(13-08-2014, 10:06 AM)simpleman Wrote: [ -> ]Portuser
Sunsine is now producing steam from small boilers. Installing central boilers to supply steam to its own factory and other factories in the industrial zone seems to make sense.
But why should Sunsine generate electricity:
“ Based on our needs for steam supply, our current steam cost, the requirements of Local Government, the results of the Feasibility Study, and the fact that it is customary practice in the PRC that users of steam pay the charges upfront before usage, and that the State Grid will purchase the by-product which is electricity from CHC which should ensure healthy cash-flow from operations, the Board is of the view that it is in the best interest of the Group to undertake the Project and for Shandong Sunsine to establish a New Subsidiary to operate the same.” (Sunsine Announcement on 30th Dec 14)
Sunsine does not generate electricity now. I presume a large part of RMB 150m project cost is for electricity generation. Why not produce steam only to keep the project cost low and reduce bank borrowings?
Cogeneration of steam and electricity is an efficient use of fuel, and reduces carbon emissions. If electricity can be sold to the grids, the cost of steam generation will be lowered.
Unfortunately many electricity grids are used to dealing with large power stations, and are reluctant to get involved with small electricity generation outfits.
Willingness of the Chinese National Grid to buy electricity generated from Sunsine’s central boiler enables Sunsine’s factory to save RMB 15m a year. There is also profit from selling steam to other factories in the chemical industrial zone.
Mr Market does not seem to believe in the purported higher cost efficiency from the centralized production of steam..
Grateful if valuebuddies can help to flag out any possible red flags for sunsine.
(e.g. any similarity with Foreland FabricTech?)
tks.
(14-08-2014, 08:02 PM)Curiousparty Wrote: [ -> ]Grateful if valuebuddies can help to flag out any possible red flags for sunsine.
(e.g. any similarity with Foreland FabricTech?)
tks.
Do you mind answering Adigo's questions at post #340 first?
Investment is individual choice, if you don't feel good about sunsine you are free to divest. We thank you for raising concern but your relentless talking down of sunsine appears that you have an agenda, haven't you?
Don't mind me asking, are you trying to generate panic selling in order to collect low?
If a counter is "real solid Gold", it will be able to stand up to any scrutiny, criticisms, etc.
It is by talking out and sharing that blind spots will be revealed. I have learnt this method over the years...
(And we have to talk in specific terms. use hard facts and figures to support any argument)
If there is anything uncertain or unsure about a counter (e.g. CES, etc), feel free to scrutinize, critircize and point out all its problems.
it is always better to talk it out, rather than to keep within oneself thinking that "the problem will go away by itself".
(IMHO).
Many tks.
Yes, I bought some to "punt" since the price was cheap at 20 cents, and I don't have much to lose...
(so yes, I have to admit that it was kind of a gambling mentality - not a good example to follow...)
I bought from 23 cents all the way to below 20 cents. My last purchase was around 18 or 19 cents.
I have some understanding of its businesses but not comprehensive enough.........
Some of the "actions" of the company seemed kind of baffling though.... (e.g. front loading of expenditure in one of the FYs so that the profit appeared lower than it should be; venturing into hotel management; have not been doing share buyback despite the share being so "undervalued";etc)
If the company thinks the share price can go to 65 cents (as taunted by one of the analysts), isn't the current share price of 31 cents dirt cheap? If so, why don't buy back its own shares??
The best signal a company can give to its loyal shareholders is to buy back its own shares from the market using "cold hard cash" in substantial amt (instead of leaving this cash in bank for "show") if the company is indeed confident about the prospect...
(13-08-2014, 10:39 AM)Adagio Wrote: [ -> ]Hi Curiousparty,
I am confused by your two statements:
“This world is interesting. There are so many examples of S-chips going sour but people just don't "learn", always thinking that this time round, this S-chip is different.”
“My average price is low 20 cents. If price drops below 30 cents, I will fully divest the remaining portion I have.”
If you hold the view that the probability of a S-chip getting into trouble is high, why did you buy Sunsine in the first place? Why are you still holding on to the shares? What made you think that, in your own words, “this time round, this S-chip Sunsine is different.”
Did you buy just to punt?
Thank you.
Hi Curiousparty
You said you have some understanding of its businesses but not comprehensive enough.........
You added that some of the "actions" of the company seemed kind of baffling though.... (e.g. front loading of expenditure in one of the FYs so that the profit appeared lower than it should be; venturing into hotel management; have not been doing share buyback despite the share being so "undervalued";etc)
You could perhaps provide details of the front loading of expenditure – when did it take place, the nature of the expenditure and amount?
Since you have so many doubts about Sunsine (to the point of comparing it with China FabriTech) but chose to hold on to the shares, did you attend the regular result briefing conducted by the company? The most recent was held last week.
I was referring to FY12 where only net profit (after tax) of $32mil was recorded.
I don't feel "comfortable" revealing more info on how I think. Sorry for that. (I have my reasons)
If u want to find out more, can "PM" me. tks.
btw, if the company comes out now to resume its share buyback program at current price, I will be much more reassured
(unless the company would rather that its share price remain undervalued to the disappointment of minority shareholders)
My worries might be undue as so far, this company has been fine..
(15-08-2014, 09:27 AM)simpleman Wrote: [ -> ]Hi Curiousparty
You said you have some understanding of its businesses but not comprehensive enough.........
You added that some of the "actions" of the company seemed kind of baffling though.... (e.g. front loading of expenditure in one of the FYs so that the profit appeared lower than it should be; venturing into hotel management; have not been doing share buyback despite the share being so "undervalued";etc)
You could perhaps provide details of the front loading of expenditure – when did it take place, the nature of the expenditure and amount?
Since you have so many doubts about Sunsine (to the point of comparing it with China FabriTech) but chose to hold on to the shares, did you attend the regular result briefing conducted by the company? The most recent was held last week.
Curiousparty
This is a forum, and you should share your views and concerns in the open so long as they are backed by facts.
Are you saying that the company “front-loaded” expenditures in 2012 and that resulted in a low profit of RMB 32m?
yes, that is one. And to also "suppress" the share price..
(caveat - this is my speculation)
Many things I "heard" are hearsay and I cannot write in this forum. Hope u understand
(Hence, I don't feel 100% comfortable with this counter though I know it might have good potential)
(16-08-2014, 10:39 AM)simpleman Wrote: [ -> ]Curiousparty
This is a forum, and you should share your views and concerns in the open so long as they are backed by facts.
Are you saying that the company “front-loaded” expenditures in 2012 and that resulted in a low profit of RMB 32m?