Here is another home-grown company which is under transformation into a regional power player which maybe worth monitoring.
Currently I do not have any vested interest but will be keen to add on to my portfolio when the price is right.
Revenue for power related business grown from $24.9 million in FY08 to $37.5 million in FY09.
While there is no breakdown of profit from the different business segment. It's annual report stated that; Profit from Operations increased by about 21% to S$5.00 million from S$4.13 million mainly due to higher margin on sale for the fire division and increased income contributions from the power generation division.
Following is the press released issued on the 1st July 2009.
Asiatic Group (Holdings) Limited (Asiatic, the Group), an emerging power play in Asia Pacific, has secured a US$20 million financing facility through its subsidiary, Colben Energy Holdings (PPSEZ) Ltd (CEHZ), to support its power project in Cambodia.
Asiatic will, via CEHZ, hold a direct stake of 49% in the operating company set up under the Joint Venture in Cambodia to manage the power plants in Phnom Penh Special Economic Zone (PPSEZ) and has the right to exercise an option to increase it stake to about 70%.
The facility agreement was signed with a consortium of financial institutions: ASEAN Finance Corporation Limited, Cambodia Mekong Bank Public Limited, Maybank International (L) Ltd, Krung Thai Bank Public Company Limited, Singapore Banking Corporation and United Overseas Bank Limited. The funds will be used to finance the construction and operation of Asiatic's 20MW power project in the PPSEZ.
Then on 13th July 2009
Asiatic Group (Holdings) Ltd's wholly owned subsidiary, Colben Energy Holdings (Vietnam) Ltd, will be tying up with two new partners to continue the rollout of its hydroelectric power plant project in Vietnam, which was first announced last year. Colben will now link up with two highly established groups -- Vietnam Infrastructure Development and Finance Investment JSC (VIDIFI) and HVD Construction and Investment Consultants JSC (HVD) -- to jointly develop, design, build, own and operate the plant. The 44MW project will be completed in two phases, with 33MW of capacity coming onstream under Phase 1 and the remaining 11MW under Phase 2.
Venture also marks Group's first energy foray outside Cambodia and will advance its plans to become major player in this sector across Asia
Then on the 12th October 2009;Asiatic Group (Holdings) Ltd (Asiatic or the Group), through its wholly-owned subsidiary, Colben Energy (Singapore) Pte Ltd (Colben), has agreed to take a 30%-stake in a joint venture (JV) company to develop the Group's first biomass power plant, marking its first foray into Malaysia's renewable energy sector. Move steps up Asiatic's efforts to be one of Asia leading independent power producers and a major player in renewable energy power generation It will be interesting to monitor to see how it can duplicate its success in Cambodia in the Vietnam and Malaysia venture.
Successful transformation will make it a company which generate stable recurring income for its shareholders as compare to it's current fire fighting and protection business.
Last edit: 10 years 4 months ago by min1xyz. Reason: Formatting
I think it\'s in a safe industry. The projects are capital intensive and they are still in the Work In Progress phase. I agree we can monitor this company but I feel it\'s still a long time before the projects deliver strong earnings. At present, the valuation of the stock not exactly cheap : historial PE about 8.5X. Market cap teeny weeny at $30 million.
PE of 8.5 is cheap..will fair value is 12.0... entry barriers for power generation business are high.. Revenue visibility is already there...did you buy at low of 4 cents per share in beginning of this year.. you will still think it was expensive at that tiome cos\' market sentiment was bad- I was buying then..cheers !!!
This Company lacks the one ingredient to be a renewable energy player --- MONEY. You need huge upfront investments to build the water / wind plants. Asiatic is such a small company. If they cannot even be a leading player in Asia in the fire protection sector which is their bread and butter, why should I believe the management when they are venturing into a totally new business ?? Crap!
Big companies look at huge projects. Niche players look at smaller projects that big companies avoid. If you do not believe in Management (or have no knowledge of the business and the team), then don\'t invest in this company. Move on to other companies - it is definitely not for you...
