Posted by xiaoeh > 2022-12-14 17:24 | Report Abuse

dear trader808, for your opinion what is the fair value for scb? thanks a million for your sharing

Posted by SmallSexyPig > 2022-12-14 22:37 | Report Abuse

i use different metrics to trader808 to judge my stocks and i have the fair price down as 35.5 sen per share.

but trader808 is 100% right about one thing and that's they need to reduce their liabilities and bank loans they've added RM100m to liabilities in the last year looking at my balance sheet.

i am interested to see how things change as material costs reduce. they need to find a way to increase profitability, adding to debt does not seem wise.

Posted by trader808 > 2022-12-15 11:39 | Report Abuse

1. In 2021 the revenue was 659.93m and the net profit was 10.929m. therefore the net profit margin was 1.6%. for the 9-month 2022 the cumulative revenue is 637.7 and profit is 9.07m. Thus, the net profit margin is 1.56%.
2. Basing on these numbers it is reasonably safe to assume that the company's profit margin is 1.6% on less.
3. This also means it has to send out a team to do marketing to sell the cables. it needs to purchase raw material copper to produce the products, ensures its quality, delivery on time and wait 2 months to collect its payment.
4. For all this troubles and risk, SCG gets 1.6% returns on its effort. This number indicates inefficiency in resource management and non effectiveness of its capital employed.

5.To criticize constructively, brutal and unpleasant in the fiercely competitive business environment if you are unable to secure a fair return, it is better off not manufacturing and instead invest with the bank, put it in FD and earn 3% risk free rate.

Posted by Risk Trader > 2022-12-20 21:04 | Report Abuse

The price already at buttom, is time to accumulate and hold to next qtr result for good return.

Posted by trader808 > 2022-12-21 23:17 | Report Abuse

1.The market PE is 13x. SCG is trading at 29 sen and a running 4-quarter earning per share EPS of 1.61 sen. Hence, it is trading at a PE of 18x. That is inordinately and disproportionately higher than the bursa PE. And that rates and ranks SCG more attractive, over and above a blue chip counter.

2 Despite its recent bonus issue of free warrant and numerous announcements of new contracts, sadly its share price has continued on its decline and its daily volume traded has severely reduced. What happens ?
3. The recent announcement that the company has secured 293m power cable supply contract with Tenage; 83m power cable supply with SEB; and its aspiration to export 100m value of cable to the US market is remarkable and commendable. The new business is 476m. Let's take a look at these letters of award and happy problems that come with a burden.

4. In the 3rd quarter ending September the company's revenue was 238m. the cost of goods sold was 225m and gross profit was 12m. Therefore the percentage of CGS and GP is 94% and 6% respectively.
5. To finance 476m new business the company would need 0.94 x 476m and that is 447m to finance raw material requirement and working capital.
6. Notice that the company has a cash balance of 19.7m and generate a negative cash flow of (-29.528m) This means the company needs more cash than the business can generate. The above new order will further aggravate the cash position and working capital requirement that is already distressed.

7 IN 2019 the company has 130m in account receivable. In 2020 the account receivable was 158m and these numbers had ballooned to 199m in 2021 and 222m in the 9- month of 2022. If you take 222m divide by the revenue of 637m multiply by 365 days, the collection period work out to be 127 days. That means it takes the company 4 months plus 7 days to collect payments after delivery. If the speed of collection can be increased and the days of collection can be reduced this would strengthen the working capital.

8. Considering the current situation in which it was awarded huge supply contract, the company has a happy problem that comes with a heavy financial burden. It is not unlikely that the company might have to look at various option to raise fund for working capital and to finance the new business.
9. The company has 197m in borrowings and 283m in total equity. Therefore the gearing is 197 divided by 283 is 69.6%. Sixty percent is considered a high gearing. By accounting standard any numbers beyond 60% signify the company has entered into a red zone

10. It will be interesting to see the next course of actions from the management. Share price will remain depressed and volume lackluster until this matter is resolved.
11. Friend. cut loss and move on. This is my personal perception of the counter.
It may or may not be correct.
21/12/22

Posted by xiaoeh > 2022-12-22 10:05 | Report Abuse

Thanks SmallSexyPig and trader808 for your sharing

Posted by trader808 > 2022-12-23 11:05 | Report Abuse

1.While operating cash flow is important, free cash flow is more crucial and net cash flow is significantly more critical. Temporarily, SGC has non of the latter two. And they are the heartbeats of business.
2. This is not surprising considering that scg collects its accounts receivable calculated by taking 222m divided by 637 multiply by 365 is 127 days.
3. it pay its accounts payable with lighting speed computed as follows.
Assuming 85% of 637m is purchases or 541m the accounts payable balance is 52m.
so the AP turnovers is 541m divided by 52m is 10.4x in a year or 35days.
4. See they pay creditors in 35 days and receive money from their accounts receivables debtors in 127 days. it is almost suicidal.
5. The accountant has enormous opportunity and room for improvements. More stringent credit control and efficient strategy need to be formulated and implemented to strengthen its collection.
6. otherwise continued and prolonged negative cash flow would require new funding to address the shortfall in working capital requirement. It could be further bank borrowings or corporate exercise of fund raising through right issue or private placement. All of which are discouraged for they are value and share price destruction.

Posted by Haleluya > 2 months ago | Report Abuse

IPO price 0.34;
Price now 0.29 + warrant 0.07/2 = 0.325
Cheaper than ipo price...

Posted by trader808 > 2 months ago | Report Abuse

Disagree.
Would appreciate if you could kindly share what is fundamentally good about this company.

Posted by Risk Trader > 2 months ago | Report Abuse

Is time to collect....anytime will fly

Posted by Risk Trader > 2 months ago | Report Abuse

Next qtr rpt to be out next mth...the result must be better

Posted by Raiz368 > 2 months ago | Report Abuse

Yes RT..I think buy son is better

Posted by Raiz368 > 2 months ago | Report Abuse

Now price 0.07 to 0.075 cent.

Posted by SmallSexyPig > 2 months ago | Report Abuse

knowing bursa, if QR is good. share price will fall xD

Posted by xiaoeh > 2 months ago | Report Abuse

Posted by trader808 > 3 days ago | Report Abuse
Disagree.
Would appreciate if you could kindly share what is fundamentally good about this company.

Trader888, take a look at Karex when price bottomed around $0.34 alongside ugly qrtly result, i assume same question came out from you then.
I am not saying that same thing is going to happen here but normally prices have already sky high when what u mean good fundamental disclose to the public.

Posted by xiaoeh > 2 months ago | Report Abuse

It is what u believe or not believe 5G implementation will benefit SCGBhd matter.

Posted by xiaoeh > 2 months ago | Report Abuse

It is what u believe what u see in the technical chart matter.

Posted by xiaoeh > 2 months ago | Report Abuse

As long as it is not a debt laden, stagnant growth or no growth, -ve fcf kind of company, my personal view is that it is worth to bet once u believe. But remember to cut loss if price move opposite what you believe.

Posted by Silentreader88 > 2 months ago | Report Abuse

Volume in , reversal pattern? warrant all time low still at 0.07 . 2022 valid till 2027. 100% opportunity?

Posted by Raiz368 > 2 months ago | Report Abuse

Is time to buy...break 0.315 will go higher

Posted by imvu > 2 months ago | Report Abuse

nampak macam best ! gap up limit up ?

Posted by Raiz368 > 2 months ago | Report Abuse

Tomorrow sure breakout and break to new high...

Posted by Risk Trader > 2 months ago | Report Abuse

Operator start collect this stock and will push higher before qtr rpt announcement by next mth...can buy now

Posted by Silentreader88 > 2 months ago | Report Abuse

the pleasure of seabottom fishing. mother is good. warrant pending follow

Posted by Raiz368 > 2 months ago | Report Abuse

You are right sifu RT...now my portfolio's already run profit more then 20% return

Posted by Silentreader88 > 2 months ago | Report Abuse

dont worry, now is the correct time to buy. Remember, buy on rumors, sell on news (QR annoucement next month)

Posted by SmallSexyPig > 2 months ago | Report Abuse

Since July 2022 there's been higher volume in this stock. It's become interesting to some.

Posted by Master123 > 2 months ago | Report Abuse

Mother up but son didn't follow. Sad

Posted by Silentreader88 > 2 months ago | Report Abuse

@Master123 no worry, warrant will follow later on with sudden spike. operator must push up mother first , then retailers will push warrant

Posted by Risk Trader > 2 months ago | Report Abuse

Will break 35 cent by next week...warrant price should be above 10 cent

Posted by Silentreader88 > 2 months ago | Report Abuse

RT agreed. warrant laggard (slowly) now but will suddenly spike later once mother reached 35

Posted by Kim > 2 months ago | Report Abuse

Cheap sales. Preparing to play =)

Posted by fusing79 > 2 months ago | Report Abuse

Thank you for xiaoeh & trader808 to share your valuable knowledge here

Posted by trader808 > 2 months ago | Report Abuse

1. I am not sure weather 79's posting is an admiration or criticism. But, I will take it as an opposite of compliment.
2.Market has been informed and fully aware of the projects and awards secured from TM. SEB and its ambitious target to penetrate new market and aspire to export hundred of million worth of cables to the US. In the pipe line also include the construction of new factory to facilitate growth.
3.These are old news and nevertheless, they are good news.
However, when repeated good news does not drive up share price, than it is alarming and investors need to be cautious.

4. Perhaps the expectation of future value of the company despite it many projects does not realistically represents or reflect the fundamental of the company.

5. The company has very pressing issues that must be resolved. IT has 194m debts. It generates negative cash flow. It has little working capital. It's debts to equity ratio has enter a red zone. And their period of account receivable collection is horrendously long.

6. Today's Investors are sophisticated and they study balance sheet, cash flow statement and P&L to unmask its strength and weakness.

7.While, successfully securing new projects are great and impressive but it is the conversion of project into profits that count. Still it is the cash in the bank that is king. And sadly it is seriously lacking.
8. Once awhile someone will find a reason to buy, spike up its volume and push up the price. It lacks momentum and has no energy and passion to follow through. instead, It opens up an opportunity 4 you to sell and exit at higher price.

9. This does not mean SCG is horribly bad but rather it must be interpreted as the opportunity cost of investment for holding SCG is high.

10. This is my personal perception of the counter and it is not intended to influence your trading plan and investment decisions.

Posted by SmallSexyPig > 2 months ago | Report Abuse

just fyi, cash flow for 2023 should be positive based on the fulfilment of their book orders.

Posted by Hair123 > 1 month ago | Report Abuse

HL Invest not much following. Market hot but their strong recommendation still cannot move.

Posted by Hair123 > 1 month ago | Report Abuse

This stock very disappointing. Held for 2 years. Still at IPO price.

Posted by Haleluya > 1 month ago | Report Abuse

Still can sell cost at ipo price consider not bad if see the price today 0.325/0.33... I noob entry post ipo price, stuck at 0.40, didnt sell at 0.50+ tot this for long term... Manatau wait 2yrs until neck long still paper loss now and keep waiting je lah T_T

Posted by SmallSexyPig > 4 weeks ago | Report Abuse

Hopeful for nice QR today

Posted by SmallSexyPig > 3 weeks ago | Report Abuse

QR : https://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?id=222569&name=EA_FR_ATTACHMENTS

Posted by Raiz368 > 3 weeks ago | Report Abuse

Wow...very good qtr result. Sure price will open gap up 1-2 sen

Posted by Peace99 > 3 weeks ago | Report Abuse

Got dividend some more, shiok. Think I better get some more before it up too much

Posted by SmallSexyPig > 3 weeks ago | Report Abuse

Think if they really want to reward investors they should increase the dividend pay-out. 15% of PAT is just so meh.

Posted by Haleluya > 3 weeks ago | Report Abuse

Normally Share price reflect on how good the company doing.........

Posted by Peace99 > 3 weeks ago | Report Abuse

About cash flow: from AR 2021 Chairman statement
"On 28 October 2021, Southern Cable successfully
transferred its listing status to the Main Market of Bursa
Securities, after fulfilling the Securities Commission
Malaysia’s Equity Guidelines for the transfer listing.
Southern Cable and its subsidiaries (the “Group”)
recorded aggregated profit after tax of RM76.0 million for
the past three financial years from 31 December 2018 to
31 December 2020 and maintained positive cash flow for
the same period. "
As it can get order from USA, is it not a solid recognition of its cable quality? I assume the company knows how to manage the order. If it can't handle the large order then can't it just not accept?

Posted by trader808 > 3 weeks ago | Report Abuse

1. For a month and after considerably huge effort SCG managed to forcefully push its share price from 30sen to 36sen. Yesterday, it announced its 4th quarter result. A day right after the final quarter announcement, the interest on this counter has somewhat faded, the upwards momentum ceased and volume traded enormously reduced. Why?
2. Market was trading and speculating on a more impressive result that did not materialize. With a full year earnings per share of 1.82 sen and currently trading at 34.5 sen , the counter is trading at 19.25 PE multiples. Considering that the Bursa PE is between 13x to 15x SCG is therefore somewhat overvalued. And hence, no amount of sweet talks or promotion could lift share price except earnings growth. Institution buyers turn their eyes and look elsewhere.
3. Despite making 14.54m on a full year basis, the company continues to generate a negative cash flow of( Rm41.3m). And more alarming, the debts and borrowings of the company continue to increase from 158m a year ago to 211m in the 4th quarter. Until this is resolved the share price will not make any meaningful advancement in the near future. In the coming days it will revert back to its IPO price or even worse off.
1/3/2023

Posted by SmallSexyPig > 2 weeks ago | Report Abuse

IMO the negative cashflow is not such a bad thing right now due to the amount of orders they have and the fact they're also using money to rapidly expand to meet demands. Pointing at the cash flow without looking at the bigger picture is short sighted.

Posted by Peace99 > 1 week ago | Report Abuse

https://www.sinchew.com.my/20230313/%e5%8d%97%e6%96%b9%e7%94%b5%e7%bc%86-%e8%b6%85%e5%8d%93%e5%bc%ba%e6%94%bb%e6%b5%b7%e5%a4%96/

Posted by Haleluya > 1 week ago | Report Abuse

Sunset.....

Posted by ov123 > 4 days ago | Report Abuse

Below IPO again