King Wan Corporation

(30-11-2015, 07:03 PM)GFG Wrote:

(30-11-2015, 05:46 PM)cif5000 Wrote:

(30-11-2015, 09:39 AM)GFG Wrote: The time to be bearish (on hindsight) for KW should be 2-3 quarters ago, just before the writedown of DSC, not now.

If $0.30+ was over-priced, I don't see how the current price can be a bargain after the impairment and with KTIS trading below the IPO price.

The $12m impairment was announced in May 2015. The Annual Report was published in mid July (providing details to the guarantees and a simple balance sheet of the Associate). The stock price maintained at around $0.28 until late July. Investors had plenty of time to take profit or cut loss, whichever the case may be.

IMO, the stock price is pretty efficient. Not instantaneously but it does settle down to the available public information. I like this kind of stocks because the slight lag in price provided the opportunities for those who bother to read up.

I didn't say it's a bargain.
I said the time to be bearish is earlier, not now because the risk-reward ratio is now more favorable than before. In other words, after the write downs n recent drop in share price, the risks of it falling substantially is lower compared to before.
Anyway, I guess I'm on record here saying that I'm vested and will remain vested at current price.
(Approximately $0.215) 
And can I say that you'd recommend not being vested, and if one is, to sell out now at $0.215?

It'd be fun to check back in 12mths.
This is just a friendly wager/competition. We have differing opinions right now, which is fine
In any case, even in 12mths, the result is not fully reflective either as there may be macro factors at work that nobody can predict but still a good exercise to do.
If I'm right then, I'd share my research that gives me confidence.
If I'm wrong, then I guess I won't!

My answer: No. 

I put KW into the "too hard" basket at this point of time. Things may change as more facts become available.

You may be right 12 months from now. And I may be wrong to sell this stock 12 months ago.

(30-11-2015, 10:23 PM)pianist Wrote: Wonder what was the price per sqm in rmb for the first phase of fully sold lushukou project with dsc

The 1st phase is sometime ago and I don't have the information according to phases.
Here's according to timeline (calendar yr, not financial)
In 1Q2011, 7000RMB
In 2012, 7600 RMB
2013  7800 RMB
2013 end - 2014 7400 RMB
Most recent valuation of Xin Jia Po Hua Yuan: 6500 RMB

Note that the recent valuation does not impact the associate directly as residential units are fully sold
Of course it does in turn affect remaining phases.

At 6500 RMB though, it's STILL substantially higher than the average in Lu Shun Kou sub district, which ranged from 5580-5725 RMB in early 2015, and is now at 5383 RMB (nov 2015)

All these are in turn substantially lower than average prices in Dalian city itself
Which has fallen from 11000RMB in early 2015 to 10029 RMB now

(30-11-2015, 11:51 PM)cif5000 Wrote:

(30-11-2015, 07:03 PM)GFG Wrote:

(30-11-2015, 05:46 PM)cif5000 Wrote:

(30-11-2015, 09:39 AM)GFG Wrote: The time to be bearish (on hindsight) for KW should be 2-3 quarters ago, just before the writedown of DSC, not now.

If $0.30+ was over-priced, I don't see how the current price can be a bargain after the impairment and with KTIS trading below the IPO price.

The $12m impairment was announced in May 2015. The Annual Report was published in mid July (providing details to the guarantees and a simple balance sheet of the Associate). The stock price maintained at around $0.28 until late July. Investors had plenty of time to take profit or cut loss, whichever the case may be.

IMO, the stock price is pretty efficient. Not instantaneously but it does settle down to the available public information. I like this kind of stocks because the slight lag in price provided the opportunities for those who bother to read up.

I didn't say it's a bargain.
I said the time to be bearish is earlier, not now because the risk-reward ratio is now more favorable than before. In other words, after the write downs n recent drop in share price, the risks of it falling substantially is lower compared to before.
Anyway, I guess I'm on record here saying that I'm vested and will remain vested at current price.
(Approximately $0.215) 
And can I say that you'd recommend not being vested, and if one is, to sell out now at $0.215?

It'd be fun to check back in 12mths.
This is just a friendly wager/competition. We have differing opinions right now, which is fine
In any case, even in 12mths, the result is not fully reflective either as there may be macro factors at work that nobody can predict but still a good exercise to do.
If I'm right then, I'd share my research that gives me confidence.
If I'm wrong, then I guess I won't!

My answer: No. 

I put KW into the "too hard" basket at this point of time. Things may change as more facts become available.

You may be right 12 months from now. And I may be wrong to sell this stock 12 months ago.

K, fair enough.
But isn't "too hard" basket = not being vested now?
guess no friendly wager here then.

(01-12-2015, 12:50 AM)GFG Wrote: guess no friendly wager here then.

Tikam tikam?? Onz...

How about I pick something else?

STI at the current 2,878.46 vs. King Wan at last done price $0.225.

Time frame: 12 months

(01-12-2015, 12:48 AM)GFG Wrote:

(30-11-2015, 10:23 PM)pianist Wrote: Wonder what was the price per sqm in rmb for the first phase of fully sold lushukou project with dsc

The 1st phase is sometime ago and I don't have the information according to phases.
Here's according to timeline (calendar yr, not financial)
In 1Q2011, 7000RMB
In 2012, 7600 RMB
2013  7800 RMB
2013 end - 2014 7400 RMB
Most recent valuation of Xin Jia Po Hua Yuan: 6500 RMB

Note that the recent valuation does not impact the associate directly as residential units are fully sold
Of course it does in turn affect remaining phases.

At 6500 RMB though, it's STILL substantially higher than the average in Lu Shun Kou sub district, which ranged from 5580-5725 RMB in early 2015, and is now at 5383 RMB (nov 2015)

All these are in turn substantially lower than average prices in Dalian city itself
Which has fallen from 11000RMB in early 2015 to 10029 RMB now

thanks. the fall is not great so far. actually I may consider buying an unit there. I been to lu shun kou deliberately in the past to find out the environment there. it was great..

(01-12-2015, 12:48 AM)GFG Wrote:

(30-11-2015, 10:23 PM)pianist Wrote: Wonder what was the price per sqm in rmb for the first phase of fully sold lushukou project with dsc

The 1st phase is sometime ago and I don't have the information according to phases.
Here's according to timeline (calendar yr, not financial)
In 1Q2011, 7000RMB
In 2012, 7600 RMB
2013  7800 RMB
2013 end - 2014 7400 RMB
Most recent valuation of Xin Jia Po Hua Yuan: 6500 RMB

Note that the recent valuation does not impact the associate directly as residential units are fully sold
Of course it does in turn affect remaining phases.

At 6500 RMB though, it's STILL substantially higher than the average in Lu Shun Kou sub district, which ranged from 5580-5725 RMB in early 2015, and is now at 5383 RMB (nov 2015)

All these are in turn substantially lower than average prices in Dalian city itself
Which has fallen from 11000RMB in early 2015 to 10029 RMB now

thanks. the fall is not great so far. actually I may consider buying an unit there. I been to lu shun kou deliberately in the past to find out the environment there. it was great..

(01-12-2015, 12:48 AM)GFG Wrote: Note that the recent valuation does not impact the associate directly as residential units are fully sold

I thought this may interest you. 

In the annual report under Related Party Transactions, you will find that King Wan had made advances to certain associates to purchase property units from Dalian Shicheng Property Development Co. Ltd. The sum in FY13 was $4.2m. In FY14, another $2.4m advances to associates were made for the same purpose to purchase property units from Dalian Shicheng. In FY15, yet another $4.1m were loaned out. This time, the loans includes advances made to "Joint Venture" in addition to only associates. No prize in guessing who the <partner> is but strangely they would only classify that entity as an associate despite owning the other 50% stake. 

All in, $10.7m went into associates and JV to buy property units from Dalian Shicheng. I don't know if these entities use leverage when they bought the property units (I would). I also don't know if TA or others put in money into the associates and JV for the same purpose. What I know from KW annual report is that the revenues for Dalian Shicheng in FY14 FY15 and FY15 FY14 were $10.7m and $0.8m respectively. A total of $11.5m.

http://infopub.sgx.com/FileOpen/KWC%20Re...eID=389397

8 mil allowance for Dalian property business, doesn't look good....

I though they have only got 6mil investment left in DSC? So did they pour in 2 mil more during the period? Are they taking on more liabilities? Will there be more write-off on DSC?

Think KWC will sink below 20cts........

(13-02-2016, 07:52 PM)GPD Wrote: I though they have only got 6mil investment left in DSC? So did they pour in 2 mil more during the period? Are they taking on more liabilities? Will there be more write-off on DSC?

Think KWC will sink below 20cts........

Extracted from Q3 results

Note 6 -Allowance was made in connection with the Group’s real estate development business in Dalian, China. In view of the continuing depressed real estate market in Dalian, China, the Group made allowance for doubtful receivables due from its associate, DLSC Singapore amounting to an aggregate of S$8.0million for the
nine months ended 31 December 2015.