Discussion Corner for PACIFIC ANDES RIGHT

Nickyng, u shooting this one down as well?

Me still waiting below 0.20 to collect.

here..... http://research.sgx.com/reports/rpt_view.pl?id=5926

Pacific Andes Holdings

Post rights, still a BUY

Rights issue to raise S$209m. Pacific Andes Holdings' (PAH) Rights
issue is progressing smoothly with the current trading of the "nil-paid"
rights. Upon the completion of the rights and warrant exercise, the group
would have raised about S$208.68m (or a net proceed of S$204m). Funds
from the Rights cum warrant issue will be largely deployed as part of its
working capital and for general corporate expenses. With this exercise,
the overhang on capital raising is removed and the group is in a better
financial position. Gearing is also expected to come down from 0.9x to
about 0.6x (see next page for table on important dates and times).
Is current high oil price a concern? Recent rebound in crude oil prices
could once again sparked concerns over its costs of bunkers. However,
bunker cost as a percentage of PAH's cost of sales is fairly manageable at
about 10% in FY08 and 11% in FY09 (even when oil prices shot to record
high levels of more than US$140 per barrel). As such, at current crude oil
price of US$70 per barrel, we are not overly concerned about the impact
on its margins.
Maintain BUY, adjusting fair value post-Rights. Recently, PAH's posted
a credible double-digit earnings growth of 38% in FY09 earnings to
HK$664m. For the current year, we are expecting earnings of HK$720m
before rising to HK$822m in FY11. The improvement will come largely
from organic growth, stemming from the deployment of five vessels to the
South Pacific (which will mean increased catch volume) as well as better
synergies from its integrated Peru operation. While global economic signals
remain mixed, we believe that fish consumption will at most be mildly
affected as consumption patterns are unlikely to change too drastically
and fish is an affordable source of protein. Risks to our earnings include
the escalation of the current H1N1 outbreak, slower fish demand from
China, and any regulatory issues with the Russian fishing quotas (which
still formed the bulk of its operation). Maintaining the same peg of 6x
blended earnings, our post-rights adjusted fair value estimate is 31 cents.
The stock has done very well this year, outperforming the STI with a gain of
68% versus 32% for the STI. With the current softness in the market and
with a potential upside of 48% to our fair value, we are reiterating our BUY
rating.

Ooo, i will be there to collect as well if happens. Haha.

Freeme, welcome here too. Emm play contra again?