Internet Technology Group

[dydx]

Anyone holds shares in this counter which has declared a $0.035/share Final dividend for FY11 (ended 31Dec12) with 'XD' date fixed on 6Jun12 and have a comment to share?

While still a smallish company, ITG does have a few interesting investments, including (1) a 60% stake in Promedia Directories P/L - the publisher of "The Green Book" commercial buying guide; (2) a 70% stake in a huge (land area: 13.74 hectares) mixed-use property development project located at Nanchang County, Nanchang City, Jiangxi Province, PRC; and (3) a small unknown stake in Jobs DB Holdings Ltd (the holding company behind JobsDB.com).

More info on ITG from its FY11 AR.....
http://info.sgx.com/listprosp.nsf/07aed3...6002a6d93/$FILE/ITG%20Annual%20Report%202011+%20Cover.pdf

[shanrui_91]

The company has a crown jewel in its Promedia Directories of which revenue is derived from advertising which gives it a very high profit margin of 40%. The business model seemed similar to Today where the Green Book is offered free of charge. Revenue has been increasing and profit is not affected by the GFC 2008 for this segment. This is their cash cow.

Its property development project accounts for the bulk of its inventory of which $23m are cost of land and $6m in development cost. The land is a leasehold land stated at cost and is meant for:

"An integrated development with residential, commercial and public buildings components located at West of Liantang Road, South of Hubei Road, and East of Hudong Road, Liantang Town, Nanchang County, Jiangxi Province, People’s Republic of China" where the lease period is 70 years for residential use, 40 years for commercial use and 50 years for Public building use.

The land is claimed in 2009 and the project is expected to be finished in 2016.

With $19m in cash, $23m of leasehold land stated at cost, the bulk of the asset are quite promising. it has bank borrowing of 6.7m at an average interest rate of 4.5%. With a net asset of $29m and yet trading at $19m, it is a value buy. However, since the property will only be completed by 2016, full value will only be realised by then. Meanwhile, profit is fully relied on its cash cow, Promedia, while another $3m in revenue comes from dividend from its associate.

High Dividend seemed to be announced due to the sale of its sale of Quantum Storage (South Asia) Pte. Ltd which amonut to $2.2m as well as dividend of $3.6m received.

The company has been dragged down by its investment holding in the past while the 60% stake in Promedia is not strong enough to act as a buffer. The key lies in the $2m inter-segment sales coming from investment holding. Aithent Technologies Private Limited seemd to have created huge loss for the company such that the accumulates losses has exceeded their total investment in the company, whether this company has turnaround forever is very important. I have no idea where the $3.6m dividend comes from but the company has written and impared its investment in JobDBs and Raccoon by a huge amount so far.

One word of caution is that there is high amount of minority interest due to the 60% stake in Promedia when calculating PER. A company worth looking at if you are willing to wait till 2016 and you are assured that property developemtn will be a success. The Promedia is a very attractive business in the meanwhile,so long as all its other "investment" stop dragging the company. thanks for highlighting this company
(not vested)

[CityFarmer]

Thanks dydx for highlighting this interesting company.

With outstanding common share of only 113.6 Mils, the market cap is S$19 Mils @ S$0.17 per share.

With net asset of 23 Mils (attributable to owner), 19 Mils in cash, strong balance sheet with current ratio of 2 and valuable inventory, net cash position with only short-term loan of 7 Mils.

After the QS been disposed, current net profit attributable to owner is 3.3 Mils, the PE is 5.8 @ S$0.17 per share

It is a stock worth looking into.

(vested)

[CityFarmer]

The ITG continue to dispose other investments, to re-focus on the core biz and the property development in China.

IMO, this is a good news to investor.

Disposal Of Interest In JDB Holdings Limited
http://info.sgx.com/webcoranncatth.nsf/V...20036EFF2/$file/Disposal_Of_Interest_In_JDB_Holdings_Limited.pdf?openelement

[dydx]

ITG has sold its approx. 2% equity interest in JDB Holdings Ltd (formerly known as Jobs DB Holdings Ltd) for HKD12,499,999.50 (approx. $2.03m) and will book a gain from this diaposal of approx $1.978m - equivalent to $0.0174/share - in 1H-FY12.....
http://info.sgx.com/webcoranncatth.nsf/V...20036EFF2/$file/Disposal_Of_Interest_In_JDB_Holdings_Limited.pdf?openelement

This has been a very profitable investment (first acquired in Jun2000) as the gain amounts to over 5x of the NAV of this investment, especially since it is after ITG received $3.67m in special dividends from JDB Holdings Ltd in 2011.

[CityFarmer]

SCRIP DIVIDEND SCHEME – ISSUE PRICE OF NEW SHARES
http://info.sgx.com/webcorannc.nsf/Annou...endocument

With the issue price of S$0.122 for scrip dividend, is it worth to subscribe? Should we get the cash and buy via open market with lower price?

thinking....

[lonewolf]

I will take cash. The only reason why there was a spike in its share price and volume are becos of the hefy 3.5c dividend.

Imagine the stock IPOed in 2000 at 50c and did a 5-to-1 consolidation last yr. IPO investor who did not average down through the years would be deeply in the red (average cost $2.50!) despite the 3.5c payout. (only 3rd dividend in its history)

[CityFarmer]

I will take cash. The only reason why there was a spike in its share price and volume are becos of the hefy 3.5c dividend.

Imagine the stock IPOed in 2000 at 50c and did a 5-to-1 consolidation last yr. IPO investor who did not average down through the years would be deeply in the red (average cost $2.50!) despite the 3.5c payout. (only 3rd dividend in its history)

Well, i will reserve the decision till i received my Notices of Election form. Base on the last few days of market trend, likely the price will stay above $0.13 which is higher than the offer price of scrip dividend.

I pity those invested in the IPO. This is exactly the reason i avoided all IPOs.

[CityFarmer]

Scrip Dividend Scheme - Despatch Of Notices Of Election

http://info.sgx.com/webcorannc.nsf/Annou...endocument

With the last few days of trading of around $0.13, rationally the issue price 0.122 should be accept-able by shareholder

[KopiKat]

I will take cash. The only reason why there was a spike in its share price and volume are becos of the hefy 3.5c dividend.

Imagine the stock IPOed in 2000 at 50c and did a 5-to-1 consolidation last yr. IPO investor who did not average down through the years would be deeply in the red (average cost $2.50!) despite the 3.5c payout. (only 3rd dividend in its history)

Well, i will reserve the decision till i received my Notices of Election form. Base on the last few days of market trend, likely the price will stay above $0.13 which is higher than the offer price of scrip dividend.

I pity those invested in the IPO. This is exactly the reason i avoided all IPOs.

Yes, I deserve all the pity I can get...

According to my records, I got 1 lot @ $0.65 on Jul-00.
IIRC, I remembered feeling very honoured and happy when my broker called me to offer me some placement shares. I must have been disappointed to be alloted only 1 lot but now, I can look back and be very glad I wasn't alloted more! Yes, after the 5-for-1 consolidation, I now have 200 shares @ $3.25 vs $0.13 now. A reverse 25-bagger!
If I were to sell it, I'd still need to top up a few $ of transaction charges!

Lesson Learnt : If your broker suddenly calls to offer Placement Shares (if you are not a big timer), chances are, nobody else wants it!