Read the Maybank article again,it said rm5.0 is undemanding valuation at FY20E PER 7.8x Think carefully in 2020 will the market give Mfcb PER 7.8x or the more reasonable PER 12-15x At PER12x it will be rm7.69 and 15x will be rm9.61
I guess that is the normal practice of Investment Bank when come to PE, as for MFCB the hydro power plant is not yet 100% complete. Besides the estimated earning is just a projection, so they normally will give low PE for that, however once the hydro power plant is up & running , and the earning is actually match the projection, I am sure that they will raise the PE.
For reference, Malakof current PE is stand around 14.
Hi KL teoh I look at your Hydro power plant estimation earlier. There is one assumption you made that I think should be amended. The capacity factor of 80% is very high. I would put it around 40 to 55% max. Coal power plants are usually used as base load supply. They cannot ramp up and down in short notice compared to hydo and even then I think 75% for coal power is already an optimistic figure.
hi KL Tneoh Capacity factor is differnt from output efficiency. Real world cumulative data for hydro averages 40% with Brazil highest and China about 40%. Anyway hydo power have one of the lowest operating cost among the alternatives.
A lot china hydro power can archive above 80%. Range around 80 to 91%. For MFCB, i read some hydro power construction company research report say dry session is around 80% and wet session can archive around 90%. KL Tnoeh say 80 % is very reasonable and confirm many time by management. This is reason y MFCB planed use 260mw turbine not 240mw or 220 mw turbine. Actually a lot information can search in google.
From your comment i am sure you have read the feasibility study done for the project and take the capacity factor from there. OK Please go and check the published Hydroelectric capacity factors in the Vietnam and Laos government published statistic . You can google it.They have a lots of hydro power plants around the Mekong basin and dating back for more than 20 years. The average power capacity factors achieved for power plants above 200mw and larger is around 30 to 50%. A lot of feasibility studies reports are done in such a way so that the banker financing portion can be maximized. Bankers and investors need to be convinced. Its routine to overstate cashflow and returns assumption figure by 30 to 50% on a most cases. If you look at many malaysia privatized toll roads the figure can border on the ridiculous. But then this is another story. Please never ever take my words as gospel go and check n recheck the facts. It just so happen I am researching another company that is in the same industry . good night
@ 般若金刚 I was reading the same report years ago, and I personally asked the management about the estimated output. In fact one of the person in charge gave me the detail explanation, why the power generation output on DSH can achieve such a high rate.
Anyway, let keep the fingers cross, is the outcome will be matching what they had estimated.
Yes that report is paid by MFCB and not the independent Gov reports on Hydroelectric power in the Mekong region. Its better to see the Independent report that shows the various hydroelectric dams operating there and it details a lot of Dams of various capacities. Generally larger dams have better capacity factors. However the good thing about this MFCB dam is the low cost per MW compare with its peers.
I guess u hv to Google it yourself as I was not interested in hydro but doing some comparison n benchmarking electric power plants under differentt real world scenarios . Anyway I like to thank people like you to give feedback n opinions different than by own
I do not know how much the share will go up. But for me MFCB now still have potential to growth. Basic study, Laos have nothing to lose... Since they kick start Test run successful, share price proof the value of this counter.
@icwin - there are many senior and experienced experts here. The information doesn't come from google alone... 万事具备... the unpolished gem is time to shine soon :)
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lloydlim
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Posted by lloydlim > 2019-10-09 15:38 | Report Abuse
Dumb dumb hold until next year & laugh to de bank