14 people like this.

46 comment(s). Last comment by Davidleong 2020-04-01 22:04

hng33

18,648 posts

Posted by hng33 > 2020-03-03 11:19 | Report Abuse

Well done! it reinforce jaks power profit expectation to deliver RM 221m TAX FREE NET PROFIT by comparing fair similar other plant in operation.

Posted by speedlikecy > 2020-03-03 11:20 | Report Abuse

thanks for the article

DK66

4,269 posts

Posted by DK66 > 2020-03-03 11:21 | Report Abuse

speedlikecy, you are welcome and thanks for your "like"

DK66

4,269 posts

Posted by DK66 > 2020-03-03 11:28 | Report Abuse

The valuation here is consistent with the average valuation derived in the article below;

Jaks Resources - A More Accurate And Reliable Average Valuation
https://klse.i3investor.com/blogs/Jaks%20resources/2020-02-16-story-h1483823173-Jaks_Resources_A_More_Accurate_And_Reliable_Average_Valuation.jsp

hng33

18,648 posts

Posted by hng33 > 2020-03-03 11:29 | Report Abuse

DK66, please notify OTB to use your figure above to seek confirmation with Jaks CEO when they have meeting next week. Thanks

DK66

4,269 posts

Posted by DK66 > 2020-03-03 11:36 | Report Abuse

Hng33, it is not advisable to place too much emphasis and reliance on the valuation derived in this article as the validity of the assumption used is highly debatable. It merely serves to prove that the power plants under BOT in Vietnam are highly profitable.

hng33

18,648 posts

Posted by hng33 > 2020-03-03 11:46 | Report Abuse

OK, hope OTB can publish too estimation derive from Jaks CEO expectation profit on IPP after meeting.

i3Value

612 posts

Posted by i3Value > 2020-03-03 12:02 | Report Abuse

DK, 221m or 295m is GP only isn't it? Still have to take into account local expenses and finance costs before calculating EPS

DK66

4,269 posts

Posted by DK66 > 2020-03-03 12:07 | Report Abuse

i3value, The project cost and financing structure is very similar to JHDP. The PATNCI is already the Net profit after tax.
-----------------
i3Value DK, 221m or 295m is GP only isn't it? Still have to take into account local expenses and finance costs before calculating EPS
03/03/2020 12:02 PM

Posted by SarifahSelinder > 2020-03-03 12:11 | Report Abuse

DK66

Quite influential IBs

Kena debunk PBB

Kindly do calculations klau Hai Duong IPP cuma only add 70 sen to JAKS how much is PAT of Hai Duong IPP at 30%?

i3Value

612 posts

Posted by i3Value > 2020-03-03 12:14 | Report Abuse

Yes, i understand you using PATNCI. But 221m/295m is PATNCI of the power plant, correct?

Local business? If assume local business no revenue and no direct cost, there still are malaysia office operating expenses and finance costs for Evolve Mall etc.

Posted by SarifahSelinder > 2020-03-03 12:22 | Report Abuse

Sarifah rasa adding jz 70 sen shd b more than easy to debunk


SarifahSelinder DK66 

Quite influential IBs 

Kena debunk PBB 

Kindly do calculations klau Hai Duong IPP cuma only add 70 sen to JAKS how much is PAT of Hai Duong IPP at 30%?

03/03/2020 12:11 PM

DK66

4,269 posts

Posted by DK66 > 2020-03-03 12:28 | Report Abuse

i3value, yes, it is only the power plant. Still need to consider local expenses in Malaysia

DK66

4,269 posts

Posted by DK66 > 2020-03-03 12:30 | Report Abuse

sarifah, I don't quite understand your 70 Sen. Could you elaborate?

Posted by SarifahSelinder > 2020-03-03 12:32 | Report Abuse

Kena debunk IBs

IBs jz come out wit some craps all ur 20 so blogs all neutralized

Posted by SarifahSelinder > 2020-03-03 12:35 | Report Abuse

Kan PBB ada apa tu Monte Carlo tu....

Posted by SarifahSelinder > 2020-03-03 12:42 | Report Abuse

How low is Hai Duong IPP PAT klau jz add 70 sen only?

DK66

4,269 posts

Posted by DK66 > 2020-03-03 13:05 | Report Abuse

ok. let me do some calculations

Posted by SarifahSelinder > 2020-03-03 13:08 | Report Abuse

Tqvm

Posted by dailyklse2010 > 2020-03-03 13:11 | Report Abuse

Thanks DK66

DK66

4,269 posts

Posted by DK66 > 2020-03-03 13:55 | Report Abuse

Sarifah,

If JHDP 30% ownership is only worth RM0.70 to Jaks, and if the 70 sen is derived using PE of 10, it means it is only expecting 7 sen or RM45m annual profit from JHDP. Hence, JHDP will only earn RM152m (USD36m) a year, and total of USD900m for 25 years

In other words, after investing USD1870m in JHDP, it will only generate a total net cash flow of USD2770m (1870+900) for 25 years. This is a total of merely 48% return over 25 years, equivalent to a compound return of about 1.5%. Is this a good investment decision ?

liewtz06

356 posts

Posted by liewtz06 > 2020-03-03 15:02 | Report Abuse

Hi DK66, thanks much for sharing. just 1 question, from what you've mentioned above 100% Vinh Tan 1 PAT = RMB553 / 45% = RMB1,230m should it be divided by 55% instead of 45%? since the ownership you've mentioned above is 55%.

liewtz06

356 posts

Posted by liewtz06 > 2020-03-03 15:05 | Report Abuse

Also, after the projection of 12 months PATNCI by /9 x 12 using 9 months results, why add another 53M which made the calculation based on 12 + 1 = 13 month? Kindly seek your clarification.... thanks!

DK66

4,269 posts

Posted by DK66 > 2020-03-03 15:10 | Report Abuse

liewtz06, because the RMB553m is the portion attributable to the 45% NCI (100%-55%). I have to add back the PATNCI of 2018 because the prorate amount of RMB497m represents the INCREASE in PATNCI.


-----------------------
liewtz06 Hi DK66, thanks much for sharing. just 1 question, from what you've mentioned above 100% Vinh Tan 1 PAT = RMB553 / 45% = RMB1,230m should it be divided by 55% instead of 45%? since the ownership you've mentioned above is 55%.
03/03/2020 3:02 PM

liewtz06 Also, after the projection of 12 months PATNCI by /9 x 12 using 9 months results, why add another 53M which made the calculation based on 12 + 1 = 13 month? Kindly seek your clarification.... thanks!
03/03/2020 3:05 PM

OTB

9,967 posts

Posted by OTB > 2020-03-03 15:37 | Report Abuse

Posted by hng33 > Mar 3, 2020 11:29 AM | Report Abuse

DK66, please notify OTB to use your figure above to seek confirmation with Jaks CEO when they have meeting next week. Thanks

Posted by hng33 > Mar 3, 2020 11:46 AM | Report Abuse

OK, hope OTB can publish too estimation derive from Jaks CEO expectation profit on IPP after meeting.
-----------------------
Ans:
I had read all DK66's reports until I can memorize them.
I carry all the notes to attend the meeting.
Please note that I am a detail person, no worry.
Thank you.

probability

14,175 posts

Posted by probability > 2020-03-03 15:38 | Report Abuse

above derivations appears highly consistent with Mong duong performance and also based on IRR and payback estimation given by Jaks management earlier.

Its a 'Jackpot stock' which the market yet to appreciate despite so close to power generation...

we cant predict market's behaviour in the near term.....but 'time' is an inevitable force we can count on to push the market in the right direction.

hng33

18,648 posts

Posted by hng33 > 2020-03-03 17:40 | Report Abuse

Thanks OTB, please present DK66 hard work to Jaks CEO during meeting and update the outcome here. Thank you very much.

probability

14,175 posts

Posted by probability > 2020-03-03 20:39 | Report Abuse

@liewtz06, i think you can see it this way from the below data:
.......................................................

Vinh Tan 1 is 55% owned by China Southern Power Grid

The PATNCI of China Southern Power Grid for 9 months ended 30th Sept 2019 was RMB 1,127m ( 9 months 2018 : RMB754m)

The PATNCI of China Southern Power Grid for 2018 which is attributable to Vinh Tan 1 was RMB56m
.......................................................

PATNCI of China Southern Power Grid for 9 months ended 30-09-2019
RMB 1,127m...(1)


PATNCI of China Southern Power Grid for the last 9 months in 2018 ended 31-12-2018:
RMB 754m

Deduct the RM45m contributed by Vinh Tan 1 at end of 2018
RMB 709m.....(2)


As such, (2) is without Vinh Tan 1 contribution and (1) is with Vinh Tan 1 contribution for a 9 months period (with +/- potential contribution from others which is assumed zero - which is a fair neutral assumption).

The changes , i,e difference between (2) & (1) is then the PATNCI from Vinh Tan 1 contribution for 9 months = RMB 418m

12 months prorated contribution would be = RMB 557m

Since PATNCI holds 45% stakes, at 100% stakes Vinh Tan 1 PAT would be:
= (100/45)*(RMB 557m)
= RMB 1238m
= RM 743m

at JAKS 30% and 40% stakes it would be RM 222m and RM 297m respectively.


correct if my understanding is wrong DK66 :)

DK66

4,269 posts

Posted by DK66 > 2020-03-03 21:08 | Report Abuse

Probability, your understanding is correct. Thank you for helping to explain.

OTB

9,967 posts

Posted by OTB > 2020-03-04 18:47 | Report Abuse

Dear DK66,

I wish to show you the below calculation how I can get RM 248 million.

The cumulative power sales of Vinh Tan 1 were 8.194 billion kwh based on annual 7,238 utilization hours.

Since Hai Duong power plant is the same spec as Vinh Tan 1, I will assume same cumulative power sales were 8.194 billion kwh.
Profit margin is USD 0.024 (2.4 USD cents).
USD to RM conversion is 4.20.
Jaks owns 30% stake.

Calculation
= 8,194 * 0.024 * 4.20 * 30% = RM 248 million.
This profit is tax free.
EPS = 248/651 = 0.38
If PER = 10, the target price is 3.80 in 2021.
If PER = 15, the target price is 5.70 in 2021.

Thank you.

DK66

4,269 posts

Posted by DK66 > 2020-03-04 22:50 | Report Abuse

Dear OTB, Noted with thanks.

Flintstones

1,762 posts

Posted by Flintstones > 2020-03-04 23:11 | Report Abuse

If this counter is so good why no institutional funds sai lang?

probability

14,175 posts

Posted by probability > 2020-03-04 23:19 | Report Abuse

they are not smarter than you Flintstones - to get convinced on the earnings projected...

OTB

9,967 posts

Posted by OTB > 2020-03-04 23:23 | Report Abuse

According to statistic, 90% of investors lost money in stock market.
10% of investors made money in stock market.
It is understood that more people will talk bad about most of the stocks.

edkfc

274 posts

Posted by edkfc > 2020-03-05 00:02 | Report Abuse

Hi Dk...the estimated earning of Vinh Tan1 from the other article ( Average valuation of Jaks Hai Duong Power Plant )
is rm287m to rm290M (30 to 40%) . Is the assumption different here or i miss out something ? Tks

DK66

4,269 posts

Posted by DK66 > 2020-03-05 08:43 | Report Abuse

Edkfc, although the valuations derived in "Jaks Resources - Higher Expected Investment Returns from JHDP ?" and this article are both using data from Vinh Tan 1. However, different bases and assumptions were used . The former combines data from vietnam government, management guidance and Vinh Tan 1 utilization hours to arrive at the valuation. This article extract Vinh Tan 1 results from abbreviated results of its holding company by assuming the increase in profit attributable to NCI in 2019 was entirely pertaining to Vinh Tan 1.

Even though wild assumptions were made in both cases, the results were not vastly different. This suggests that Power plants under Vietnam BOT contracts are very lucrative.

edkfc

274 posts

Posted by edkfc > 2020-03-05 12:05 | Report Abuse

Tks DK...the BOT contracts is indeed extremely lucrative. We were told during last yr AGM that the Viet government would not issue such lucrative contract anymore ! Jaks and their investors are so fortunate.

DK66

4,269 posts

Posted by DK66 > 2020-03-05 14:32 | Report Abuse

you are welcome

DK66

4,269 posts

Posted by DK66 > 2020-03-05 19:13 | Report Abuse

Yes, they all have the same BOT contracts and their PPAs are very similar, if not identical. By right, Mong Dong II should be a closer resemblance to Jaks as their BOT and PPAs were the first 2 signed and Vinh Tan was sealed a year later. However, both Vinh Tan 1 and JHDP are using chinese technologies while Mong Duong II is using American technology.

Chinese thermal power technology has out grown Western technology. Mong Duong II was operating at 33-34% efficiency whilst chinese technology can achieve 36-38% efficiency for sub-critical design. As I have said, plant efficiency is an important determinant of profitability.

Therefore, I would say Vinh Tan 1 would be a closer match for JHDP.

Hope I have explained well.

-----------------
newbie8080 @DK66
This blog still apply if Vinh Tan 1 is closest?

https://klse.i3investor.com/blogs/Jaks%20resources/2019-04-29-story204...
05/03/2020 6:39 PM

DK66

4,269 posts

Posted by DK66 > 2020-03-05 19:17 | Report Abuse

The article on Mong Duong II, however, revealed an important information about the capacity payment. I would expect all the 3 power plants to have very similar capacity payment which is not affected by operating efficiency. However, energy payment is highly dependent on plant load factor, plant availability, and plant efficiency.

uptrending

1,827 posts

Posted by uptrending > 2020-03-06 16:10 | Report Abuse

DK

The net profit already net off Finance Charges, Admin and Operation, etc?

DK66

4,269 posts

Posted by DK66 > 2020-03-06 16:27 | Report Abuse

Uptrending, yes, it is the net profit after tax.

uptrending

1,827 posts

Posted by uptrending > 2020-03-08 16:23 | Report Abuse

Opportunity to buy while Covid-19 is still spreading and virusing the market. :)

Davidleong

154 posts

Posted by Davidleong > 2020-04-01 22:03 | Report Abuse

DK 66, Have you research this Banten power plant (indonesia) before?

In 2013, power company PT Lestari Banten Energi (part of the Genting group) was
seeking to finance a USD 998m project to build a 660MW coal-fired power plant
in Banten, West Java, Indonesia. The power plant (“Banten”) is due to commence
production in 2017, and leverages best-in-class technology combined with high energy
efficiency. The company signed a 25-year power purchase agreement (PPA) with state
offtaker PT PLN Persero (PLN) to purchase 100% of the project output.

Davidleong

154 posts

Posted by Davidleong > 2020-04-01 22:04 | Report Abuse

Also operate on BTO programme

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