World Precision Machinery

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#21
Will World Precision be able to turn around from a lackluster performance in 2016, this year (2017). The share price has dropped to $0.21 and is still going without any takers. 

dydx - You have been a long term holder of World Precision and they have been extremely generous with their dividend till 2015. Last year was NIL dividend. Do let me have your take on what may be the road forward for them. In fact this is one company with the major shareholders owning almost all the shares (87.43% between Mr. Wang Weiyao & Mr. Shao Jianjun). 

I sometimes wonder what is the rationale for even keeping Word Precision listed on the SGX. The majority holders can offer a decent premium on the market price and comfortably buy out the company. The dividends they would have received in 2014 and 2015 should be more than enough to cover this acquisition!
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
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#21
Will World Precision be able to turn around from a lackluster performance in 2016, this year (2017). The share price has dropped to $0.21 and is still going without any takers. 

dydx - You have been a long term holder of World Precision and they have been extremely generous with their dividend till 2015. Last year was NIL dividend. Do let me have your take on what may be the road forward for them. In fact this is one company with the major shareholders owning almost all the shares (87.43% between Mr. Wang Weiyao & Mr. Shao Jianjun). 

I sometimes wonder what is the rationale for even keeping Word Precision listed on the SGX. The majority holders can offer a decent premium on the market price and comfortably buy out the company. The dividends they would have received in 2014 and 2015 should be more than enough to cover this acquisition!
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
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#22
Hi I have just recently collected this. Today we see some selling from merill lynch close to 400lots not sure if its from the same person. Imagine 400mil shares almost 90% locked up means left with 40mil. To be able to sell 400lots seems to be an amazing feat. I really like this companies current price valuation 0.21 equates to ard 0.39x book with very negligible debt. They have always been profitable since ipo and are able to sustain very strong operational cashflow. Have to wait for 3Q or 4Q to see whether they are willing to payout some of that cashflow or pare down their 83mil rmb of debt. Its odd that they paid up their long term borrowings first last quarter(maybe because of higher interest). See how it goes.
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#22
Hi I have just recently collected this. Today we see some selling from merill lynch close to 400lots not sure if its from the same person. Imagine 400mil shares almost 90% locked up means left with 40mil. To be able to sell 400lots seems to be an amazing feat. I really like this companies current price valuation 0.21 equates to ard 0.39x book with very negligible debt. They have always been profitable since ipo and are able to sustain very strong operational cashflow. Have to wait for 3Q or 4Q to see whether they are willing to payout some of that cashflow or pare down their 83mil rmb of debt. Its odd that they paid up their long term borrowings first last quarter(maybe because of higher interest). See how it goes.
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#23
(09-06-2017, 03:43 PM)Scg8866t Wrote: Hi I have just recently collected this. Today we see some selling from merill lynch close to 400lots not sure if its from the same person. Imagine 400mil shares almost 90% locked up means left with 40mil. To be able to sell 400lots seems to be an amazing feat. I really like this companies current price valuation 0.21 equates to ard 0.39x book with very negligible debt. They have always been profitable since ipo and are able to sustain very strong operational cashflow. Have to wait for 3Q or 4Q to see whether they are willing to payout some of that cashflow or pare down their 83mil rmb of debt. Its odd that they paid up their long term borrowings first last quarter(maybe because of higher interest). See how it goes.

Hi Scg8866t, glad to have some company in World Precision. This counter can easily give a 50% return from current levels if there is a reversal to mean in their profitability this year. Let's hope for the best  Smile
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
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#23
(09-06-2017, 03:43 PM)Scg8866t Wrote: Hi I have just recently collected this. Today we see some selling from merill lynch close to 400lots not sure if its from the same person. Imagine 400mil shares almost 90% locked up means left with 40mil. To be able to sell 400lots seems to be an amazing feat. I really like this companies current price valuation 0.21 equates to ard 0.39x book with very negligible debt. They have always been profitable since ipo and are able to sustain very strong operational cashflow. Have to wait for 3Q or 4Q to see whether they are willing to payout some of that cashflow or pare down their 83mil rmb of debt. Its odd that they paid up their long term borrowings first last quarter(maybe because of higher interest). See how it goes.

Hi Scg8866t, glad to have some company in World Precision. This counter can easily give a 50% return from current levels if there is a reversal to mean in their profitability this year. Let's hope for the best  Smile
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
Reply
#24
World precision is an schip, but it doesnt act like one.

Almost 88% owned by founder and ceo
Pays high div regularly
Doesnt hoarde cash
Have never issued rights or placement(total issued shares always fixed at 400mil)
Has always been profitable since listing
Very strong operating cashflow. Price/ebitda less than 3x.
Trades at 0.398x book but rnav is much higher as their ppe is valued at cost(they have massive hectares of land and buildings in china)

With the recent privatization of china flex and lafe, it make sense for WP to consider the same route. They are extremely iliquid and they dont raise money from the market. Why even pay the listing fees then?
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#24
World precision is an schip, but it doesnt act like one.

Almost 88% owned by founder and ceo
Pays high div regularly
Doesnt hoarde cash
Have never issued rights or placement(total issued shares always fixed at 400mil)
Has always been profitable since listing
Very strong operating cashflow. Price/ebitda less than 3x.
Trades at 0.398x book but rnav is much higher as their ppe is valued at cost(they have massive hectares of land and buildings in china)

With the recent privatization of china flex and lafe, it make sense for WP to consider the same route. They are extremely iliquid and they dont raise money from the market. Why even pay the listing fees then?
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#25
Second quarter result out

http://infopub.sgx.com/FileOpen/2Q2017%2...eID=466640

Top line up 21% qtq
Bottom line up 1.2% qtq
Gross profit up 10.5% qtq
Debt reduced from 98mil rmb to 68mil rmb
Nav up from 0.512 to 0.524

The Group’s order book stood at RMB203.6 million as at 5 August 2017 compared to 169.1mil previous quarter.

Rev surge with increasing orders in expense of some profit margin decay. Quite a good set of result, wp will likely transition to debtless by Q4 if demand continues. We should expect a div payout this year for Q3 or Q4. See how it goes.
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#25
Second quarter result out

http://infopub.sgx.com/FileOpen/2Q2017%2...eID=466640

Top line up 21% qtq
Bottom line up 1.2% qtq
Gross profit up 10.5% qtq
Debt reduced from 98mil rmb to 68mil rmb
Nav up from 0.512 to 0.524

The Group’s order book stood at RMB203.6 million as at 5 August 2017 compared to 169.1mil previous quarter.

Rev surge with increasing orders in expense of some profit margin decay. Quite a good set of result, wp will likely transition to debtless by Q4 if demand continues. We should expect a div payout this year for Q3 or Q4. See how it goes.
Reply
#26
(12-08-2017, 09:50 AM)Scg8866t Wrote: Second quarter result out

http://infopub.sgx.com/FileOpen/2Q2017%2...eID=466640

Top line up 21% qtq
Bottom line up 1.2% qtq
Gross profit up 10.5% qtq
Debt reduced from 98mil rmb to 68mil rmb
Nav up from 0.512 to 0.524

The Group’s order book stood at RMB203.6 million as at 5 August 2017 compared to 169.1mil previous quarter.

Rev surge with increasing orders in expense of some profit margin decay. Quite a good set of result, wp will likely transition to debtless by Q4 if demand continues. We should expect a div payout this year for Q3 or Q4. See how it goes.

Seems like the market does not expect any good news from World Precision, with somebody using CIMB Securities to throw down another 99 lots at upto a 52 week low of $0.185  today.

Will be keenly awaiting their 3Q17 results (3Q16 results were out on 14 Nov 2016)...
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
Reply
#26
(12-08-2017, 09:50 AM)Scg8866t Wrote: Second quarter result out

http://infopub.sgx.com/FileOpen/2Q2017%2...eID=466640

Top line up 21% qtq
Bottom line up 1.2% qtq
Gross profit up 10.5% qtq
Debt reduced from 98mil rmb to 68mil rmb
Nav up from 0.512 to 0.524

The Group’s order book stood at RMB203.6 million as at 5 August 2017 compared to 169.1mil previous quarter.

Rev surge with increasing orders in expense of some profit margin decay. Quite a good set of result, wp will likely transition to debtless by Q4 if demand continues. We should expect a div payout this year for Q3 or Q4. See how it goes.

Seems like the market does not expect any good news from World Precision, with somebody using CIMB Securities to throw down another 99 lots at upto a 52 week low of $0.185  today.

Will be keenly awaiting their 3Q17 results (3Q16 results were out on 14 Nov 2016)...
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
Reply
#27
(26-10-2017, 11:05 PM)sgmystique Wrote:
(12-08-2017, 09:50 AM)Scg8866t Wrote: Second quarter result out

http://infopub.sgx.com/FileOpen/2Q2017%2...eID=466640

Top line up 21% qtq
Bottom line up 1.2% qtq
Gross profit up 10.5% qtq
Debt reduced from 98mil rmb to 68mil rmb
Nav up from 0.512 to 0.524

The Group’s order book stood at RMB203.6 million as at 5 August 2017 compared to 169.1mil previous quarter.

Rev surge with increasing orders in expense of some profit margin decay. Quite a good set of result, wp will likely transition to debtless by Q4 if demand continues. We should expect a div payout this year for Q3 or Q4. See how it goes.

Seems like the market does not expect any good news from World Precision, with somebody using CIMB Securities to throw down another 99 lots at upto a 52 week low of $0.185  today.

Will be keenly awaiting their 3Q17 results (3Q16 results were out on 14 Nov 2016)...

In my view, that one person sell down is not an accurate reflection of the market price. As WP is currently extremely iliquid(Founder and CEO holding on to 88% of the total shares), anyone whom wish to divest would likely bring down share price substantially.

We can see that the buy and sell que is back to 0.20 0.21 today. 

Do note WP is a subsidiary of a very big conglomerate called World Group(Which has 8 subsidiaries that sells construction vehicles like excavator, agri machines etc).

Wp has never made a loss before, but I do agree that there are headwinds currently if we look at their bottom line. It seems like they are sacrificing margin to gain more market share currently. Order book stands at RMB203.6mil. 

I sometimes wonder, why even continue to list on sgx. There is almost no transaction(sometimes in a month), they do not raise money via rights or placement since ipo. Why continue to pay the $300k + annual listing fees. To each his/her own.
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#27
(26-10-2017, 11:05 PM)sgmystique Wrote:
(12-08-2017, 09:50 AM)Scg8866t Wrote: Second quarter result out

http://infopub.sgx.com/FileOpen/2Q2017%2...eID=466640

Top line up 21% qtq
Bottom line up 1.2% qtq
Gross profit up 10.5% qtq
Debt reduced from 98mil rmb to 68mil rmb
Nav up from 0.512 to 0.524

The Group’s order book stood at RMB203.6 million as at 5 August 2017 compared to 169.1mil previous quarter.

Rev surge with increasing orders in expense of some profit margin decay. Quite a good set of result, wp will likely transition to debtless by Q4 if demand continues. We should expect a div payout this year for Q3 or Q4. See how it goes.

Seems like the market does not expect any good news from World Precision, with somebody using CIMB Securities to throw down another 99 lots at upto a 52 week low of $0.185  today.

Will be keenly awaiting their 3Q17 results (3Q16 results were out on 14 Nov 2016)...

In my view, that one person sell down is not an accurate reflection of the market price. As WP is currently extremely iliquid(Founder and CEO holding on to 88% of the total shares), anyone whom wish to divest would likely bring down share price substantially.

We can see that the buy and sell que is back to 0.20 0.21 today. 

Do note WP is a subsidiary of a very big conglomerate called World Group(Which has 8 subsidiaries that sells construction vehicles like excavator, agri machines etc).

Wp has never made a loss before, but I do agree that there are headwinds currently if we look at their bottom line. It seems like they are sacrificing margin to gain more market share currently. Order book stands at RMB203.6mil. 

I sometimes wonder, why even continue to list on sgx. There is almost no transaction(sometimes in a month), they do not raise money via rights or placement since ipo. Why continue to pay the $300k + annual listing fees. To each his/her own.
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#28
IPO in 2006 at $0.36
co raised SGD $36mil by selling 100m new shares at $0.36. (side note: owner pocketed SGD $1.8 on 5mil vendor shares)

dvds:

2006: $0.096 CNY
2007: $0.087 CNY
2010: $0.15 CNY
2011: $0.119 CNY
2012: $0.027 SGD
2013: $0.01 SGD
2014: $0.1625 CNY
2015: $0.225 CNY
2016: $0.125 CNY

total dvds = $0.9645 CNY + $0.037 SGD

For simple calculations, assuming 1SGD  to 4.8CNY  fx rate,
total dvds: $0.238 SGD

assuming you bought in at ipo S$0.36, collected dvds of S$0.238

last done stock price 0.144 SGD.

simple net return $0.022/$0.36 = TOTAL 6.1% after 12 years

as for the owners:

their cost price is S$0.06. they too collected S$0.238 dvds.

As of last AR, the 2 owners owned about 87%+ of shares.

Dvd payout generous?

Gem or Trap?
Reply
#28
IPO in 2006 at $0.36
co raised SGD $36mil by selling 100m new shares at $0.36. (side note: owner pocketed SGD $1.8 on 5mil vendor shares)

dvds:

2006: $0.096 CNY
2007: $0.087 CNY
2010: $0.15 CNY
2011: $0.119 CNY
2012: $0.027 SGD
2013: $0.01 SGD
2014: $0.1625 CNY
2015: $0.225 CNY
2016: $0.125 CNY

total dvds = $0.9645 CNY + $0.037 SGD

For simple calculations, assuming 1SGD  to 4.8CNY  fx rate,
total dvds: $0.238 SGD

assuming you bought in at ipo S$0.36, collected dvds of S$0.238

last done stock price 0.144 SGD.

simple net return $0.022/$0.36 = TOTAL 6.1% after 12 years

as for the owners:

their cost price is S$0.06. they too collected S$0.238 dvds.

As of last AR, the 2 owners owned about 87%+ of shares.

Dvd payout generous?

Gem or Trap?
Reply
#29
Interesting announcement from World Precision on 04-Sep-2020 at 17:34:28

1. INTRODUCTION
Further to the announcements dated 20 April 2020, 28 April 2020 and 7 August 2020, the Board of Directors (the “Board”) of World Precision Machinery Limited (the “Company”, and collectively, the Company and its subsidiaries, the “Group”) would like to announce that World Precise Machinery (Shenyang) Co., Ltd., a wholly-owned subsidiary of the Company incorporated in the People's Republic of China (the “Seller”), has entered into a sale and purchase agreement with World Agriculture (Shenyang) Co., Ltd. (the “Buyer”) on 4 September 2020 (the “SPA”), pursuant to which the Seller has agreed to sell, and the Buyer has agreed to acquire, all the shareholding interest in Shenyang World High-End Equipment Manufacturing Co., Ltd (the “Target Company”), a wholly-owned subsidiary of the Seller, on the terms and subject to the conditions of the SPA (the “Proposed Sale”). By purchasing all the shareholding interest in the Target Company, it is intended that the Buyer will acquire all of the factory buildings and land associated with such factory buildings owned by the Target Company (the “Sale Property”). The Buyer is a corporation incorporated in the People's Republic of China and is a wholly owned subsidiary of Jiangsu World Agriculture Machinery Co., Ltd. (“JWAMCL”).

2. RATIONALE AND BENEFIT TO THE COMPANY 
When the Group planned and constructed the factories in Shenyang, the Group's strategy then was for the Shenyang factories to undertake the manufacturing, supply, installation and servicing of stamping machines to automobile manufacturers in the North Eastern region of China. There has been a shift in the Group's strategy, where the Shenyang factory is utilised only for the supply, installation and servicing of stamping machines, but will not be undertaking the manufacturing of stamping machines. Accordingly, the factory buildings which have been constructed are in excess of the business requirements of the Group. As at the date hereof, the Group owns four (4) factory buildings on the property in Shenyang, of which, the Group is utilising one (1) factory building for the Group’s business. The Sale Property comprises 3 factory buildings, 1 of which has been rented out to the Buyer since construction of the factory building was completed in 2014, and construction of the other 2 factory buildings have only just been recently completed.

3. USE OF SALE PROCEEDS 
The consideration for the Proposed Sale is to be in cash only, and such proceeds, when received, can then be applied towards the working capital of the Group, or for other purposes as may be determined by the Board.

4. SALIENT TERMS OF THE SPA 
The terms and conditions of the SPA were negotiated and agreed upon by the parties on an arm’s length basis. A summary of the principal terms of the SPA is set out below:

© Sale Consideration: RMB 263,143,415.97 which consists of market value of the Sale Property RMB 250,097,600.00, applicable value added tax of the Sale Property RMB 12,045,815.97 when transferred to the Target Co, and share capital of Target Company of RMB 1,000,000 (the “Sale Consideration”)

Now the interesting part is that the sale consideration of $49,889,044.08 (Market value of the Sale Property) is 71% of the current market cap of World Precision ($70.4 mil). So you have a fully functioning business with all required assets to carry out that business available for about $20 mil (i.e. $0.05 per share). WP had declared a dividend of $0.01 for 2019 and we can safely expect a similar dividend this year as well and maybe a Special Dividend as well  Big Grin 
 
https://links.sgx.com/1.0.0/corporate-an...10bc77917a
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
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#29
Interesting announcement from World Precision on 04-Sep-2020 at 17:34:28

1. INTRODUCTION
Further to the announcements dated 20 April 2020, 28 April 2020 and 7 August 2020, the Board of Directors (the “Board”) of World Precision Machinery Limited (the “Company”, and collectively, the Company and its subsidiaries, the “Group”) would like to announce that World Precise Machinery (Shenyang) Co., Ltd., a wholly-owned subsidiary of the Company incorporated in the People's Republic of China (the “Seller”), has entered into a sale and purchase agreement with World Agriculture (Shenyang) Co., Ltd. (the “Buyer”) on 4 September 2020 (the “SPA”), pursuant to which the Seller has agreed to sell, and the Buyer has agreed to acquire, all the shareholding interest in Shenyang World High-End Equipment Manufacturing Co., Ltd (the “Target Company”), a wholly-owned subsidiary of the Seller, on the terms and subject to the conditions of the SPA (the “Proposed Sale”). By purchasing all the shareholding interest in the Target Company, it is intended that the Buyer will acquire all of the factory buildings and land associated with such factory buildings owned by the Target Company (the “Sale Property”). The Buyer is a corporation incorporated in the People's Republic of China and is a wholly owned subsidiary of Jiangsu World Agriculture Machinery Co., Ltd. (“JWAMCL”).

2. RATIONALE AND BENEFIT TO THE COMPANY 
When the Group planned and constructed the factories in Shenyang, the Group's strategy then was for the Shenyang factories to undertake the manufacturing, supply, installation and servicing of stamping machines to automobile manufacturers in the North Eastern region of China. There has been a shift in the Group's strategy, where the Shenyang factory is utilised only for the supply, installation and servicing of stamping machines, but will not be undertaking the manufacturing of stamping machines. Accordingly, the factory buildings which have been constructed are in excess of the business requirements of the Group. As at the date hereof, the Group owns four (4) factory buildings on the property in Shenyang, of which, the Group is utilising one (1) factory building for the Group’s business. The Sale Property comprises 3 factory buildings, 1 of which has been rented out to the Buyer since construction of the factory building was completed in 2014, and construction of the other 2 factory buildings have only just been recently completed.

3. USE OF SALE PROCEEDS 
The consideration for the Proposed Sale is to be in cash only, and such proceeds, when received, can then be applied towards the working capital of the Group, or for other purposes as may be determined by the Board.

4. SALIENT TERMS OF THE SPA 
The terms and conditions of the SPA were negotiated and agreed upon by the parties on an arm’s length basis. A summary of the principal terms of the SPA is set out below:

© Sale Consideration: RMB 263,143,415.97 which consists of market value of the Sale Property RMB 250,097,600.00, applicable value added tax of the Sale Property RMB 12,045,815.97 when transferred to the Target Co, and share capital of Target Company of RMB 1,000,000 (the “Sale Consideration”)

Now the interesting part is that the sale consideration of $49,889,044.08 (Market value of the Sale Property) is 71% of the current market cap of World Precision ($70.4 mil). So you have a fully functioning business with all required assets to carry out that business available for about $20 mil (i.e. $0.05 per share). WP had declared a dividend of $0.01 for 2019 and we can safely expect a similar dividend this year as well and maybe a Special Dividend as well  Big Grin 
 
https://links.sgx.com/1.0.0/corporate-an...10bc77917a
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
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#30
Indeed interesting.
Massive expansion by 2014.
Growth stalled after expansion.
Rent out to his private co. after that.
6 yrs later to sell it to his private co. Close to the amount paid by world prescision.
Look like his private co are doing well...
High dividends over the years.

If world precision dividend out the consideration. Then his private co. Pay close to nothing for it.

If the majority owner has low regards on world precision then this is a cheap way to fund his promising private co.
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#30
Indeed interesting.
Massive expansion by 2014.
Growth stalled after expansion.
Rent out to his private co. after that.
6 yrs later to sell it to his private co. Close to the amount paid by world prescision.
Look like his private co are doing well...
High dividends over the years.

If world precision dividend out the consideration. Then his private co. Pay close to nothing for it.

If the majority owner has low regards on world precision then this is a cheap way to fund his promising private co.
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