Market Commentary On Selected Stocks

Its a tough market this month, many combustions, IPOs and then Muhibbah, followed by MAA and out of the blue TimedotCom. Sigh, if listen to the mantra to stay away from May onwards, many of us would have lost a lot less if we went to play golf everyday.



TimedotCom
Shares slumped after its major shareholder fixed the offer for sale of the shares at a sharp discount. Time fixed the renounceable offer for sale of up 626.18 million shares of Time dotCom at 53 sen. The offer price of 53 sen was 33.75% below the five-day volume weighted average market price up to June 17. The offer for sale is on the basis of eight offer shares for every 10 shares held in Time Engineering held as at 5pm on July 5. Time dotCom’s net asset per share was 55 sen as at March 31, 2011. It reported net profit of RM22.88 million on the back of RM70.60 million in revenue in the first quarter ended March 31, 2011.

This one was overdone a bit, yes the price was a lot lower, and certainly shouldn't it be 10% discount to the 5 day weighted average and not 33.75%? Big picture, its a good company now with its new assets. Expect a ginger climb back to sanity.

MAA
Read my posting yesterday.

Muhibbah

Muhibbah made an announcement:

With reference to the articles in the Singapore Business Times on 15 June 2011 regarding the appointment by CIMB (the financier of APH project) of receivers and managers for APH, the Company wishes to inform that according to APH, they have identified an investor, and are in negotiations with the investor to fully finance the completion of the APH Project, including making due payments to contractors.

As this is a oil and gas project with a secured business and the said investor due to finalise its financing transaction with APH, there are reasonable grounds to hold that the receivables are recoverable in due course.

Selling is overdone. For such a big project with decent prospects, it should not be difficult to offload to another investor. Will be volatile though. Won't climb back to RM1.80 anytime soon, may find fair value around RM1.55. But do you want to hold onto a stock with so much uncertainty, what if the new investor does not eventuate. Should exit when gets closer to fair value.



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