Need help : can somebody enlighten me what does the term " reserves" mean in the annual report?
I just analysed : as at July 2017, KESM Has retained profits of RM 285mil + share capital RM 44mil + cash RM 127mil = total RM 456mil.........current number of shares 44mil. KESM can afford to give bonus 10 for 1
Only retained profit can give out as bonus issue. Net Cash in bank is for operating purposes. The most bonus issue KESM can give is 5:1. But usually the company will not use up all the retained profit because some of the reserve can be used for dividend purpose. I guess the most comfortable solution is 1:1 bonus issue.
I thought that a company can only issue bonus out of reserve in its share premium account, if there is none, the only other option is to do a share split, if it has any intention or plan to do so.
Fruitful discussion among investors and Mr Samuel today. Many of us expressed our hope for the possibility for the directors to consider bonus issue of at least 2:1 due to strong cash pile and growth. They will consider it. Otherwise Mr Sam is confident that KESM will grow stronger this year and hope to achieve 2 billion testing chips. capex will be rm30-40million this year and Tianjin factory will drive growth.
If they achieve 2 B testing chip, means double their previous record? If my memory is correct, RHB report mentioned they have testing capabilities of 1B?
By the way, capex for FY2018 is only 30 to 40million? Is it a statement from Mr Sam in AGM? Because based on my info, capex for FY2018 is around 110 million which is similar to FY2017.
Y I din get similar message with Optimus about bonus and capex? I also attended Agm. From the response fr board, I think they reluctant to gv bonus and share split. And huge cash will be held with minor dividen for biz opportunity. They can't forecast capex and growth, bcoz biz changing fast. But they assure automotive is stiil at the beginning stage, still long way to go. So, up to u to decide to hold long term 5-10years (this sentence by me).
Most impt is that the company is able to grow fast. If it grows fast and earnings increase exponentially then either PE will fall a lot or Price will rise significantly or both.If price will to rise significantly then it is a matter of time that the management have to declare a share bonus or split to reduce the share price.
Since our board lot is 100 shares per lot, it doesn't matter whether there is bonus/share split. Take a look at Nestle, now trading above Rm100.00, the company is not bothered to do anything. Most importantly, the company is well managed and growing all the way and its share value will appreciate accordingly.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
HENGYUAN Sexy Babe @ RM21
21,667 posts
Posted by HENGYUAN Sexy Babe @ RM21 > 2018-01-10 13:15 | Report Abuse
Split better. Split one into 5