₦airaland Forum

my country people, please anyone with any news about globe reinsurance private placement. please help a sis in need. i pray i havent burnt my fingers on that one

Well, Globe Re did a private placement last year which was unsuccessful. Hence they could not meet the recapitalisation requirement. Because of this, they went to enter into a merger agreement with Nigerian Re owned by Jimoh Ibrahim. With the issue with the insurance recapitalisation, Globe Re decided to market the 'closed' private placement all over again. WIth the money they now have, they want to cancel the merger arrangement beause they believe they sell themself short. In the interim, Globe Re MD was appointed NAICOM commissioner which made Jimoh Ibrahim to scream blue murder.

Technically, Globe Re died on Feb 28, 2007. So you may have bought a dead company!!!!!

However, it is possible that they will work out an arrangement with Jimoh Ibrahim.

HayWhzl:
hi guys can some one sheer more light on the IBTC and peterside cashing out, more light please.
@iwerebor
whats up wit ECOBANK, lite it up please.
have been considering TRANSCORP but this issue with the Federal Government is giving me concern. can i still get on the train , thanks in anticipation of a good answer

Nothing is wrong with ECOBANK. They are just over valued. But with ETI providing strong backing, the price is holding steady. Ecobank has one of the highest PE's on the NSE

pumping777:
Will 10 units be sufficient to qualify for substantial rights? I thought allocation will be proportional to holding or is this in anticipation of investors that don't take up their rights?

I don't need to qualify for substantial rights. Once I get the prospectus, I can apply for more than my alloted rights. Don't forget that multitudes will not even apply for the righst because they will not get the propsectus. So I will be alloted the rights of such people.

KDK:
As far as I am concerned, IBTC lack the fundamentals for their current market price. They are over valued and as such I am not surpriced. I project they will stabilize at about N14 by the end of November /early December, 2007.


What made M benefit fall so much? the price has been relatively stable for the past 3 months thoough. Can someone please tell me the prospects of this stock rising in the next 3 months? How is the management and do they have any feasible project?


What's up with NAHCO,What caused the sudden fall in share price as between 15th May and 16 May, 2007? Pardon my asking, like i said earlier, i have been out of touch.

80.89.183.85

NAHCO was marked down for dividend an a 3 for 2 bonus.

IBTC is overvalued. Much more that it appears clear that Peterside has cashed out!!! He basically sold the company to Standard Bank.

pumping777:
Enough distraction by Wema. The journey continues jare,

I'm battling with another result released today,

---
TRANS NATIONWIDE EXPRESS PLC

UNAUDITED Q-1 RESULTS FOR THE PERIOD ENDED SEPTEMBER 30, 2007

PERIOD 2007 2006 ABSOLUTE CHANGE %CHANGE
TURNOVER (N'm) 287.16 209.08 78.08 37.3%
PBT (N'm) 53.73 34.79 18.95 54.5%
TAXATION (N'm) 9.50 6.50 3.00 46.2%
PAT (N'm) 44.23 28.29 15.95 56.4%
* Means Decrease & * Means Increase
Net Profit Margin 15.40% 13.53% 1.9%

Also looked for some history.

*TRANS-NATIONWIDE EXPRESS PLC:

Unaudited results for the third quarter ended 30th September 2006 show Turnover of N209.1 million, as against N119.63 million in the comparable period of 2005. Profit after tax stood at N28.3 million compared with N15.1 million in 2005.*
----

This is a very illiquid stock from my analysis. Does anyone know the outstanding shares in any case?

This company may be able to realize a FY PAT of 180 Million. The stock is trading at 78 Kobo.

I don't even want to print the numbers here,

The figure I have for outstanding shares is 132,546,509. Am I missing something here.

That to me is a stock to buy!!! Being shouting about it since. Placed order with my broker for ages, but no show. Even sent someone on Nairaland to strike a deal with one of the staff who own shares there still no luck! So what can I do?

They are set to do a RIGHTS and after that a PO. When you see things lines up like that, expect a windfall even if it is only for the short/medium term.

If you get to buy, just give me 10 units that will qualify me for the right. Will take it up from there.

Anyone watching the free fall of IBTC

Where do I start from? Let em start from WEMA.

Bought WEMA early this year @ 3.50. Knew the risk I was taking. Sold 15% of the holdings in April and another 30% in July @ average price of 9.00 to buy First Bank. That way, I locked in some profit. Recovered my capital and still position myself for better things.

October, sold some Oceanic @33.00 (need to lock profits. Bought at 6.60 some 15months ago), and bought WEMA @ 8.62 last week Monday. Well, within 4days, made over 20% which was a good exit point for me.

What am I trying to say, once you understand the risk, you can edge against it and still make a profit. It is suicidal not understanding and APPRECIATING the risk involved.

I've always seeing WEMA as a BUY (still do), but I also understand the risk. I knew that the possibility of this kind of report is high. I however also know that the FUTURE is good for WEMA.

For those that bought at a high price (especially with margin facility) get out NOW!!!!! You cannot afford to 'watch' your portfolio drop anyhow. Note however that it will be difficult to get a buyer!!!!! You've not made a 'loss' until you sell anyway!

For those that are in it for the LONG TERM, ride the storm. WEMA will come good. Worst case scenario, get out just before they go on Technical suspension.

With their gross earnings, remove the excess provisions to clean their books and you will be talking of an EPS of about 60k which with a PE of 20 makes 12.00 a fair value.

What most are reacting to now is HISTORY. Focus should be on the FUTURE. If there are no bad loans to write off again, no excess provisions, steady growth in earnigs, EPS of 90k at PE of 20, that means we are looking at a 18.00 stock in the next 12 months or threabout. So if the price falls to 6.00, buy MORE. Not because you wnat to average down, but because you are buying at a discount!!!!!!! While history is important, note that past performance (BAD) is not a guarantee for FUTURE (BAD) peformance.

People should take heart. But I can't help but thank WEMA for helping me thus far

Tmoni:
so do u advise me to just hold on?
getting worried herei am?

Just letting you know the odds against you!!!!!!

That's why risk assessment is very important. When you buy shares in a company like WEMA, you must recognise the downside.

You also need to know that because you don't have insider information you are a bit disadvantaged. Look at it this way, account was signed in July so some are already aware of it. It came out in the papers today which means that it mut have reached the newspaper houses last Friday. Those with such information sold on Friday and today. As from tommorow, there will be a deluge of those that would like to sll. Question is who will BUY?

Well, that is the stock market for you!!!!

Tmoni:
just placed a threshold point of N8,
na wah ooo,
i would definately attempt to buy it at N6,
it would definately take a beating,

Will take a miracle for you to get it to sell. As at 10.00am this morning, over 53m shares were on offer. These increased as time went on!!!!!

All the best.

hbrednic:
bought wema for 10.5,what if i wait for the price to go down to 6 then buy more to leverage out'
please is it wise to do so?

What was your entry and exit strategy when you bought?

Do not have all the details so can only speculate. Until you have the full annual report with the statements from the Chairman and the MD.

At least, I know that the financial statement was not qualified by the auditor.

What you do from here depends on which type of investor you are and your cash situation.

Option one is to sell, cut your losses and say bye bye to WEMA. Why stick to an underperforming stock.

Option 2 is to sell and re-enter later if you believe in the long term viability of WEMA

Option 3 is to do nothing especially if you are in it for a long haul and you are not easily bothered by the daily movements.

Option 2 appears to be the most appealing to me!

Tmoni:
thanks wanajo

that means, it still pays to sell even a N8 because i am with you on the price stabilising in the N6 region

even if i want to re-enter, i would be able to get more shares then

and whats the likely time frame for your hypothesis??

If you can get it to sell tomorrow which I doubt, all well and good. Everyone will basically be thinking of selling tomorrow which will not happen!

What happens from now depend on how the board/decides to manage the situation. The result presented some good news. At least they are not below the N25bn capitalisation. Secondly, they appeared to have FULLY cleaned their books so they can now start on a clean slate. They will come out for an offer but that will be next year. So the rally may not happen until Q1 depending on when they go on technical suspension.

pumping777:
Is 9.2B or 10.2B (or neither) correct for the number of outstanding WEMA shares?

more like >10bn shares

Tmoni:
i am in dilema here, i owm 400,000 units of WEMA bank bought an an average of N9.10,
i am about to give my broker the sell order
i hope i can sell it tomorrow so at least i come out not too scarred considering todays price and the 5% rate

does this sound logical?

hopefully use it for the ETB private placement
on ETB, what do u think the nominal value would be??

A lot depend on your strategy.

Most technical people sold today. With the price movement on Friday, sell order was paramount. For speculators, if you have not jumped ship, it is difficult to do so now.

Bought last batch at 8.62, sold at 10.60 so nothing spoil.

Going forward, WEMA should come out well. The 2006 result was not released because the various expenses (loss)made the shareholders fund to drop below the N25bn expected for consolidation.

Doubt whether the expenses is for goodwill. I think it is for BAD loan provision. This basically implies that they have cleaned their books. The brand is still good. The assets are there so I expect things to look up from here.

I expect the price to take a plunge. This will be followed by the 'insiders' buying at a discount to be followed by a good interim result. Price will raise up and go on technical suspension for an impending offer.

So I am set to buy more if the price goes below N6.00 which is where I expect it to be.

Tmoni:
that means with amixture of carefull and risky investments ,
we shld be able to gain at least 40%,

because i want to do a portfolio management and also take a loan on existing securities to open a trading acct,
interest rates of about 17 -18%,
hv to make at least 36% and above for it to be a fruitfull venture,

PLS, WHO HAS AN IDEA ON A PRIVATE PLACEMENT BY ETB
cheers

Yes it is doable but you need to get your strategy right, have buffer funds since the loan is short term, and be able to take enough risks so as not to diversify. Here, you just need to go for a KILL!!!!!!

shigidi:
wanajo, wema really is running mad, closed on net bid today so might even gian more tomorrow. the funny thing is the net bid is not even maximum which makes me feel some few people know something we don't.

Can't you see the number of deals? Over 600.

Abeg, amke the thing just reach like 12.00 - 15.00 make I celebrate small.

For the risk takers, WEMA is it.

yodiyokun:
Wanaj0,

All insurance companies have been on free fall - just doing yo yo dance.

Anyone that purchased insurance sector should just close the eyes to it till next year.

Meanwhile I have not been following whats up for sometime, I get exam to write in November and money must not burn.

Anything new on the horizon?

Insurance companies are not good at corporate governance. They are just not transparent. All the companies talking about mergers, no merger document at all!!! With the court cases etc, investors are tired of the stocks.

Wema was just too good at 8.60. FCMB is looking good also. Hopefully more company results will come out in November thus dictating the direction of the market. In terms of fundamentals, Flour Mills and WAPCo also are good.

motai:
@wanj0
please i need to know the difference between[b] ESP [/b] and PE and what is their effect on stock values?

EPS is Earnings per share (Profit divided by number of issued shares)

PE is Price Earning Ratio (Market price of the stock divided by the EPS)

WEMA gained another 5% today

IBTC continue the free fall. Law of gravity in operation.

NEM and Dunlop seems to have bottomed out.

I have the brochure. Directors are Prof Osinbajo, Pst Ituah Ighodalo etc.

It is an architectural firm that is planning to go into construction. Basically a one man company in my opinion.

I am not in it anyway.

Tmoni:
wema looks to be going good for us now,
lets see where it heads to

@kilasos, can't seem to find your email addy,
mine shld be there
if not holla me on aberdeen no, and 620977 around 8pm and drop your phone no

Made 15% after charges on Wema within 3days!!! Bought on Monday at 8.60. Now price is 10.29.

Pity those who are yet to sell their IBTC. It has started its free fall now.

pumping777:
You can also look at goodwill as the value of attributes of the company that you cannot quantify. For instance, the brand of the company, the existing customer base and prospects and also the human capital managing the business.

This in a way is what is paid for in a franchise. So for instance if you take an example of a franchise like Mr. Biggs, people know there is already a brand and a customer base exists which will increase the value of the company. Someone buying Mr. Biggs today may be expected to factor this in beyond the value of the assets and liabilities on the books.

You are right.

Pumping777, you quantify that intangible attributes that's why you pay above the fair value of the asset. Like the franchise you talked about, you pay above the value of the asset to cover the good name that you are also acquiring. It is the quantity of INTANGIBLE asset that is classified as goodwill.

KG,

Please let us stick to facts and leave conjecture out.

Fact, IIL bidded for NITEL before Transcorp was formed. IIL won the bid but could not raise the money. If you don't know, First Bank lost N10bn in that deal. These are information available to the public.

Don't know the connection between Globacom and IIL. Check the board of the two of them and you will see the difference. IIL was promoted by Bode Akindele, Globacom by Adenuga.

Orascom bidded for NITEL and came below the reserve bid, was that also the fault of Transcorp? Did they stop Orascom from increasing their bid?

As at the time Transcorp came into the scened, government has concluded for a negotiated sale. Which company submitted a bid more than Transcorp?? I mean it was obvious to most people that Transcorp over paid.

You may fault the process but to put the blame at Transcorp is unfair. I am not a fan of Transcorp but it is always good to deal with FACTS. Maybe gobvernment tilted backwards to accommodate Transcorp. Maybe government was bent on selling NITEL. But I can tell you, government got a good price for NITEL

People only talked about the bids that Transcorp won. No one mentioned the one that they lost. Believe me, they've lost quite a number! Let us be fair!!!!

Ask yourself, how many companies were actually willing to pay top money for NITEL? Same with the refineries, who are those interested? Among those interested, how many are willing to pay the money being asked for by government?

MyPeace:
Wanajo and others,

Please can you advise me on this ARM new Fund sold at N20 per unit now. l seem to be interested, is there any contrary view? And how much can one possible make per year? The minimum investment is N50,000.00. thx

ARM fund (discovery fund) is one of the least performing. Reason is because they are heavily invested into real estate that takes time to bring returns. Check their investment structure and see whether it aligns with your plans.

Personally, I am not investing in any fund. I can invest individually and do better than them

netotse:
ummmm can someone please expantiate in this goodwill thing a bit(actually a lot)more have absolutely no idea wot it means,

Goodwill is the difference between what you paid and the fair value of an asset. So when a company acquire another company, they normally pay more than the 'value' of the company. That difference is what is carried and termed goodwill. It is basically an intangible asset. For example, if the value of an asset is N5 but you paid N9 for it. In the books, that asset will be N5 and the balance N4 will be the goodwill. That N4 is an 'intangibble' asset because in reality it does not exist. But you do not want top write off everything in a single year from your profit so you amortised. However, CBN has allowed the banks to use their reserves (share premium) to net off the goodwill.

Frankiriri, one major effect of the writting off the goodwill in a single go is that it reduces the shareholders fund!!!!! That is the key risk for the banks. For some of them, going that route invariably implies that the shareholders fund will fall below the N25bn mark. That is one problem that WEMA is having now!

Secondly, writing it off from reserves means you are 'overstating' profit. If you've done it over 5 years, you would have used the profit made every year to amortise. Now, you are amortising from reserves.

So for me, the major risk is the reduction in shareholders fund! That's what the banks use to brag as per their size!

Almost all the banks that merged went this route. IBTC, Diamond, Access etc.

Note that the rule applies to banks alone. OandO has goodwill on its books and it is allowed to pay dividend. It is BOFIA that does not allow banks to pay dividends while carrying goodwill.

RoughCut:
I have WEMA which i have been holding onto now so the question for me is to sort out how many more units i need to acquire_{i'm talking extra large here}. I feel like i'm taking the biggest gamble since 2004 so i'm a bit jittery just now

Bought WEMA at the beginning of the year at about 3.50. Sold 30% sometimes in July for 9.80. That enabled me to lock in profit and take opportunities somewhere else. Now bought some more at 8.60 yesterday (half of what I sold before). So, my loss will be minimal if any.

So it has to do with the prices at which you bought, your exposure and how you are hedging your risk.

Risk management is key to investing. For me, preservation of capital is the first objective.

lawalidowu:
@wanaj0 and easimoni
Broses! I have 1mil that i am willing to tie down for 6 - 12 months. i hope to have started reaping something at the end of d 6 month period possibly selling some. i am talking really short term here. what do u think?

I am thinking Transcorp because the price has gone less than half its peak and it i believe it is boumd to go up irrespective of what trouble they might be in. you can't chuck NITEL in the Bin can u?
also japuoil, fidelity and not so sure of what insurance companies.
kindly let me know what you think plus projected prices in a 6 month period.

do u have any penny-stocks in mind.
MORE BLESSING

Doing short term is a plan for high blood pressure. Doing short term with TRANSCORP is a recipe for disaster. Please DON'T!!!!!!!!!

Never do short term with an IPO. At least not less than 6 months!!!!!!!

Like you must have noticed, a lot depend on your risk appetite. I prefer people going to the market with a long term objective even though you can take advantage of short term opportunities.

Diamond and Wema are good if they FIT into your risk profile. Note na your money and the RISK is purely on YOU.

shigidi:
WEMA has gained 5% for two consecutive days now!!! i smell a rat somewhere, i might just hold on till the end of next week and see what happens.and flour mills seems to be bleeding, a good entry price for anyone.

Bought WEMA yesterday at 8.60. Will watch and see if it will get to 15.00 so as to exit.

shigidi:
wanajo, on BETA GLASS when does this ban on glass bottles by NAFDAC take effect. and if this is true, don't you think attracting a pe of 20 will be optimistic as people will tread cautiously knowing future profits wil be affected.

I was talking of a price of 20.00 and not PE.

NAFDAC ban was for 2008/2009 but nothing to show that this will be done. Although, they may make a shift towards making bottles for the pharmaceutical companies to improve the situation if NAFDAC goes ahead with ban.

RoughCut:
All the sectors worth looking at are volatile! and should i add the higher the volatitly the higher the risk and potential to realise fantastic returns and also the potential to incur catastrophic losses. The financials that invested in the so-called mortgage backed securities will know more about what i'm saying. Case in point Northern Rock

So there are really no safe bets when it comes down to it!

Nigerian environment is different. Different in the sense that the risk matrix differs. You need to know the risk drivers so that you can hedge your risk when you invest. You need to know the business model of Costain and how it fits into the economy at large. Are they set to profit from the economic climate? That information is not totally available in the public domain.

No problem in taking risks. But take risks that you UNDERSTAND!!!!!!!!! Take calculated risk.

STREET TRADING. Just check Gala. Only sold on the streets

RoughCut:
Yaa i go try hold liver for WEMA

Does that mean more share dilution for Zenith? I have already missed once on cashing out on Zenith when it was N68 so i will be watching Zenith like a hawk now

What's your take on Costain? A technical analyst i was reading sometime ago reckons the resistance level for Costain is N13 and according to him that's a good entry price with the aim of exiting when it gets to N23 sounds reasonable to me but not sure about the price going back down to N13

The Zenith bank story is still a rumour so take it with a pinch of salt!

As per WEMA, hopefully by December the waiting will be over.

On Costain, I am not that convinced about them. Cappa and D'Alberto looks better to me then. Not sure of now. It is a sector that is very volatile!!!!