$Indofood Agri(5JS.SI) Privatisation way undervalue.. please ask all the holders not to accept the offer. Salim group will possibly be revising its offer , 0.28 is a test, do not believe any analyst who anyhow recommend.. I will show you prove that Indoagri is a much better managed company compared that to even Wilmar. Please see my attachment, we just need to see trend, do not bother about profitability, asset price or dividends for the time being.. because all those are easily manipulated..
Also, please bear this in mind.. please always seperate a company operation from its share price.. they do not go in line most of the time. Indoagri share price keep falling has nothing to do with it fundamental.. it is artificially kept low for this privatisation to happen.. you realised on last quarter Indoagri posted the first ever net loss ... then an offer privatisation came after that.. think why the group did that..
Here are the comparison:
Wilmar palm oil land bank ~230,000 hectares - mainly in indonesia
Indoagri land bank ~ 300,000 hectares - mainly in indonesia..
Think from this angle.. Indoagri is under reporting its assets value..
Now on financials, I oniy need to see 3 lines, pls refer to attachment, observe the trend from 2008 to 2018..
3. Market cap
In the attachments, you will see Indoagri is a better manage company, more prudent and less agressive. Here is why:
From 2008 to 2018 (SGD)
Wilmar cash 2008 is 4.2Bil, in 2018, cash is 5Bil.
What is the increase? It is 1Bil increase.
Wilmar debt 2008 is 7.5Bi, in 2018, debt is 31Bil (Yes! It is true) so, what is the increase in debt? 24Bil! This is a 300% increase in debts level.. ofcause I do not want to go into profitability like I said..
Wilmar Market Cap is 17.8Bil back in 2008, today market cap is around 22Bil. This is very clear that Wilmar uses its growth in Revenue and profitability numbers to support its market cap. This is what market accepted..
So. Lets go back to Indoagri
From 2008 to 2018 (SGD)
Indoagri cash started off with 300Mil in 2008, by end of 2018, its cash is 210Mil. A tiny drop of 100Mil.
Indoagri debt in 2008 was 800Mil, 2009 was 1Bil, all the way to 2018, it was still 1Bil. There is no fundamental deterioration in its debt level.. company did not borrow excessively to expand its operation to provide better results yoy.. Indoagri main objective is to supply palm oil as raw materials for other sister companies business.. the company is so important in Indonesia economy.
So what we see as unfair is the drop in Market Cap in indoagri..
Indoagri started off at market cap 790Mil in 2008, and rose to 3.3bil in 2009, 0.50 per shares to 3.00 per share.
Today, we saw indoagri keep shrinking all the way to 390Mil, an offer price by Salim group.
Ask ourself, is there any fundamental change in the campany? The answer is no....there is no reason to sell the company cheap because commodity prices are seasonal..
Price will go cheap, price will go expensive.. company remain healthy.
I wont be surprise Indoagri will be delisted from sg and relist in Hong Kong with multifold PE later.. that time, you will see Indoagri report very very high profitability.. this I can assure you..
We must all think like a business man... we minority should not be taken for a ride.. pls pls