

If your strategy is to buy and sell for an opportunistic rebound of a few %, the odds are stacked against you.

But if you're buying it to keep for at least 4 - 6 quarters, the odds are extremely in your favor.

that's all i can say.

I'm most likely wrong if the holding period is a few hours or a few days.
I'm pretty sure I'm right for a holding period of 18 months.

the bull run is starting

For the fun of it i just took a look at superbull11's PRESBHD buy call yesterday, it was a fantastic call to buy at RM0.41 at around 2.30pm yesterday. It's currently at RM0.51. Unfortunately I don't really follow that stock. Credit given where it's due - superbull11 hope you made lots of money from that stock. goodluck.

Yum, collected more at 0.395, didn't manage to buy at 0.39 :(

That was yesterday’s closing queue, not this morning’s opening.

Highlight from Jefferies Report (TP RM0.95)

"BAB is entitled to a portion of the proceeds of the sale of the crude oil
amounting to USD8.5mil (RM35mil) as partial settlement of the outstanding amounts
due from EPNL for the bareboat charter and operations and maintenance (O&M) of
the vessel.

We have previously excluded contributions from Armada Perdana in our earnings
estimates and sum-of-the-parts valuation.

Furthermore, the asset has been fully depreciated and debt for this project has been
fully paid off."

Simple math:
The RM35m is pure bonus to Armada's FY2018 net profit.
At 10x P/E, it should add RM350m to Armada's market cap, equivalent to around RM0.07.
Instead, Armada's price declined by RM0.01 instead due to bearish market sentiment.

Sentiment > Fundamentals at its best.

Pulled this out from Bloomberg - summary of latest TP released yesterday & today (22 / 23 Oct):

Jefferies - RM0.95
Ambank - RM0.90
Kenanga - RM0.55
Affin Hwang - RM0.66
Public Bank - RM0.69
JF Apex - RM0.66
UOB - RM0.66

Average: RM0.72 (+81%)

haha superbull11, I'm honoured that you're obsessed with me.

Buy, only if you can hold 18 months.

If you look to buy now and think to make a quick profit from sentiment rebound, don't bother, might as well go casino, play roulette and bet red or black. The odds are about the same.

Like a famous private equity investor Carlos Alberto Sicupira from 3G capital once said:

"Costs are like fingernails, they will keep growing and you have to cut them continuously."

Armada's fingernails now are like vampire grade.

Lol, I think Bumi Armada should hire me to run their business.

Armada makes around RM1.2 - 1.5bn in EBITDA a year based on current run-rate.

Use 100% of these to repay debt, the debt will clear in 8 years.

Can you imagine a beautiful balance sheet like that for an O&G company.

By that time, there will be no more interest expense and little depreciation, your EBITDA effectively becomes your PAT.

Assuming a PAT of 1.2bn in 8 years and an P/E of 10x and 8% WACC, the present value is around RM6.5bn, that translates to around RM1.30 per share.

It's a really simple strategy. We don't need a bloated management team with lots of white expats each taking hundreds of thousands if not millions ringgit salary. Cut all these jokers, trim down all the costs by 30-40%, and the market will reward the share price.

Buy, put aside for 18 months, probably at least double if not triple the investment.

I think TP of RM1.00-1.20 by 2020 is not unachievable. The trick is you must have holding power.

The O&G industry has seen a downturn since 2014, almost 5 years now. Oil price is already back to US$80. At this oil price, the default risk of Armada's client is very low because their cashflow is extremely strong and healthy.

If the banks are supportive of Armada's ventures at US$30-40 oil, before final acceptances, when the company is still making large losses, it's a no brainer to continue supporting the company when the fundamentals are so much stronger now.

So the question to every investor is:

Do you have what it takes to call the bluff on market's irrationality and overly bearish sentiment now?

great entry price at 0.41.

hold if it goes up, don't be tempted to sell when it moves to like 0.43, once past 0.45, the downtrend will be officially over and will reverse to uptrend.

budget 2019 has little impact on the business operations of Armada - unless PH government is stupid enough to raise corporate tax, which really affects everybody anyway.

thinking one step ahead, institutional investors, whether domestic or foreign, will want to rebalance their portfolio to stocks that are relatively shielded from government policy risks - that means business with majority of their earnings are derived from outside malaysia, business that are not heavily tied to government regulations, licensing requirements etc.

Armada fits this category.

Armada is so oversold that even under overall bearish market sentiment, it's the only green in my portfolio today together with Vitrox.

Think the price needs to stay around 0.4 - 0.43 for a while to consolidate, and for people to feel comfortable again to invest.

Yeah, doesn't make sense to issue RI at this price -

1) Can't raise a lot of money
2) Dilution will be too big
3) Armada has a large public float - 50%, shareholders approval is uncertain
4) Ananda Krishnan (with the India telco fiasco) and EPF may not want to support the RI.

That’s true too. Armada has many panic sellers that is very susceptible to weak sentiment.

Let’s recap:

1) All four final acceptances achieved
2) Oil price at USD80
3) TGT-1 extension of RM1.1bn
4) RM2.5bn revenue and highly profitable business except non cash impairment in Q2 2018

Did investors overreact and tank Armada down from 95 cents in May to 41 cents today just because of a bad quarter? I would think so.

Armada has become a sentiment stock now. Thing with sentiment, unlike fundamentals, is that they always change. It may seem bearish in the last few weeks. But before you know it, everyone is bullish again. The cycle repeats.

shpok I don’t know the share price will go down for sure when I sold at around.44 but I sold around 3m shares, about the same as EPF and that’s also around the time they announced 11MP with a lot of uncertainty.

Then I bought back after another round of panic.

Also @ 25 cents only will yield RM1.45bn with 1-1 rights, or only USD350m. So you’re saying that the star article and UOB research that came out today confirming no RI is fake?

Selling a partial stake in any FPSO assets, or drawing down the Euro MTN of USD1.5bn available facility, will be so much easier and faster with certainty for Armada, instead of having to go to a shareholders vote with 50% public float.

Logic just doesn’t quick click here. Feel free to enlighten me. Thanks.

Previously you mentioned RI @ 35 cents, now you mentioned RI @ 25 cents?

Superbull11 I thought you said you have insider news that they will do RI @ 35 cents - where is it now?

I think debt restructuring from ST to LT is 100% going to happen. Just look at the past 8 quarters ST debt level u would notice that it spiked in Q3 2017 due to kraken final acceptance delay. Now final acceptance secured, so just need to reclassify in Q3 2018 report. I am 100% sure that will happen.

BA management and board have already pointed this out a year ago in 2017 annual report that this restructuring will happen this year.

Investors are just spooked because of this short term liquidity crunch - many institutional funds probably have a mandate that do not allow them to touch stocks where their current liabilities are higher than current assets to avoid liquidity issues - which is only temporary for Armada until Q3 2018.

So, take this opportunity to BUY when others are panic selling / depressed selling because of a liquidity risk factor that has been known more than a year in advance and a refinancing plan is already in place.

I’m going to take advantage of this big time and hold 12-18 months.

However, if you don’t have holding power or time on your side, avoid this stock.

@getonwithit - nope. Just on mother share.

I have sold all around 0.44 few days ago.
and then repurchased around 0.41- 42.
Saved close to 10% of capital.

It'll be very difficult to predict when is the bottom - probably more luck than anything.

But at this price point, how low further can it go, given now that it's been clarified in the star article that there will be no cash call / rights issue?

Timing wise, understandable that everyone wants to wait until Nov 2 Budget.
However, I think it'll be difficult to make any supernormal profits if everyone is doing the same thing.

Over the next 2 weeks,

If it goes down, I'll opportunistically try to cut loss and lower my entry cost.

If it goes up, I'll just hold for a long long time until i sense that there is irrational exuberance.

The big rebound will eventually come - it could be this week, next week, post budget, next 6 months.

Yeah, I've been saying for months, during the next AGM, we should collectively all vote a big fat NO to the multi million ringgit incentive plans for management who steered the company and share price to shit with their poor communication with investors.

The investor relations team especially is doing a very poor job.