TTJ Holdings

[smallcaps]

Waiting to see whether Mr Teo buys on open market like last time, after he transferred shares to own CDP:

http://infopub.sgx.com/FileOpen/_eFORM1....eID=325073
http://infopub.sgx.com/FileOpen/_eFORM1V...eID=347064

[brattzz]

ok, keep our fingers crossed!

[pianist]

Sounds like a gloomy news

[brattzz]

Sounds like a gloomy news

It is! 5300->500....

on the otherhand, return of capital to shareholders is expected since no need soo much cash leh... so...

that's why we are keeping our fingers crossed!

[ksir]

Isn't it within expectation? Extension would have been unexpected. I guess Mr.Market has again successfully messed up people expectation.

Could it be the usual tricks?
1. Bad news released
2. Price drop
3. Average the dropped price then GO

Maybe here we go again?
Sad, hopefully not again!

Frankly i am more concerned about the efficiency of the workers/projects.
When they have the dormitory, to an extend, they are able to control/smoothen the flow of workers (likely to be their or contractors employees).

Without that may be more costly and less efficient?

[money]

To play devil's advocate, if i am the boss and i intend to delist the company, i have already announced bad news that the dorm will not be renewed. Next, i will NOT announce a special dividend that many investors have anticipated. People will be upset and sell off their shares. Since i have not won many contracts for the next few quarters, and my dorm business is also gone, my earnings will show some downward trend, more people will sell...then drag on for a few more years, then delist my company cheap.

i hope i am wrong since many buddies are vested in this stock. But it is definitely not a certainty that the boss will announce a special dividend. i do hope that i am wrong but for people who are buying into this stock now, i thought it is quite a risky move. As you will see, i am not vested.

[CY09]

That's definitely a very high possibility! In fact, there may be one company already doing it.

For TTJ, the question now is how much is the company worth post TERUSAN LODGE I .

Assuming TTJ experiences 1) removal of 30% of full year profits due to dormitory, 2) Business in structural steel does not slow down; we can reasonably expect annually about 3 cents EPS. With most of its book value now in current assets (hence book value of about 35 cents),

How much should this company be valued at, barring the possibility of a shareholder unfriendly mgmt

<Still vested>

[BlueKelah]

That's definitely a very high possibility! In fact, there may be one company already doing it.

For TTJ, the question now is how much is the company worth post TERUSAN LODGE I .

Assuming TTJ experiences 1) removal of 30% of full year profits due to dormitory, 2) Business in structural steel does not slow down; we can reasonably expect annually about 3 cents EPS. With most of its book value now in current assets (hence book value of about 35 cents),

How much should this company be valued at, barring the possibility of a shareholder unfriendly mgmt

<Still vested>

with big reduction from dorm income, there is no more significant recurring income. most of TTJ increase in share price and valuation is probably due to this recurring steady income.

There is also probably a slowdown in structural steel market(as can be seen by no more regular addition to order book as been happening past couple years and with TTJ tendency to bid only higher margin projects)  the likelyhood of a dip is very high. IMHO its already a foregone conclusion.

Reckon if the boss doesnt end up privatising this year as many are SPECULATING, once the poor result start coming in, which will only happen maybe in half a years time since the results in the short term will be reflecting the previous good year, market will probably value TTJ at 20c range, around 50% of its NAV.

If i was the boss I can predict that would happen. I just have to wait a year or so for the share price to correct and then start collecting at cheap prices, or activate the SBB to reduce the float and increase my % holdings.That will take another half year or so. Then when enough % liao then do the GO and no need to pay even NAV for the company

Just had a look the dip today on the bad news is already pretty bad, maybe some were speculating on the renewal of dorm business.

-n v-

[ksir]

I concur the recent high expectation in market price doesn't provide sufficient margin of safety.

However, for the structural steel business unit, i have a different view.

The past depressed margins in the industry were likely due to the big fish (yes the yongnam) bidding too competitively.

With Yongnam facing the cost overruns and that reflected in their financial numbers. It's likely (or so i hope) they have realised their faulty business model.

With that in mind, TTJ is in a better position now than ever.

<vested>

[BlueKelah]

@ksir how do you know that yongnam is cause of depressed margins? if so how come TTJ could still secure so many higher margin projects last couple years? and if yongnam is out of the picture surely many other companies can bid aggressively also and depressed the margins?

Even if TTJ is in better position its already almost 7 months now, no addition to order book, why? TTJ not bidding or its too competitive? 

in any case, there has been a premium being paid for the stable dorm business without which TTJ will likely not be valued by market as high as it is.

I reckon for those that were banking on good dividend from the dorm business, now is the time to take profit and exit the stock whilst its trading at fair value.

once speculation on the privatisation is no more its likely back to 25cents or less