Adampak

This afternoon (18May11), Adampak released the presentation slides used for the Q1-FY11 results briefing.....
http://info.sgx.com/webcoranncatth.nsf/V...4000EFF40/$file/AdampakLimited-ResultsBriefing1Q2011.pdf?openelement

I thought Mr Market has so far reacted to the seemingly below par but well explained Q1-FY10 results in an interesting way. In the last 2 market days, there have been quite a few shareholders parting their Adampak shares - which have been rewarding them great twice-a-year dividends - to other rather happy buyers who under normal circumstances would not have been able to acquire such a good volume of shares at the current marked-down prices. It shows that different people interpret the same information differently. Mr Market amazes me!

A Lim & Tan report on Adampak. Please see attached.

(Not Vested)

Strange they have not mentioned about forex risks.

(19-05-2011, 06:45 PM)memphisb Wrote: Strange they have not mentioned about forex risks.

I believe the USD is going to hurt Adampak a little more before things start to get better. i.e. more pain in next qtr's results. (Yahoo chart here)

Having said that, their past results indicate that this is a decent company run by quality management which is good for conservative investors who want to sleep well.

Yup, I'm quite tempted to average down my cost (got mine @ $0.345). Hmm...

(20-05-2011, 11:04 AM)kazukirai Wrote:

(19-05-2011, 06:45 PM)memphisb Wrote: Strange they have not mentioned about forex risks.

I believe the USD is going to hurt Adampak a little more before things start to get better. i.e. more pain in next qtr's results. (Yahoo chart here)

Having said that, their past results indicate that this is a decent company run by quality management which is good for conservative investors who want to sleep well.

I forgot where i read that QE is rumoured to continue until nov 2011. This devaluates USD.

And I don't recall Adampak has currency hedging in their reports.

(20-05-2011, 11:27 AM)xlh1476 Wrote: Yup, I'm quite tempted to average down my cost (got mine @ $0.345). Hmm...

if i were u if would have average down..
but my cost-in is at 0.126, thus have a tougher call whether to average up..
any suggestion?

pianist Wrote:if i were u if would have average down..
but my cost-in is at 0.126, thus have a tougher call whether to average up..
any suggestion?

What you paid is history. You can't turn back the clock. It would be wiser to focus on whether the stock is a good investment NOW at the current price.

If it helps, pretend you don't own ANY shares of the stock. Would you buy it now?

(21-05-2011, 12:34 AM)d.o.g. Wrote: What you paid is history. You can't turn back the clock. It would be wiser to focus on whether the stock is a good investment NOW at the current price.
If it helps, pretend you don't own ANY shares of the stock. Would you buy it now?

thanks for the post, will certainly bear this in mind.

I'm wary about the placing my bets on a boost in business due to the mergers though. The article put up by sgmystique on the prev page seems to suggest that the main focus of the acquisitions may have been to access flash drive technology. As far as I know, I don't think Adampak supplies labels or die-cuts for flash drives yet, and even if they do, flash drives have no moving parts, so they would not require dampers would they?

And now that there will be less competition in the HDD manufacturing sector, I would think that a more oligopolistic industry would tend towards lower volume but higher prices. These higher prices may not filter through to the component manufacturers though, particularly for those components which comprise a small cost of the total hard disk cost.

In short, while management is prudent and balance sheet is strong, and of course the dividend is nice, I think that Adampak's industry may be facing poor prospects in the longer term. The poorer results this quarter may be more than a temporary blip. My feel.