Sinostar petrochemicalPhoto: Company
The following is adapted from Joseph Yeo's post on 8 Dec 16 in the NextInsight forum. Since then, the share price has risen 29.7% from 11.8 cents to 15.3 cents.

I find this company interesting, under-valued and neglected ... generally, outside the radar of most investors.


Below are interesting data about the company:

ABOUT SINOSTAR PEC 

♦ One of the largest producers and suppliers of downstream petrochemical products within the 400km radius of its production facilities within the Dongming Petrochem Industrial Zone in Dongming County of Shandong Province, PRC.

♦ Located within the Zhongyuan Oilfield - one of the PRC’s largest oil fields, rich in energy resources and connected by a comprehensive logistics network.
Its strategic placement permits it to serve the nearby populous and industrialised provinces such as Shandong, Henan, Anhui, Shaanxi, Hebei, Hubei and Zhejiang.

1.  zero debt

2. cash horde of S$95 mil

3. market cap at S$76 mil based on current stock price of 11.8 cts

4. profitable in the last 9 quarters.

5. last financial year (2015) profit was S$8.1 mil

6. current year (2016) 9-month profit is S$14.3 mil. This is 76.5% higher than the whole of last year.

7. NTA is 18.6 cts

8. PE (price earning ratio) for 9 mths is 5.3. If current profit trend continues, the forward p/e would be less than 4

9. Cash backing per share is 15.5 cts.

LQM E57322Yes, there is a stigma on S-chips, but from my many years of investing, I have noted that most scandalous S-chips were hot stocks before the scandals surfaced and normally within 5 years of listing.

Sinopec was never a hot stock and have been listed since 2007 ... 10 years. So I am quite comfortable with it.


The major shareholder bought shares in the open market on 4 occasions this month. At the current price, the stock is still trading below its cash value of 15.5 cts per share.

Company has no debt. Its profit for 9 mths current is S$14.3 mil. This implies a forward p/e of less than 4. To me, it's still undervalued. 

-- Joseph Yeo

10. Dividend of 0.5 cts per share

11. Dividend yield is above 4%


12. Recently, major shareholder (non-executive chairman) has been buying shares in the open market.

My view: This company is grossly under-valued. It's trading below its cash level, it has a dividend yield of above 4%.

Major shareholder buying back shares, stock is trading below NTA, company has been profitable in the last 4 quarters, has no debt, and management sounds confident of its ability to maintain outperformance.

Above for sharing only, not an encouragement to buy or sell. I am heavily vested.

You may also be interested in:


You have no rights to post comments

Counter NameLastChange
AEM Holdings2.2400.100
Avi-Tech Electronics0.265-
Best World1.6800.050
Broadway Ind0.0950.008
China Sunsine0.4000.010
ComfortDelGro1.3600.010
Delfi Limited0.965-
Food Empire1.440-
Fortress Minerals0.280-
Geo Energy Res0.3400.010
GSS Energy0.026-0.001
Hong Leong Finance2.480-
Hongkong Land (USD)3.240-0.140
InnoTek0.445-0.005
ISDN Holdings0.315-0.005
ISOTeam0.035-
IX Biopharma0.045-
Jiutian Chemical0.025-
KSH Holdings0.250-
Leader Env0.050-0.001
Medtecs Intl0.130-0.002
Nordic Group0.3400.005
Oxley Holdings0.091-
REX International0.1340.001
Riverstone0.6850.010
Sinostar PEC0.138-0.002
Southern Alliance Mining0.600-
Straco Corp.0.500-0.030
Sunpower Group0.220-0.010
The Trendlines0.085-
Totm Technologies0.023-
Uni-Asia Group0.815-0.025
Wilmar Intl3.3300.010
Yangzijiang Shipbldg1.7900.040
 

We have 670 guests and no members online

rss_2 NextInsight - Latest News