Adampak   

Potential explosive stock

CIMB expect the S$ to appreciate from $1.44/US$ in 2007 to S$1.41 in 2008. A stronger S$ would increase Adampak?s operating costs such as manpower and utilities, which are denominated in the local currency, although the group has a natural hedge from material costs denominated in US$, which form about 70% of its total costs.

Management indicated in Jul that it had submitted RFID baggage tag samples to the McCarran International Airport in Las Vegas. It is awaiting McCarran?s decision and believes that a decision could be made in 1H08, instead of end-FY07. The initial order is estimated at 13m tags. CIMB have reduced their revenue estimates for RFID on the back of slower-than-expected contributions and risks that Adampak may not be awarded the contract, or that its bidding partner may not award the entire contract to Adampak.

CIMB have downgraded Adampak to Neutral from Outperform; reducing target price to $0.42 from $0.79, based on the peer average of 6x CY09 P/E. They have also cut their earnings estimates for FY08-09 by 25% in view of slower earnings contributions from its RFID business as well as higher operating costs expected.

 

Any new research ? or TP ?

 

ADAMPAK LIMITED
Company Registration Number: 197900079M
MEDIA RELEASE ? FOR IMMEDIATE RELEASE
Prudential Asset Management takes a 5.69% stake in Adampak
Singapore, 15 June 2007 ? Adampak Limited, (?Adampak? or the ?Group?), a manufacturer
of high-performance labels, radio frequency identification (?RFID?) tags, seals and other
precision die-cut components, has announced that Prudential Asset Management
(?Prudential?) has purchased 15 million shares at the price of S$0.435 per share from the
Group?s Executive Director, Mr. Anthony Tay. Following the purchase, Prudential Asset
Management is now a substantial shareholder of Adampak.
?We are happy to welcome Prudential as an institutional investor in Adampak. This
will raise our corporate profile and strengthen our shareholding base. All the 15
million shares on offer were taken up by Prudential as a show of confidence in
Adampak?
Mr. Chua Cheng Song, CEO of Adampak
---- The End ----

Adampak has also built up an extensive customer base that includes many multi-national corporations in the forefront of technology development and innovation. This, together with the arsenal of skill sets and capabilities acquired over years of operations, has enabled Adampak to expand its product offerings to include labels incorporating special features and precision die-cut components.

Today, Adampak?s advanced label product offerings include RFID (?Radio-Frequency Identification?) tags for tracking and control purposes and security labels for the purpose of counterfeit detection. In addition, its precision die-cut component offerings include adhesive free zone seals, dampers, insulators and bonding tapes produced in Class 100 Cleanroom.


For more information, please visit Adampak?s corporate website at www.adampak.com

 

Looks like making another climb upwards..

any info on this background ?

 

High Volume since mid-june, closed at 0.56.. up trend 

 

Creeping up slowly and steady.. Look like Feb result going to be good.

 

    Worth monitoring.



    This counter became active since 29 Sep. Prices shot up from $0.205 to $0.23 over two days accompanied with heavy volume.



    Fundamentals of the company are good. Analysts at NRA and Westcomb covered the company in Aug 06 following the release of company's 1H06 results and recommended buy with tp of $0.31 and $0.33 respectively. Analysts highlighted the company's revenue for 1H06 rose by 25.7%, net profit by 51% and gross margin of  31%. 



     Price catalyst will come from expansion of Seagate which is the biggest customer of Adampak and the company's new RFID tag business.

    

     The counter went further up to $0.245 (all time high) and closed at $0.24. 



     I observe that there has been no discussion on this counter so far in this forum. I am highlighting it for forum members to take a look.



     I wish to declare my interest. I have gone in today to accumulate some. Just testing water at this point. Any comments?