49 replies to this topic

[yusufm]

closed 285c. Looking to re-enter on a pullback

back in at 281

[yusufm]

Current share price > NPL price. Time to buy NPL's, shifting order to 265c

closed 285c. Looking to re-enter on a pullback

[buylow]

Hi guys,

 

Will Jasco's trend continue?  Up 26% for the year already and it looks like the next target may be around 1.50? Maybe higher??

 

In February this year, Moneyweb reported that they are at the end of 3 year restructure period and that "the full benefits of the three-year restructure will come through in financial year 2015."

 

I think the benefits are already in the making.

 

"After two and a half years of intense restructuring, there are only six more months left for cleaning up the mess. “And then this business has to run” says da Silva. “I would like to see every unit in the group delivering double digit PBIT margins by the end of this financial year.”

Posting revenues of R530 million for the six months to Dec 2013, da Silva notes that 80% of this turnover is already above this margin target. “My ideal business level for Jasco after all the restructuring is a full year turnover of R1.5 billion, returning PBIT margins of 10% plus. At this point the operations will start to tick over nicely. 

There are a couple of focus areas and things to tick off the watch-list. An immediate priority is the Security business segment which had a disappointing six months due to lack of projects. Another point is the disposal of a 51% holding in M-Tec, not a good investment for Jasco from the start. This offload is taking longer than expected as some uncontrollable delays came from Korean shareholding changes.  And group procurement needs to be improved and consolidated - “This is not as easy as we thought” says da Silva.

Jasco comments that as a group, its business is not seasonal and there is no marked difference between H1 and H2. “Businesses which feed into consumers may see a lift during the Christmas season, and those which service various government departments may be busier at the end of the fiscal year.”

Da Silva concludes that the business base is now positioned for growth, financial position has improved, and the full benefits of the three-year restructure will come through in financial year 2015."

 

 

 

 

[yusufm]

Current share price > NPL price. Time to buy NPL's, shifting order to 265c

[yusufm]

Unbelievable. Caramba, how could that happen

People make mistakes with NPL's. Could've thought that it was the actual product trading at a significant discount.

Or more likely, in my opinion, it was someone driving up the price on low volumes and then selling large volumes on the way down.

 

SHF holders should also note that the value of the NPL's is the market price of SHF - R52. So currently it is worth 5424- 5200 = 224c. Current npl price is 276c. Unless you guys think that SHF is going to rise by 50c in the next week, it would be a good idea to sell out now.

 

I will be buying the NPL's at 220c currently....

Edited by yusufm1, 14 July 2014 - 01:37 PM.

[Moonraker]

SHF listed its NPL's today. It was possible to buy at under 300c at around 9 o'clock and then sell at R40 just before 10 o'clock....

Unbelievable. Caramba, how could that happen

Attached Files

•  SHF npl.png   17.56KB   33 downloads

[yusufm]

SHF listed its NPL's today. It was possible to buy at under 300c at around 9 o'clock and then sell at R40 just before 10 o'clock....

 

[vlam]

NPLs are usually traded for only a 2 week period or so. If the NPLs are not taken up, they are worth nothing at the end of the period. They also typically do not have a large daily volume (unless its a more well-known underlying share like Curro). As such, to enter and exit without exercising the rights is difficult in large amounts (for example with the JDGN ones, it'll be difficult to trade more than 10000 shares). 

<snip>

 

Thanks yusufm1 - much appreciated!

 

I'm definitely going to be looking into this more - thanks

[yusufm]

Entering at 50c if i can... target 90c

still hasn't matched, will not buy if JDG closes below 25.50

[yusufm]

What type of yield can one expect from doing that?  Just curious - currently I'm only investing in shares, but I've been meaning to look into NPLs more.  Currently my only exposure to NPLs have been surrounding right issues for shares I already own - in other words not as an investment into something new.

 

Any insight appreciated, thanks

NPLs are usually traded for only a 2 week period or so. If the NPLs are not taken up, they are worth nothing at the end of the period. They also typically do not have a large daily volume (unless its a more well-known underlying share like Curro). As such, to enter and exit without exercising the rights is difficult in large amounts (for example with the JDGN ones, it'll be difficult to trade more than 10000 shares). 

 

However, if timed correctly, large return on the capital can be expected. Here is an example:

 

ABC shares are trading at R11 a share, they issue NPLs at a subscription price of R10. Therefore, the rights are technically worth 100c each (1100-1000). 

If the share price of ABC had to go up to R11.50, which is only a 5% move, the ABCN shares would now be worth 150c, a 50% move. 

 

Like I said, you can make a quick buck trading the underlying share against the NPL but the risk is that you might not sell it in time (because of the liquidity) and that the share price of ABC shares may drop below R10 in which case the ABCN shares are worthless (investors would rather buy the underlying share at a discount to the subscription price).

 

My advice if you do want to try trading them, is to limit your position so that you are able to get out before the deadline date and watch the underlying share closely. 

[vlam]

very true, I've been trading NPLs for years now, but I have noticed that most do correct themselves to what the underlying share is trading at. Haven't taken a position yet on this one though

2k pays for varsity spending money for a few months shi

 

What type of yield can one expect from doing that?  Just curious - currently I'm only investing in shares, but I've been meaning to look into NPLs more.  Currently my only exposure to NPLs have been surrounding right issues for shares I already own - in other words not as an investment into something new.

 

Any insight appreciated, thanks

[yusufm]

very true, I've been trading NPLs for years now, but I have noticed that most do correct themselves to what the underlying share is trading at. Haven't taken a position yet on this one though

2k pays for varsity spending money for a few months shi

 

Entering at 50c if i can... target 90c

[Shi]

Cool man, sounds like you know what you doing

[yusufm]

YusufM1, the problem with a trade like that is volume. It's alotta risk but for what, 2K in profits or so??

very true, I've been trading NPLs for years now, but I have noticed that most do correct themselves to what the underlying share is trading at. Haven't taken a position yet on this one though

2k pays for varsity spending money for a few months shi

[Shi]

YusufM1, the problem with a trade like that is volume. It's alotta risk but for what, 2K in profits or so??

[Magnet]

4,995,000 sale just went through for FGL ??

Sent from my GT-I9500 using Sharenet Sharechat mobile app

[Mr.Balls]

Guys, two weeks later... Any calls on TTO and Finbond?
Finbond been stagnant for about six months
Could rates increase in Jan kept them quiet?

Every time I walk past the Finbond here in our town there is nobody in it...

[yusufm]

Is there anyone else who trades NPL's for a quick buck? 

JDGN is trading at about 50c below where is should be (2600-2500=100). Thinking about risking a quick trade....

[Sugafoot]

Guys, two weeks later... Any calls on TTO and Finbond?
Finbond been stagnant for about six months
Could rates increase in Jan kept them quiet?

[alsi_speculator]

SLM is going to drop big time real soon. Looks like a good short opportunity.