Wednesday, November 21, 2018

Bought Gamuda and Sold MRCB

I decided to buy Gamuda as I thought that the selling was overdone. I was not around during that time, this trade was made in 8 November 2018.

Generally, I thought that the MRCB announcement of compensated for its highway was already accepted by the investing public. Despite selling, I still think that MRCB is still undervalued but I feel that Gamuda is a better bet in the long run.

I think despite both are not apple to apple, but Gamuda is a better company in terms of capabilities and capacities. Although it has lost several contracts like the MRT3 and HSR due to postponement, Gamuda is still a more solid company in the long run.


reyes430 said...

how do you see the compensation on EDL highway? Is it fair to pay at the cost?

felicity said...

EDL was a problematic toll road where it was at the verge of being cancelled by state or federal government. Hence govt bailing out is good for MRCB.

GL said...

Hi Felicity .. agree that Gamuda is a solid company which could do better in the longer term .. what is your thought about Ekovest vs Gamuda on its future prospects in the long run... ? Thanks.

felicity said...

Unless Gamuda is too strongly aligned with the old government, we cannot ignore this company. I just went through the Annual report of Gamuda. It is a visionary company in its space. I believe as it goes with the situation and times, it is a company that will adjust. In fact, the theme of the company for this year's AR is Upskilling, Towards a Sustainable Future. It shows that they have a vision and is forwarding their messages to the masses.

gamuda is the type of company, Malaysia should cherish and promote. It is not looking at just purely making money but the way I see it, it is looking towards the future - both in terms of company sustainability and business. How it is to handle the digital revolution.

Ekovest on other hand, does not do that well. It is still a family based business. the largest shareholder still treats it like his business. Having said that, Ekovest is trading at a very low price in comparison to its assets.

Ekovest has good concession and its share price is cheap. So in short Ekovest is a good company at cheap price. On the other hand, I should say Gamuda is an excellent company at a slightly below fair price.

GL said...

Well said ... thanks Felicity