Qingmei

greenrookie
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Elite Member

12 years 7 months ago #7270 by greenrookie

Replied by greenrookie on topic Re:Re:Qingmei

Viviene, if chairman Su opt for all of scrip, he is losing / forgoing about 10 million as he owns 61% of the company. He is not net exiting. In the short run, price should improve if the overall Market doesn't sour too much, and that whoever is the investors should have already seen the audited books, so the account should be ok. I am however, very uncomfortable with the whole episode. First. 0.185 is the lowest price since announcement of full year results, and he still sells at a discount of 9%, most of the time after the announcement, qingmei is trading at 20 cents, assume he negotiate the deal after the sterling results is known (for more bargaining power) he is willing to sell qingmei at close to 20% discount? why on earth would he want to do that? If he need cash, He just have to opt for half cash half shares and the cash proceeds would exceed the 3 million he is getting now. Also, as the stake is less than 5 %, there is no need to make known who the investors are, but I thought these are very material information and the company should make known to investors to whom are he giving such a sweet deal to. Are they fund managers or just businessmen he knows? Being shrouded in secrecy made me uneasy. I will seriously consider if I want to buy back the shares although the price is really super attractive now. The dividend yield is now over 14%. another not so impt pt, after converting his dividends to scrip, the shares will increase by 10% assuming conversion price of 17.5 cents. If more opt for scrip, there is further dilution, not so sure about the company future earning strength esp company will suffer a whammy of losing the prefertial tax rate. Not sure the earning growth can offsets all these. Also there is no more information about the company dividend policy as the 30% profits to be given as dividends will lapse after this year.

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blancfable
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12 years 7 months ago #7271 by blancfable

Replied by blancfable on topic Re:Re:Re:Qingmei

It doesn't make sense for a chairman to liquidate his holdings when he can expect a dividend of over 14%. I will avoid this stock for sure.

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ethan999
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12 years 7 months ago - 12 years 7 months ago #7273 by ethan999

Replied by ethan999 on topic Re:Qingmei

Not vested in Qingmei as I don't like their IR standard but I've been keeping track of it as I was impressed at how the share price held up reasonably well during the recent market turmoil, not going below its June low of 18.5 cents or so unlike most other stocks which are well into their 52-week lows. This was of course the case only until the recent marriage deal by Chairman Su.
In my opinion it is most likely that Chairman Su is opting for script dividends because he wants Qingmei to retain a greater portion of its net profits in the form of cash. By opting for script dividends, the company retains about 60% of the cash it would otherwise have paid for in dividends. In a sense this is good for the company despite the dilution in shares, but it would depend on what exactly it intends to do with this extra retention of cash.

Last edit: 12 years 7 months ago by ethan999.

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cheongwee.
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12 years 7 months ago #7274 by cheongwee.

Replied by cheongwee. on topic Re:Qingmei

Instead of guessing, why not you all ask him during the AGM.
dont anyhow guess,
I see at least he show confident in the coy by going for scrip, and he gain more by going for the srcip against the share he sold.
Better ask him during AGM, see how he answer.
interested non invester.

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cheongwee.
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12 years 7 months ago #7275 by cheongwee.

Replied by cheongwee. on topic Re:Re:Qingmei

I hope you dont mind, the boss hold 65%(now 60) of the share and the daily transaction vol is too low to access anything, not to say anything about the counter. So how you get impress with the stable px is beyond my understanding??? And thgis stock is not liquid.
And with today mkt, who want to sell, the px is too low, and for buyer, who want to buy, for who know what the morrow will bring, maybe even cheaper, so everyone is wait and see. nobody is willing to buy, not to say this counter, there are many good counter out there facing the same situation.
Better go ask the Su, than to beat around the bush.

[hr]
[ethan999 07-10-2011]:

Not vested in Qingmei as I don't like their IR standard but I've been keeping track of it as I was impressed at how the share price held up reasonably well during the recent market turmoil, not going below its June low of 18.5 cents or so unlike most other stocks which are well into their 52-week lows. This was of course the case only until the recent marriage deal by Chairman Su.
In my opinion it is most likely that Chairman Su is opting for script dividends because he wants Qingmei to retain a greater portion of its net profits in the form of cash. By opting for script dividends, the company retains about 60% of the cash it would otherwise have paid for in dividends. In a sense this is good for the company despite the dilution in shares, but it would depend on what exactly it intends to do with this extra retention of cash.

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observer2
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12 years 7 months ago #7277 by observer2

Replied by observer2 on topic Re:Qingmei

In a news release, Qingmei announced that Chairman Su sold 23 million shares (about 3.6%) to private investors at 16.85 cts (discount of about 8.9% to market price) to enhance liquidity and to meet investors’ demand for the Group’s shares. Chairman Su would also be opting for scrip in the script dividend scheme. This should remove some anxiety among shareholders over the private placement issue.
Although the Chairman’s holdings would be reduced by 23 million shares following the private placement, the script dividend would later add well over 50 million shares to his holdings this year. The issuing of script dividend is not sustainable in the longer term if too many scripts are issued resulting from low share price cum high dividend payment. Qingmei then may have to reduce its dividend payout or boost up its share price to a much higher level.
Among the penny stocks, it is difficult to find another stock with such low valuation and high dividend yield as Qingmei. However, I foresee Qingmei’s growth prospects reaching its height after the completion of its second phase expansion next year. With the current spade of severe sell down in the market, I am looking for opportunities to divest all my stake in Qingmei to move into other better growth stocks perceived as having lower downside risks and higher potential capital gain than this one.

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