Noble Group

[BlueKelah]

Individuals (traders) who attempt to long Noble may not be in the right frame of mind. Given its poor cash flow generation ability, Noble is not a good buy.

In addition, I will like to highlight that Noble has about 400m of perpetual securities. Due to the classification of this instrument as equity, Noble's debt has been underestimated. With the loss of investor confidence in Noble and an impending 1.19 Bil USD of senior notes due over the next 1 year. It will be interesting to observe how Noble will rollover the debt. I am pretty sure Noble will not be able to get the 3.3-4% favorable interest rates. The senior notes it may raise in the future will be closer to its perpetual securities rate of 6.0% or higher. In its recent quarter reports, it is observed that Noble's short term bank debts have increased by USD1.7 billion. Noble's financial health is now greatly dependent on the bank's decision to rollover the debts continuously. Should this consortium of banks decide not to trust Noble's number and pull out this lifeline, Noble is screwed

Fundamentally, Noble may be profitable but its cash flow problems may cripple it. As the saying goes, when times are bad, banks will take the umbrella from you. This is what is happening now among brokerages.

It is likely in the end, Noble will be removed from the STI index, inducing the last few waves of selling from ETF and fund managers

you might just be right. If there is more short-term profit to be made via asset sales, it will make more sense for banks to reevaluate noble and withdraw funding and they will get an insolvent company with assets which they can cash in.

Looks like with the negative sentiment today over Japan contraction, Noble looks like gonna back down below 40c. The big fund guys should have had their chance and exited the stock during the last push up.