Hai Leck

[dydx]

The thing to note is that the conversion price is set at $0.26. If all the warrants are converted into shares, the net cash less all liabilities will be about $0.17 per share.

An investor paying for a share price of $0.28 is getting a "PE less cash" (if we striped away the cash - I learned this from you) of only 3.8, i.e. paying $0.11 per share for an EPS of $0.0296.

You are quite right on the cash numbers, provided of course the company does not spend the existing cash reserve and the additional cash coming in from the warrants, on some fixed assets or new investments which do not contribute to earnings any sooner. If and when this happens, you will have to drastically adjust your assumptions on cash per share and "Adjusted PER, nett of cash".

Hai Leck just got listed no too longer ago, and does not yet have a proven generous dividend payment track record. Besides, management will likely spend at least a portion of the existing cash reserve and of the additional cash coming in from the warrants, on expansion projects. So is it wise for us to attach full value on the cash in the company? Probably not.

The coming conversion of the 130.0m warrants - and the resulting dilution impact on EPS and earnings for existing shareholders - does add a dynamic factor and a degree of uncertainty to investing into Hai Leck or holding on to the counter in the next 12 months.