Posted by optimusx8 > 2014-05-29 12:43 | Report Abuse

good buy for ijm means bad sell for silk, simple as that.

wait t3 t4 u can see it sinking to 82c

Posted by lee9fold > 2014-05-29 12:48 | Report Abuse

if didnt drop to 82c then optimus is a noob?

Posted by optimusx8 > 2014-05-29 12:50 |

Post removed.Why?

Posted by lee9fold > 2014-05-29 13:00 | Report Abuse

yea...very irritating indeed :D

Posted by focuz > May 29, 2014 12:18 AM | Report Abuse

@LTInvestor: You can stand on your ground.

Is it coincidence or what, I have seen many times a blogger who starts with handle prefix OPTIMUS would come dropping by any upswing counter and does he/her very best to disparage and belittle. So just brush it off like a fly over your shoulder. I won't say that it is not irritating, VERY irritating indeed.

Posted by sheep > 2014-05-29 15:37 | Report Abuse

if dont go up today, sure down tomorrow. push up ah...

Posted by rqsh > 2014-05-29 23:17 | Report Abuse

Will be uptrend after some profit taking today. TOMORROW TAKEOFF AT LEAST 0.95 TO 0.99. gOOD LUCK.

Posted by sheep > 2014-05-30 00:34 | Report Abuse

friday will be in tight range. T+3 on monday. 47 millions shares traded. most caught at 0.92 - 0.935

Posted by lee9fold > 2014-05-30 00:35 | Report Abuse

we shall see...i believe price shall dip abit first b4 resume uptrend...good chance to buy in dips :D

Posted by sheep > 2014-05-30 09:48 | Report Abuse

sell in may ..go away....come after germany wins the world cup

Posted by sosfinance > 2014-05-30 10:21 | Report Abuse

OSV biz remain = say around RM350m, the only different, earlier, the analyst gives a NPV value of the Silk of about RM400m. Now, if the sale is completed, instead of holding a cash flow that eventually gives an NPV of RM400m (over the next 27 years), it got the NPV cash today. So, SILK Holding will not enjoy the slow incremental net cash flow for next 30 years.

Original
OSV biz + Toll biz = 350 + 400 = 750

Revised
OSV biz + CASH = 350 + 400 = 750

So, actually the question here is, it it better to hold a toll road (slow net inflow for next 27 years) or hold CASH.

If CASH,
a. Say they pay back a loan of 8.0% p.a., the additional earnings before tax will be about RM32m.

b. If, the company used the cash to invest in OSV or other biz that gives a return of >12% p.a., then, of course, this alternative is better.

So, the question is what are they going to use the extra cash for. We will need to review the finalised SPA. At this point of time, the valuation remain at about RM750m and the market cap it only RM440m, upside of 70% or value at about RM1.30-1.50. Maintain buy.

Posted by sosfinance > 2014-05-30 10:36 | Report Abuse

Correction, toll has 23 year remaining. Analyst used discounting rate of 9.2% to derive NPV of RM389m. Should wait for the finalised SPA to reevaluate the position. Until then, 90sen, is still undervalued. Analyst mentioned, majority of the OSVs are contracted for long term (5 years), some 3 years. Hence, profits for next 2-3 years is sustainable.

Posted by lee9fold > 2014-05-30 10:56 | Report Abuse

sos...thx alot for yr analysis...like!

Posted by bovun2014 > 2014-05-30 11:11 | Report Abuse

SIB have 21 supply vessels. One OSV can generate 22 mil with 2 yr contracts as per recently secured with Carigali Hess. Imagine with full swings, SIB can easily generate revenue 200 mil business. Now only wait for SIB management to announce special dividend to boost up SIB to another new high.

Posted by sosfinance > 2014-05-30 11:26 | Report Abuse

1. SILK Holdings Berhad is selling 100% equity of SILK Sdn Bhd for RM398m. One assumption is that, in the SILK Sdn Bhd, all loans are included. However, bear in mind, SILK Holdings Berhad also has ICULS issued, that may be dilute the shareholding of SILK Holding Berhad. (take note)

2. The acquisition of 4 OSVs of 49% definitely is a good deal.

Posted by sunztzhe > 2014-05-30 12:07 | Report Abuse

O&G OSV theme play is a bit overplayed now. Supply of OSV is more than PETRONAS Demand for OSV as stated by PETRONAS CEO. Gross Margins overtime will go south. Gross margins overseas may not be as lucrative as PETRONAS rates.

Posted by Stock Operator > 2014-05-30 15:31 | Report Abuse

heard it will shoot up to 2 bucks

Posted by lee9fold > 2014-05-30 15:32 | Report Abuse

u heard from?

Posted by eddyng3300 > 2014-05-30 23:27 | Report Abuse

Of course la, every time price go up the target price will also go up. If not who will buy.

Posted by sosfinance > 2014-06-01 23:03 | Report Abuse

MIB wrote an article on SILK in The Edge this week. However, I believe, the fair value of this company should be around RM1.20 to RM1.50. Earnings from OSVs and savings from interest expenses, should have a recurring earnings of more than RM80m in the next 2-3 years.

Posted by sosfinance > 2014-06-02 18:39 | Report Abuse

Average SILK's oil and gas sector, the PBT is about RM40m (19 vessels for FY2013).

For FY 2014, additional earnings from:

a) SILK bought 49% in 4 OSVs and add 2 more OSVs to become 21 vessels.

b) Sale of SILK for RM400m cash, can bring in earnings if used to repay debt, and

c) sale of equity in SILK Highway SB, losses from the toll is also no longer need to be consolidated (FY2013 is about RM16m).

So far, analysts have not work out the new earnings based on the above, it could be very significant. Using Perdana and Alam, PE of 13 and 12x, or market cap of RM1.4b and RM1.2b, I believe SILK can go above RM1.0b to RM1.2b.

Posted by sklyte > 2014-06-02 19:41 | Report Abuse

And last time i said silk is damn cheap u said fair value, haha, bro, ijm up so much after announcement

They have 700m diluted shares now, this business can worth 1b i think so too, 1000/700 work it out u will know they potentially worth 1.30-1.40

Posted by rqsh > 2014-06-02 21:41 | Report Abuse

Lets celebrate tomorrow the share break the 1.00+++ Buy now dont miss the golden chance. Good Luck.

Posted by focuz > 2014-06-02 23:44 | Report Abuse

PRIVATE PLACEMENT OF UP TO 30,000,000 NEW ORDINARY SHARES OF RM0.25 EACH IN SHB (“PLACEMENT SHARES”), REPRESENTING UP TO APPROXIMATELY 6.2% OF THE ISSUED AND PAID-UP SHARE CAPITAL OF SHB - Completed.

I expected with the new placement shares it's price would drop before up. Although got more moni but new shares wud hv diluted the share price. Today has been up & up. Can somebody explain the logic, up & up?

Posted by sheep > 2014-06-03 01:29 | Report Abuse

They push up to sell mah. Over value n overdo liow. Sell on strength. If not you die kaw kaw. I sold some at above 0.92. Wakaka

Posted by johnkiew > 2014-06-03 10:36 | Report Abuse

Silk in transformation, whoever looking this shares should focus on OSV, you may use ICON as SILK peer. Stay focus on the future business and monitor the transaction of highway between IJM.

Posted by focuz > 2014-06-03 11:00 | Report Abuse

Expected tat transact wit IJM close to complete share price up again. Wud ICON take biz away from SILK? Wats different? ICON got govt links.

Posted by johnkiew > 2014-06-03 11:56 | Report Abuse

ICON have 32 vessels with average 5 years age, the largest OSV provider. SILK with 23 vessels, both have future growth prospect in South China Sea (the future oil coast).

Bear in mind 80% of SILK revenue from OSV business. Disposal of SILK highway giving the financial capability for SILK to expand in OSV services.

Posted by focuz > 2014-06-03 12:22 | Report Abuse

@JK: thks.

Both comp's got own strength, i'm sure. Tat's y I think it is a strategic move by SILK to sell the hi/way. Mgmt think tat is not their strength. Some had said stupid sell.

Posted by johnkiew > 2014-06-03 14:43 | Report Abuse

The highway might not be sold in ideal price, but it giving opportunity for SILK to released its book. I view as strategic move from management. We will want to see how its go.

Posted by Joel > 2014-06-03 16:36 | Report Abuse

I personaaly think that Silkhld not suppose to sell kajang highways to IJM
simply bcos the trafic vol is increasing in future.
Semenyih and kajang areas is going to boost by these 2013-2017.

Posted by sunztzhe > 2014-06-03 23:50 | Report Abuse

Selling a hidden gem where the business fundamental will improve significantly in the future years and focusing investments in OSV assets where the business fundamental will for sure deteriorate in the future years..
Does this make any strategic business sense?

Posted by focuz > 2014-06-04 00:57 | Report Abuse

Posted by sosfinance > Jun 2, 2014 06:39 PM
c) sale of equity in SILK Highway SB, losses from the toll is also no longer need to be consolidated (FY2013 is about RM16m).

I knw tat usage on the SILK h/w is still not high. As sosfinance had pointed out, losses. Which indicates mgmt. wants to show a clean book. Put it tis way - some people like the land, some people like the sea.

I speculate & I emphasise wild speculation - some form of merger is in the making... take TGOFFS isn't it getting interesting. Some people had said, "Empty shell company."

Posted by johnkiew > 2014-06-04 09:23 | Report Abuse

Strategic move by management; focus on 80% revenue OSV business rather then 20% highway cash cow.

OSV oversupply rise concern, and that is the point we should look at ICON. But, if the OSV industry is oversupply, why will ICON go listing now (by spending 166.2 m for expansion on vessel)? And why SILK named as highway and core business in OSV?

PETRONAS CEO speak may be a political sound, it could be tender going in March this year.

Posted by johnkiew > 2014-06-04 09:35 | Report Abuse

OSV Malaysia:

http://www.might.org.my/en/Event%20Documents/2%20-%20OSV%20Sector%20Malaysia%20-Capt.%20Tasripin.pdf


http://www.thestar.com.my/Business/Business-News/2014/03/08/Bigger-OSV-operators-spared-Analyts-say-they-are-likely-to-maintain-their-margins-with-charter-rates/

Industry at risk?

Saturday March 8, 2014

Analysts say there is no cause for panic, as most contracts of local listed companies are already locked down and most of their chartered vessels are not at risk.

“Over the near-term, the contracts of most OSV operators are not up for renewal. The bulk of these contracts are fairly new, having been awarded in the middle to the end of last year. These contracts also typically have a five-year lifespan,” says MIDF O&G analyst Aaron Tan.

Another analyst says as most of these contracts are awarded by reputable oil companies like Petronas, Shell and Petrofac, the risk of rates being readjusted downwards has been further minimised.

Tan adds that most of the OSV-listed companies, such as SapuraKencana Petroleum Bhd and Bumi Armada, own mid-to-high-end OSVs, which have less supply in the market. These players will be able to maintain their margins.

It is the players who own the lower-end vessels, such as smaller AHTS vessels and tug boats, which will see their future margins being affected.

“There are many such small vessels in the market. This is especially apparent for those tugboats which cost around US$15mil to US$20mil (RM48mil to RM64mil) to construct. However, for high-end vessels like Bumi Armada’s floating production, storage and offloading vessels which cost hundreds of millions of ringgit, there is no issue of oversupply,” explains Tan.

He adds that another example of an offshore vehicle which will continue to command high rates are the owners of pipe-lay and derrick lay barges – used to lay pipes which is also expensive to construct.

In Malaysia, there are three notable operators namely Global Offshore (Malaysia) Sdn Bhd, a subsidiary of Puncak Oil and Gas Sdn Bhd, Barakah Offshore Petroleum Bhd and SapuraKencana Petroleum.

Players with smaller OSV vessels are Alam Maritim Resources Bhd, Coastal Contracts Bhd and SILK Holdings Bhd.

AmResearch analyst Alex Goh also points out that the oversupply of vessels are in the 5,000 bhp segment and not the 10,000 bhp segment. Goh says that channel checks reveal that these rates are currently stabilising, while the listed players have not been aggressively buying AHTS vessels in the 5,000 bhp category.

“Even though new orders for the first quarter of 2014 are likely to temporarily slow down quarter-on-quarter due to the complexities and implementation timelines of field developments, fresh roll-outs of Malaysia’s multiple enhanced oil recovery projects will continue to underpin the overall upward momentum trend,” says Goh.

He is maintaining his “overweight” call on the sector, with “buy” calls for SapuraKencana Petroleum and Bumi Armada.

HwangDBS believes that Malaysia’s O&G sector is experiencing a sustainable growth phase, thanks to Petronas’ capital expenditure (capex) commitment. It notes that most local service providers are enjoying record-high order books.

“For instance, Petronas’ nine-month-to-2013 capex of RM38.4bil is on track to surpass its record-high capex of RM45.6bil in financial year 2012, underlining the robust O&G development in Malaysia.

This shows Petronas’ commitment to address Malaysia’s energy needs, with the lion’s share of the budget going to the upstream sector.

Source: The Star Online

Posted by focuz > 2014-06-04 09:58 | Report Abuse

@jk: Very educational. Thks....

Certainly there's concern where's SILKHLD heading to. Not obvious to us at this moment. If they know where to put shareholder's moni to good use with current limitations then got to go to the S.E.A. offshores. My 1 cent thought.

Posted by Hopeman > 2014-06-04 17:26 | Report Abuse

Since already disposed highway business now concentration on oil&gas ,future should be very good and a very long way to go".....""................

Posted by Stockman > 2014-06-05 07:42 | Report Abuse

When Silkhld suppose to get the cash RM398miĺlion?

Posted by thecall > 2014-06-05 08:46 | Report Abuse

Have to sign the agreement first whch is expected to be within the next 2 weeks then only can collec the money depend on Payment term. It's usually with down payment & balance within 60-90 days. That's the normal practice by local companies

Posted by LTInvestor > 2014-06-05 11:16 | Report Abuse

Bro Lee.. i wonder where is the "noob" boy called optimusx888..?

Posted by sklyte > 2014-06-05 12:37 | Report Abuse

Ignored optimus888 he sucks when he recommend to sell u buy! When buy u sell! A conman but so accurate!as i said silk will hit higher and higher haha

Posted by thecall > 2014-06-05 12:45 | Report Abuse

With Petronas commitment & jibby desperate for $$$ to push up the rakyat income anything is possible. I still believe it will break 1.20 soon. Anyway my tp is 1.38 for the next 2 months.
Let's see what happen as I also desperate for Duit Raya coz no one is giving me chocolate boxes ler.

Posted by lee9fold > 2014-06-05 12:59 | Report Abuse

hi bro LTinvestor...yea...i edi forgot the big talk fella...now he hiding dare not show face...he dare dare say will drop to 82...but in fact silk is in uptrend mode :D

Posted by Stockman > 2014-06-05 15:10 | Report Abuse

Thanx thecall

Posted by focuz > 2014-06-05 15:40 | Report Abuse

@LTInvestor: U need to get that out of your system. I dun thing it is still hurting you after so many days. Pride only. Nobody can see it when quiet. Sori being blunt.

Enjoy tis SILK show.

Posted by seongneoh3 > 2014-06-05 16:00 | Report Abuse

lai liao..

Posted by seongneoh3 > 2014-06-05 16:00 | Report Abuse

.990

Posted by johnkiew > 2014-06-05 16:04 | Report Abuse

Ride the trend of OSV industry, more important ride the trend of SILK...

Posted by sklyte > 2014-06-05 16:48 | Report Abuse

Broke one u see now u guys believe the highway is worth 600m! They sold it for 400! If it is 600, now is already 1.50

Posted by abin > 2014-06-05 17:21 | Report Abuse

dun ma hou pao

Posted by Eskay > 2014-06-05 18:15 | Report Abuse

O&G play will be the word of the year. Silk will be in a very good position to benefit from the expansion of this segment of the biz. By disposing the hi way, it will provide Silk with lower gearing and enhance its focus in the OSV biz. The counter did break RM1.00 today and I am very sure it will retest it tomorrow morning. Thereafter, we should be looking at RM1.20 as the next resistance. In the immediate 1 to 3 month period, this counter will be in a good position to reach RM1.50. Happy investing guys.