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Hi Tony

Would like to ask why you think this counter is cheap? If I'm not mistaken its above NAV still. Are you looking at some other metric?

(02-07-2013, 08:28 AM)tonylim Wrote: [ -> ]Any opinion on this counter at this price level ? Valuation looks cheap .

Technically, it will be cheaper to buy Wilmar when it dips to the $2.9-3 range in the lower band of the linear regression band.

(03-07-2013, 02:25 PM)LikeWise Wrote: [ -> ]Hi Tony

Would like to ask why you think this counter is cheap? If I'm not mistaken its above NAV still. Are you looking at some other metric?

(02-07-2013, 08:28 AM)tonylim Wrote: [ -> ]Any opinion on this counter at this price level ? Valuation looks cheap .

Hi Likewise,

PE12-13X , NTA of S$2.80 , believe the valuation is relatively cheap, even during the GFC, the PE was around 9.7X.
Some like to compare Noble or Olam to Wilmar , but are they really in the same league as Wilmar ?
I live in China for more than 15 years and understand the brand names of Wilmars' products , they are so well accepted by the local consumers, their cooking oil is just one of them.
Their distribution networks , especially in China is a solid platform for new products to ride on , that's a reason why Goodman Fielder of Australia wanted to be associated with Wilmar. Not many competitors can emulate Wilmar in China, except some local glcs.
They are in food business and it is normal for food industries to have such net margin.
Above are just my personal opinion, hope you can share yours also, thanks.

Hi Tony

Thanks for your elaboration. For me, my few cents worth are below:

Worries:
business is similar to Berkshire's textile biz in that its hard to increase price without people objecting or switching to other similar products. Also gov has a say in controlling prices.

Net profit margins are fairly thin. IIRC. So not sure how they will
improve margins in core biz.

Involved in a lot of commodity processes that are hard to predict. Fr
ex the haze might affect Wilmar, bird flu scare, etc

High debt.

The above 3 points Leads me to worry about a black swan. Not sure how
they would mitigate such an event.

Low dividend.

Pros:

Diversifying itself.

CEO once mentioned that a lot of the success if Wilmar is down to chance. IIRC. I prefer a leader that admits chance plays a big role in biz rather than someone who is convinced of his predictive capability.

Prefer Wilmar over other commodity counters.

I'm vested btw. Haha... Probably shld have more reasons here than above.

(03-07-2013, 02:41 PM)Tiggerbee Wrote: [ -> ]Technically, it will be cheaper to buy Wilmar when it dips to the $2.9-3 range in the lower band of the linear regression band.

Technically it will be cheaper to buy Wilmar when it dips to the $2.2-$2.3 range near it's all time lows.

Value bro value...

Just sharing ...

IMO, it is relative 'cheap' @ PER 10.
Of course PER 10 will be better but will it come?

Hi Likewise,
Fully agree with your points.
However it is a norm that commodity biz is high vol and thin margin.
In fact many other bizs are having such norm also, except some tech or property companies.
The strength of Wilmar is their setup is highly vertical , from planting to distributions, this is not easy for others, especially the new players to copy. Many edible oil or food related companies without this vertical setup, have to depend on raw materials from third parties, will have an uphill task to compete in this competitive World.
ZARA used to be a small garment manufacturer in Spain , they wouldn't be profitable if they didn't go into vertical setup, now ZARA has yarn spinning to apparel retailing.
If Wilmar no longer owns palm oil or sugar plantations, I will cease to be a shareholder.
This is my first quest with Wilmar and hope this entry price justify my decision.
Cheers.

Wilmar's consumer product should have better margin, as its brand is quite strong in China.

just have to wait for its most small competitors to die first. then the giant remained ones will raise price slowly.

(05-07-2013, 10:53 AM)freedom Wrote: [ -> ]Wilmar's consumer product should have better margin, as its brand is quite strong in China.

just have to wait for its most small competitors to die first. then the giant remained ones will raise price slowly.

Haha... True, i think the last part is true for just about any commodities related stock at the momment. It might be a long wait though. In studying the commodities markets i'm actually looking back more than 100 years, to the American gilded age, to look for ways for oversupply to correct itself.

I think it is better to have some indicators prepared for a fundamental market improvement towards suppliers, and waiting for a change before investing in commodity stocks at the moment.

(05-07-2013, 10:53 AM)freedom Wrote: [ -> ]Wilmar's consumer product should have better margin, as its brand is quite strong in China.

just have to wait for its most small competitors to die first. then the giant remained ones will raise price slowly.

I am wondering, will there be price cap restrictions set by the government since these products are daily essentials?