Man Wah - A multi-bagger in the making?

Gary Teh
Offline
Elite Member

15 years 2 months ago #1122 by Gary Teh

Replied by Gary Teh on topic Re:Man Wah - A multi-bagger in the making?

How would you rate the management of Man Wah?? I was about to put real money into Man Wah until he tired the stupid stunt of overpaying for Famous Bedding with Man Wah shares which I thought hurt the credibility of their management significantly. Just makes me wonder what is the next stunt they will pull off.

Please Log in or Create an account to join the conversation.

scbchan
Topic Author
Offline
Senior Member

15 years 2 months ago #1125 by scbchan

Replied by scbchan on topic Re:Man Wah - A multi-bagger in the making?

The Famous Bedding acquisition was planned in Q2 and Q3 2008 when Man Wah was trading at 23-30 cents. At this price level, the acquisition would make sense to me. I don\'t think the management could foresee the almost total collapse of market prices towards end of 2008 when the market average price would be based on. I won\'t fault the management for this.

Please Log in or Create an account to join the conversation.

Gary Teh
Offline
Elite Member

15 years 2 months ago #1126 by Gary Teh

Replied by Gary Teh on topic Re:Man Wah - A multi-bagger in the making?

Hi scbchan, The acquisition price based on Famous Bedding forward PE was the issue if I remember correctly. What is your opinion on the management whether they are shareholder friendly or otherwise?? Rate them from a scale of 1-10. 10 being best and it goes down from there.

Please Log in or Create an account to join the conversation.

scbchan
Topic Author
Offline
Senior Member

15 years 2 months ago #1127 by scbchan

Replied by scbchan on topic Re:Man Wah - A multi-bagger in the making?

Hi Gary Management has been open and straightforward. Just to name a few examples: - Their IPO price was set at 4.5x historical PE in 2005, a very reasonable figure for new shareholders. - They have been conservative in their expansions - issued new shares in 2006 instead of borrowing via convertible bonds. - They have been consistent with their guidance and announcement. Apart from management attitude to shareholders (and potential investors), they are also smart. Just contrast their strategy with HTL: - They set up a Macau gateway for export business before this \"opportunity\" is closed to others. Result: all export profit is tax free. - They set up a direct sales and service team in the US to sell to big retailers. Result: very low selling price and not controlled by wholesalers. - They tookover the running of Cheers stores in major PRC cities, retaining the retail margins as well as getting first hand feedback from customers on demand trends. These are just a few smart things management did which translated to positive results even during the current downturn. This to me is the testimony of good management. I will give a 9 rating. 10 is impossible since everyone has areas for improvement.

Please Log in or Create an account to join the conversation.

Gary Teh
Offline
Elite Member

15 years 2 months ago #1128 by Gary Teh

Replied by Gary Teh on topic Re:Man Wah - A multi-bagger in the making?

Hi SCB Chan, wow that is indeed a very good in-depth independent assessment of Man Wah\'s management credibility. being in the worse industry in the worse of times they still came out with flying colors. Wonder what the stock will do if these were normal times.

Please Log in or Create an account to join the conversation.

scbchan
Topic Author
Offline
Senior Member

15 years 2 months ago #1223 by scbchan

Replied by scbchan on topic Re:Man Wah - A multi-bagger in the making?

Financial PR have spoken to OCBC and clarified the issue of one-off gains I raised: - the \"one-off gains\" refers only to the changes in fair value of derivative financial instruments (forex arbitrage), as they felt that this is a non-operational item. By excluding the HK$3.5 mil(3QFY09) and HK$1.3 mil(3QFY08) respectively, that\'s how the 10% earnings growth is derived. - in the analysis, they do not consider the depreciation change in making the estimate. So when OCBC said \"one-off gains\", they mean non-operational items. They ignore exchange gains/losses and the one off change in depreciation policy. Is this an ordinary use of the term \"one-off\"?

Please Log in or Create an account to join the conversation.

Time to create page: 0.225 seconds