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a section from recently issued S&P report:
"Our 2010 earnings estimate is unchanged but we have marginally reduced our 2011 estimate by 3% to account for slower sales growth to the HDD sector, partially offset by quicker growth in sales to the other sectors , i.e. Other Electronics, Telecom and Non-Electronics. We believe HDD manufacturers may lose some market share to solid state drive (SSD) makers, as the SSD becomes more popular.
While the HDD remains the primary medium for data storage, we note the rapid emergence of SSDs in the consumer market, driven by the increasing popularity of mobile devices such as smartphones and media players. Most recently, Apple created waves with its latest
MacBook Air ultraportable notebook computer, which uses a SSD instead of a traditional HDD."
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Suppose the SSD makers if they do not produce HDD too will be the new customers.
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10-12-2010, 07:14 PM
(This post was last modified: 10-12-2010, 08:53 PM by dydx.)
Today (10Dec10), Adampak advanced another $0.01 and closed at $0.32, with quite good volume (341 lots), and most of the transactions were by buyers taking from sellers at their 'offer' prices. A good sign I think.
Shareholders should be pleased to note that Adampak has out-performed the SG market average (as measured by the STI) consistently since Jul09, and by quite a nice margin.....
http://finance.yahoo.com/q/bc?s=5EZ.SI&t...l&c=%5ESTI
As the 5-year price chart only reflects the share price relative to the market index, it does not give a complete picture of total shareholder return. Of course, we must add all the good and increasing, twice-a-year dividends Adampak has paid out since 2005. Simply awesome!
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Today (3Jan11) is the first market day of 2011. Adampak has started the day with a long 'BUY' queue, versus only one solo seller of 10 lots at $0.355. It is indeed heartening to see that in this new year Adampak shareholders have increased their resolve to hold on to their highly valuable shares!
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Hi dydx,
Adampak hit $0.36 yesterday and closed at $0.35 today.
I notice that comparisons have been drawn between Adampak and Unisteel (which was privatized in 2008). Brokers Lim and Tan, in their report dated 20 May 2010 even stated that Adampak reminds them of Unisteel. So it would seem that because of similarities, Adampak is also a likely candidate for privatization (although no one can ever be sure, I know).
I'm just dreaming here - I think Unisteel was privatized for $1.95. Do you think that it is far-fetched to hope for such a high offer price for Adampak?
Vested.
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(05-01-2011, 07:09 PM)julianbream Wrote: I'm just dreaming here - I think Unisteel was privatized for $1.95. Do you think that it is far-fetched to hope for such a high offer price for Adampak?
I think your hope that Adampak could be privatized by an offer at $1.95/share is really a dream! May be a deal at such a high price could happen after Adampak chalks up another 5 to 8 years of consistent, solid growth?
At today's (5Jan11) closing price of $0.35, and based on Adampak's 263.635m issued shares, market cap. now stands at $92.27m. IMHO, this is not too high at all, when compared with the present scale of the business - revenue, profits and FCF - and bearing in mind the business is of very high-quality and growing nicely, and there is a large nett cash reserve within the company. Any party making an offer to privatize Adampak must recognize all the above, and needless to say Adampak's controlling shareholders should understand the same very well.
Usually a privatization offer from a 3rd-party happens only to high-quality and well-managed businesses, and I believe that Adampak certainly meets this key criterion.
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Hi dydx,
Thanks for your input on my question.
Well, though such an offer price might be quite improbable now, I think the important thing to me is that it’s not impossible if things turn out as you describe for the company. Always nice to dream anyway! 
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I just did some simple calculations on the total returns delivered by Adampak in 2009 and 2010 for those longer-term, buy-and-hold investors.
Based on the year-end closing share prices of $0.18 (31Dec08), $0.24 (31Dec09), and $0.33 (31Dec10), and the total (twice yearly) dividends received of $0.0175/share (in 2009) and $0.025/share (in 2010), total annual return - i.e. derived from appreciation of the share price and dividends received in a calender year - from Adampak was 43.06% in 2009, and 47.92% in 2010. Total return over the 2-year period (2009 and 2010) was 106.94%. Simply superb!
http://finance.yahoo.com/echarts?s=5EZ.S...=undefined
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Now I’m not dreaming but making some projections with some very very conservative assumptions:-
1) 2010 NPAT comes in at USD 10,000,000 (reasonable given 3Q results?)
2) NPAT grows only at 10% per annum for 2011 to 2015 (I think this should be conservative cos apart from declines in NPAT of 5% and 4% in 2008 and 2009 respectively - due to the world economic downturn -, NPAT grew 61% and 24% in 2006 and 2007 respectively)
3) USD to SGD exchange rate falls to an average rate of 1.2 (wow!)
4) PE ratio is 8 (conservative for a good company like Adampak)
Using all the above assumptions and crunching the numbers, the share prices implied by the respective years’ accounting numbers are as follows:-
2010: 36 cents
2011: 40 cents
2012: 44 cents
2013: 48.5 cents
2014: 53 cents
2015: 58.5 cents
If you adjust upwards for any of the assumptions made and these implied share prices escalate even higher!
Any comments from fellow forumers?
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