PT Semen Gresik – Q2 2009
Posted on Thursday, October 15, 2009
Filed under
Semen Gresik,
Stalk the Winner,
Value Stalking
| 4 Comments
Let's stalk the winner by stalking PT. Semen Gresik tbk
Who is Semen Gresik?
an Indonesian Cement company, specialized in:
Ordinary Portland cement type I, II, III and V;
Portland Pozzalana cement, gypsum and pozzolanic materials; Portland composite cement; Super Mansory cement; oil well cement class G high sulfate resistant, and special blended cement.
Or to cut it short, this is all-about-cement company.
Price @ 14 Oct 09 = Rp 6800
STALK THE WINNER (see the above tabulation image for reference)
From the tabulation, you may notice of the following:
5 Years Growth Rate (2004 – 2008)
Net Margin is improving from 8% to 20%.
The indicator tells us that:
* company is gaining more moat advantageous over the years as it positions itself as the market leader.
* company is managed well and more efficiently.
Cash Flow is always positive and growing for 5 years
Although the company is expanding aggressively, the cash flow is managed extremely well.
This is achieved amid pressure to pay dividend regularly as normally required from state-owned company.
ROE growing from nice 14% to great 31%.
ROE is a good indicator of the return from our invested money.
To put bluntly, it is basically telling us that you get 30% return of your money invested in the companies.
Debt level
Until Q2 2009, total debt is Rp 230,578 compared to total cash of Rp 4,750,930. The debt level is just <5% of cash on hand.
Note: the healthy debt level is normally set as 30% What could go wrong?
Now, everything is perfectly pointing to a Winner company.
So you ask me, what are you worrying about?
Let’s be paranoid, let’s ask ourselves, what is the consequences of being wrong?
Let give ourselves some margin of safety. Should we?
I would consider the company is valuable if the PE is less than 15.
Let’s see where is it now?
Price as @ 14 Oct 2009 is Rp 6800, with this price, PE is about 13.
What could be the catalyst?
Improvement in revenue will be the catalyst for the company.
Since it has achieved the awesome level of Profit Margin and efficiency.
It is now all up to the revenue.
If the revenue picks up strongly then just relax and watch the growth story.
If that is so, all you need to do is relax, get a pack of heci (a nice food from my hometown) and watch the great show ahead.
”If the job has been correctly done when a common stock is purchased, the time to sell it is … almost never”
~ Philips Fisher
PT Berlina tbk - Q2 2009
Posted on Friday, October 9, 2009
Filed under
Berlina,
Keep the Value,
Value Stalking
| 1 Comment
Let's start this value stalking journey by stalking PT. Berlina tbk
Who is PT Berlina Tbk?
an Indonesian plastic manufacturer, specialized in:
BOTTLES, TOOTHBRUSH, CLOSURES / CAP, INJECTION PARTS
for some well known brands for instance:
Dettol, Dove, Citra, Betadine, Pepsodent etc
Price @ 9 Oct 09 = Rp 660 KEEP THE VALUES (see the above tabulation image for reference)
From the tabulation, you may notice that the NAV is around Rp 1330/share
What is NAV?
NAV is the value of the company.
or in other word, if the company is to close down today, it can sell itself for Rp 1330 per share (this is based on the rough calculation).
Now, you also see that the stock price @ 9 Oct 2009 is Rp 660 per share.
What does this mean?
It basically tells you that Mr Market (trader) values the company at Rp 660 per share. So, the market value is only half of company value.
I reckon this as Margin of Safety.
If you have read “playing with risk”, you will notice that we are trying to reduce the risk, to get control of the game.
How can it be done?
Now, if you think of it, you are betting Rp 660 to strike Rp 1330.
What could go wrong?
The debt level is high, 77% way higher than the healthy <30%.
But having said that, the debt are mostly long term debt.
There is no issue for short term debt, as the cash held is more than enough to pay it off.
What could be the catalyst?
Profit margin improvement will be the key factor for the company to grow.
The company must focus on work efficiency and cost cutting to improve the profit margin.
If that is so, one day, market will value this company to its real value.
Value Stalking
What is Value Stalking?
It is just my idea of:
First Strategy (Keep the Values)
* Finding company with good valuation, with Margin of Safety
(Value of the company more than market cap)
* Stalking the company for any changes to the value.
Second Strategy (Stalk the Winners)
* Finding company with good growth, with Strong Moat advantages
(Wide profit margin)
* Stalking the stock price of the company for the opportunity to buy
Disclaimer:
This blog is purely to share my opinions, I don’t hold any responsibilities for any inaccuracy of data or analysis provided.
This blog is intended to be a panel to discuss about valuation of companies listed in IDX (Indonesian Exchange).
Hence, participations and comments are highly appreciated.
Again, any opinions and discussions should be taken with a grain of salt.
Do your own analysis before pull the trigger.
or you will be driving with eye-shut.
”Most People would rather die than think. Many do.”
~ Bertrand Russell
”It’s not risky to buy at a fraction of what they are worth”
~ Warren Buffett
Playing with R.i.S.K
Filed under
Fundamentals
| Leave a Comment
Risk -> according to wikipedia is:
‘Uncertainty of Outcome’
To cut it short: Risk is "B.A.D"
The question is
why are we playing with Risk?
are we Risking ourselves?
Let's illustrate with a game:
if I have numbers from 0 -> 9, you are to bet ONE number, will you bet?
most probably NO..
why? cos your winning probability is only 1/10 or 10%
...You are taking Risk of 90%.. that's a Hugeee Risk ...
Now...
if we are to play big and small... would you bet?
Most of people with gambling-minded will say without hesitate:
Y.E.S.. Let's get it on..
so can you win? probably.. it's a 50:50 chance..
or I prefer to call it 50:50 Risk..
Then...
If you ask me...
Am i going to play the above 2 games?
the answer is NO.. a big NO..
W.H.Y....??
Reason being: taking risk of 50% is not necessary...
This is a game of luck... you don't have control ...
or in other word.. you can do NOTHING even if you try your best..
That's why.. most people love to play mind conscious game..
such as Poker...
Is playing poker risky??
Yes definitely... for people who don't know how to play..
they will be slaughtered pigs..
For people good in playing it,
is there any Risk?
I won't say NO, but it's not a risky game for them..
Why is it so??
* If i know my card is bad... i can always play save... i know i will lose but
not losing too much capital..
* If i know my card is quite ok... i can try to win...
* If i get a really good card... I know.. its time.. to win big... (in poker face)
There is a ControL... the key here is ConTroL
It is to know how to play the game well..
and to control yourself ...
all depends on you...
You control the risk... you reduce it to your advantage...
Having said that, the risk is always there, when you don’t know how to eliminate risk or you don’t even know whether something is risky or not.. then the advice to you is … to find out before you do anything..
”When you don’t know what to do…. do nothing…”
quoted from a “forgotten-name” book.