$ EuNetworks   

High Volume, Strong Potential?

Very large sell-down today, hit a new low. I think this stock is deadmeat - could be ABN selling again. Not trustable in my opinion. Vested, will cut loss.

 

 GV must be very  promising  as it  was able to raise EURO32 million in convertible bonds. According to its announcement, GV issued the convertible bond in order to accelerate investment rollout in response to increased customer demand.  GV  has secured more and more biz which means it would not be too long before the revenue accrues to GV as PROFIT!!!   By then (as from  2nd half of 2008 ?), it shd "cheong"!!

 

ABN reduced its holding from 9.0713% to 8.3083% - could it be one of its clients was cash strapped and needed to sell?   Don't worry - the future prospects of GV shd look good as ABN did not unload all its holding.  Cashiertan's suggestion that GV should rise in price should come true early next year?   

 

so it is abn which is selling down when the px look poised to go up, well hope GV can do like what some counters did, raise up after fund house sold.

 

ABN AMRO today unloaded a few million shares.  Wonder why.  All this while they were buying all this while. 

 

With so much secured biz, the revenue shd accrue to GV w.e.f. 2008..  As GV's borrowing costs would be reduced  through  the proceeds of the bond,  it shd be able turn around faster as from 2008, right? Patient investors  have to wait  only another three months  to see  the turnaround.. 

 

i thinks musicwiz opinion explains the drop in price... i.e some investors have lost faith with GV because they have yet to show tangible earnings.. .but Hikitty, I remain vested becos I agree with your view.  I think by raising a convertible bond, it would help them reduce their borrowing costs ... the problem with that is for us shareholders, our shares are further diluted... hence the dip too...

 

Tks musicwhiz for your learned opinion.  Perhaps, it could be just a difference in operational style. While some, NOT all, value investors do  not  favour GV's style, others seem to favour GV's style by buying by the thousand lots on the dip. GV has to prove to its investors that its business style is correct as  earnngs from its secured biz have not crystallised yet.

 

Perhaps I can provide a possible explanation ?

A company has to grow through retained earnings and positive operational cash flows; not debt alone. Debt can help a company to secure assets which are used to generate earnings and cash inflows, but ultimately if the debt does not generate sufficient earnings (to cover the interest + principal) then debt becomes a burden instead of a help.

For Swiber, bond issue was to build their vessel fleet in order to scale up their operations. They already have positive cash flows from operations and are hoping to increase this further. GV, on the other hand, has -ve operational cash flow and losses. Thus, it becomes suspicious when they keep issuing debt to "fund expansion" as no earnings have crystallized yet.

Just my 2-cents. No longer vested.

 

When Swiber announced that it had successfully raised its bond issue, the share surged upward in price with increasing volume.  Just can't understand - for GV the shares dipped in price, despite GV having secured much new biz.  Would its gearing increase manifold to justify the dip, or  was  it just due to mkt sentiments? Any comments? 

 

Hi Pension

Pse  send your posting again.   U signed off with a "smiley" which appears in your posting.

 

 

Hi musicwhiz

Many thanks for your  analytical perspective of GV.  The final conclusion - GV is far too ambitious .  High gearing - only time (may few years, which few investors are not prepared to wait) will  tell whether it's tantamount to the company committing suicide!!
 

 

hikitty

Have a read at musicwhiz's blog http://sgmusicwhiz.blogspot.com/

 

The GV counter has gone "crazy" this morning based on the buying up tempo @ 17cents.  A historically high volume of transaction for GV in less than 1 hour after trading opens.  Any pending  news for the "craze"?  Will trading on GV shares be halted soon? Anybody care to throw some light, pse.

 

I bought into GV based on TA few months ago... the selldown was so fast n furious i didnt manage to react to it... in fact now I am holding at loss.. hoping to recover only...

 

whats up with that bond issue thing? anyone can share with me what it will affect?

thanks 

 

Wow kolslorr

U must have so much confidence in GV to vest in it.   Thanks for highlighting that single transaction.   Could it be a fund?  At say 17cts, the transaction is worth S$2.04 million  
Buying for its long term prospects?  Could it be a contra player or a big time short seller who has to cover his position at closing time? After 2007 GV shd continue to be profitable once the annual revenue for the secured biz projects is realised.

 

12000 lots single buyup, last minute...

signigicant share holder?

 

AgreeGV shd move once it becomes profitable  after realising all its revenue for its many projects secured  in 2007.  Its pace would depend on whether the BBs or syndicates want to play it up fast. Guess, they have rotated to other counters, and may move back to play up GV soon?