Wednesday, April 23, 2014

Why selling Talam is a good thing for Keuro

As mentioned before, Keuro has 3 main assets - the West Coast Expressway, Rimbayu project in Selangor and a 30% shareholding in Talam. I would rate the value of the assets in a descending order i.e. WCE would worth a lot assuming the highway is widely used after the completion as it is the other alternative to PLUS between Klang Valley to Taiping. Rimbayu would be a very large project with now Keuro holding an associate stake with IJM developing it, while Talam is just an investment, although it may be worth more than what it is today (in my mind) as some of the assets are at book value which was not revalued for a long time.

Given the analogy of a sports team, if you are a team with some very good players, and some fringe, supporting players and the team will need to sell to grow, what do you think is the best way to go about it. Selling the supporting players, of course as the team would still need to grow around their very best players - and that is the case with Keuro.

It needs the money to grow. Talam will be worth some good money. The issue is how much would Keuro be selling them for assuming it is doing the right thing for its shareholders?

Tuesday, April 8, 2014

Talam and KEURO

Recently, we are seeing some interests in Talam Transform as it continues to reduce its debt by selling assets. In the process of selling its assets, it is realised that many of its assets are undervalued in its books. At as now the NA per share is about RM0.14 to RM0.15 per share (that is book value) and may not be real value.

I am sure after its cleaning of its books, we will be seeing some real projects, but probably not using the Talam brand.

Why am I interested in Talam? Keuro holds 30% (controlling) of the company.

Saturday, April 5, 2014

SP Setia and TRC

Sometimes a slight change in management would make you think. The first thing that you would want to follow through is what would the changes be. In a recent announcement, SP has just awarded contracts to TRC Synergy for its project next to Mid Valley, named KL Eco City.

To me and many, SP Setia is the most prominent Malaysian developer and sometimes, you do not want to associate with not so good names. If you noticed two mishaps last year, TRC was in both.

Is there anything within SP Setia that we do not know of?

Saturday, March 29, 2014

Telekom-Green Packet: The weird world of Malaysian telcos

Remember years ago when Telekom Malaysia (TM) had TM Touch? They were going nowhere and for TM to have a significant mobile business and successful one, the forced (sort of) purchase was planned. After the purchase of Celcom from Tajuddin Ramli, years later it was split again, presumably for Celcom and its mobile business to have a solid Asian strategy, hence Axiata.

TM on the other hand, was given a lot of handouts in the form of financial assistance for its fiber broadband rollout - to the tune of multi billions. With that handout, few would think that TM can fail. In fact when Celcom and other mobile businesses were split from TM, these mobile group was structured to owe TM something like RM4 billion, another assistance to TM.

TM should not and cannot fail, just like MAS. The difference between MAS and TM is that MAS is fighting globally competitive players. TM is given a headstart in any of the competition it goes into, something like standing on the 50 meters mark in a 100m race while the rest will have to start from the beginning.

Who will think TM will succeed in the mobile data business acquiring Green Packet? I don't.

In a standing start against players like Maxis, Celcom, Digi - it will pretty much lose, what more coming from behind although it has the backbone of fiber optics - something that the others lose out to TM.

In a business of telco, it is not just the infra. Tell that to Digi, which does lose out in infra - even for the LTE spectrum and it did not even have the 3G spectrum earlier - forced to a deal with Time Dotcom.

This deal does not help anybody but to postpone the demise of Green Packet while another player whom are not able turnaround anybody is thinking that it can. SK Telekom's name is just a convenient partner to bring the story line sounds better. After all, it has been with Green Packet for many years and nothing really happened.