Shares of Swissco go tumbling from 0.39 to 0.32 today, after I reported
that it could be the next Ezion.

What happen?



In earlier blog it was already mentioned that Swissco will enter into Rig business. 

“End Feb Swissco announced that it will acquire
Scott and English for S$285M from Double Dragon Energy. This is effectively an
RTO from Tan Kim Seng to inject the Rig business into Swissco. With the
acquisition, Swissco will undertake a share consolidation of 2-1. The
consideration of 285M is satisfied by allotment and issuance of 452M shares or
S$0.63.”


This mean that 0.63 / 2 = S$0.315 at
pre-consolidation. 

Hence 31.5c is the fair value pricing, which
sent 39c tumbling down within a day. 

PE is 6.4x at 32c. BVPS = 31c, PB at 1.05x.
 ROE at 16% and ROA at 8%. 

Competitors like Pac Radiance  and Jaya
are all value at 10 and Marco Polo PE at 8. Ezion is at PE 15. Malaysian
competitors such has average weighted PE > 30.

Price is at 35% discount to industry, with a good
growth story coupled with its extensive networks mentioned in earlier blog,
seems like it is time for Long position!!!



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