Sunvic Chemical

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#21
(06-04-2014, 11:07 PM)ongweehiang Wrote: I only got interested in Sunvic when I found out that it is the leading producer of an industrial product in China. Got more interested when the Sun Xiao the son of the founder was appointed CEO.
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2. A father will never ask a son to take up his position if it is a fraud.

For me it was the opposite. I was monitoring Sunvic until the appointment of Sun Xiao. To appoint a 26 years old with not much working experience as CEO is simply incredulous. They could have started him at a lower position. I have no idea if Sunvic is fraud, but the appointment of Sun Xiao was enough to turn me off.
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#22


Sunvic share prices had dropped by about 20% following the company's Auditor report.

Could someone explain the reason for the drastic drop in share prices?
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#23
Idle Assets of RMB 391 million as at 31 December 2013, the Group has neither commenced depreciation nor performed any impairment assessment for these idle assets.
- Inflated asset value, management should have written down the asset since it is idle???

MTBE plant: MTBE plant has yet to commence production, it is impracticable to obtain market data for comparables for purposes of performing an assessment of the recoverable amount of the MTBE plant
- no way for auditor to value the facilities since MTBE has not started, possible asset impairment

Interested parties transaction: The transactions consist of short term loans to Taixing Jinyan amounting to RMB 333 million, the purchase of assets on behalf of RMB60 million, sale of chemical products of RMB180 million, and the transfer of land use rights of RMB20 million.
- a possible red flag when mgt is using Sunvic cash to finance their own operations.

Fund houses may not taken these factors into their initial valuation and should be lowering their fair value for Sunvic. As mentioned previously, it is wise to take certain impairment on the cost of the cracking plant in your valuation.
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#24
(20-04-2014, 10:45 PM)ongweehiang Wrote: Interested parties transaction: The transactions consist of short term loans to Taixing Jinyan amounting to RMB 333 million, the purchase of assets on behalf of RMB60 million, sale of chemical products of RMB180 million, and the transfer of land use rights of RMB20 million.
- a possible red flag when mgt is using Sunvic cash to finance their own operations.

Fund houses may not taken these factors into their initial valuation and should be lowering their fair value for Sunvic.


Related party transactions are not new to Sunvic.
In its Jan 2007 IPO prospectus, Sunvic indentified several related parties with whom it carried out a range of transactions.

Sunvic has been tardy in seeking shareholders' approval for the new related parties it is dealing with.

Sunvic disclosed in April 2013 that its transactions with "Yixing Danson" had crossed the threshold. Auditor has pointed out that Sunvic has appointed the relevant professional advisor in preparation for an EGM to ratify the transactions.

Sunvic's founder has no stake in "Yixing Danson", but is its Chairman. "Yixing Danson's" shareholder is a Malaysian party buying acrylic acid from Sunvic for production of super absorbent polymer used in baby diapers.

Purchase of assets on behalf of "Taixing Jinyan" (previously known as "Taixig Dantian") has been a recurring item. This is the first time auditor highlights it.

Founder's brother has "influence" over "Taixing Jinyan".

Can one take comfort in Sunvic's declaration that before 2013 ended, "Taxiing Jinyan" had paid, in full, the RMB 59.7m incurred by Sunvic for the asset purchase.

In 2012, Sunivc loaned RMB 10m to "Taixing Jinyan", and this was not highlighted by auditor. Of the RMB 333m loaned out in 2013 and now highlighted by auditor, the outstanding amounts as at the end of 2013 were RMB 94m.

Details revealed before the EGM may shed light on whether these transactions were beneficial to Sunvic. Is Sunvic extending assistance (from its RMB 1,100 m untapped credit lines) to related parties to facilitate its sales of products?

The acrylic acid business is on solid footing. Utilisation of new capacity of the 320,000 tonnes at Taixing (against 205,000 tonnes at Yencheng) was nearly full. Moreover, it seems that higher sales were achieved with due regard to credit risks. At the end of 2013, bank-issued notes of RMB 1,125 m (against annual sales of RMB 6,326 mlion in 2013) produced by clients were being held by Sunvic. Default risk is minimal as banks are the payees. Of the (unsecured) trade receivables of RMB 346 m, around RMB 0.5 million was impaired.

The uncertainty about MTBE plant has been discussed before in this forum. Time will tell whether Sunvic Chairman's assessment that the plant will be profitable is correct.
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#25
Mr Ong
Did you attend Sunvic AGM. I did not because of work. Lost heavily because I bought at 62c.
Thank you.
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#26
Edge featured Sunvic this week. Interesting writeups but I m not convinced by the feature.

The son seems to be a reluctant 2nd Gen who enjoys tea session with friends and picking up golf. He is also lamenting that he lacked time to go for holidays and owes the wife a honeymoon. Nothing wrong talking about family but can certainly save it for private ears.

He even added that his dad set him 2 targets when he reaches mid 50s - Sunvic to double its current size and to have 2 grandsons and 2 grand daughters for his dad...

Not vested
GG
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#27
Wink 
I lost a few Hundred Thousands $$$,$$$ in S-Chips.
If I ever miss, this might be the one!
Never mind, I better be Save than Sorry.
All the Best to those of U who are vested.

Not Vested.
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#28
What a mess! The "contributions" from the 2nd Gen i.e. the son?

(not vested)

SGX reprimands Sunvic for breaking rules on 1.6b yuan of IPTs over 3 years
30 Nov 2015 18:37
By Kenneth Lim

THE Singapore Exchange (SGX) has reprimanded Sunvic Chemical Holdings for breaching listing rules related to 1.6 billion yuan (S$353 million) of interested-person transactions (IPTs) over the three latest financial years.

SGX said that Sunvic, a maker of intermediate chemical products, failed to make immediate announcements of and seek shareholders approval for IPTs that had been undertaken with associates of Sunvic executive director and chief executive Sun Xiao in the 2013, 2014 and 2015 financial years.

The company also failed to ensure that the IPTS were properly disclosed in the company's annual reports for the 2013 and 2014 fiscal years.
...
Source: Business Times Breaking News
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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#29
(30-11-2015, 10:01 PM)CityFarmer Wrote: What a mess! The "contributions" from the 2nd Gen i.e. the son?

(not vested)

SGX reprimands Sunvic for breaking rules on 1.6b yuan of IPTs over 3 years
30 Nov 2015 18:37
By Kenneth Lim

THE Singapore Exchange (SGX) has reprimanded Sunvic Chemical Holdings for breaching listing rules related to 1.6 billion yuan (S$353 million) of interested-person transactions (IPTs) over the three latest financial years.

SGX said that Sunvic, a maker of intermediate chemical products, failed to make immediate announcements of and seek shareholders approval for IPTs that had been undertaken with associates of Sunvic executive director and chief executive Sun Xiao in the 2013, 2014 and 2015 financial years.

The company also failed to ensure that the IPTS were properly disclosed in the company's annual reports for the 2013 and 2014 fiscal years.
...
Source: Business Times Breaking News

Little regards for rules except your own rules.
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