Amin is no ordinary "David"

Amin is no ordinary "David"

Tenaga Nasional Berhad's bid for taking private Integrax Berhad at the moment is most probably a foregone conclusion that it will not be a successful one. While the major minorities group notable Perak Corp Bhd (44,945.217 shares) and TSM Global Berhad (12,000,000 shares) and to the extend, Public Smallcap Fund (11,854,200 shares) has largely remained silent about this, one man has been waging a one-man war against the bid.

That one man is Encik Amin Halim Rasip, the co-founder of Integrax Berhad. Amin has been very vocal about this ridiculously low price offer from Tenaga and would not sell unless the offer is something like RM5 which is nearly 81% more than the current offer price of RM2.75.

Amin strongly believed that Integrax's future potential earnings as "the benchmark" for what he believed to be RM5 per share and Tenaga's offer was not reflecting that future value of Integrax at all. And it is not difficult not to understand the reasons.

Although Integrax's average earnings per share (eps) for the last five years is only around 13 sen plus minus, the same eps cannot be said for the coming years when more coals are shipped to its port by Tenaga.

Tenaga's coal-fired power plant in Manjung, Perak is located at Pulau Lekir in Perak. It currently comprises 3 units known as Manjung 1, Manjung 2 and Manjung 3 with a total generation capacity of 2,100MW. With the commissioning of 2 additional units known as Manjung 4 and Manjung 5 in 2015 and 2017 respectively, it will have a combined generation capacity of 4,100MW.

As such,  we all know that more coals will be needed and shipped from Indonesia. There would be more business going on at the port. More business would mean more revenue for Integrax which ultimately translates into more profit.

Imagine in the coming years the eps of Integrax shoots to above 20 sen or even higher, do you think the price of Integrax share would still be around RM2.75 then?

So we have two sides to the coin. On one side, Tenaga and its "team of advisers" are saying it is a fair and reasonable deal for the minorities in view of Integrax's past share price which has not traded above RM2.75 prior to the offer from Tenaga. Tenaga even has the cheek to say it is a good premium over its pre-closing price of RM2.31!

Tenaga also sounded rather a bit "threatening" of its serious needs to obtain control over Integrax to ensure the security of coal supply to TNB's Manjung Power Plant. Tenaga mentioned that by 2017, the Manjung plants would be supplying around 18% of the national electrical supply.

Thus it is most important to obtain control of Integrax or better still, to fully own it.

But on the other side, there are other minorities who had faithfully invested in Integrax's business long before Tenaga became shareholders.

These minorities silently stayed with the company all these years with the hope that one day, the potential earning of Integrax would increase and thus the reward would be reflected in its share price.

And now the future looks very bright for Integrax in view of Tenaga's commissioning of 2 additional units known as Manjung 4 and Manjung 5 in 2015 and 2017 respectively.

While we minorities only see from the outside, our "David" Encik Amin, sees it very differently from the inside. He sees the future potential of Integrax more than that. He is so adamant about not selling to Tenaga for that low price offer that not only did he share his views about this openly, he also takes action by buying Integrax's shares from the open market for several days, thus increasing his percentage holdings. Amin has been buying in the open market from Jan 22 to Feb 12, 2015.

In fact, based on today's market closing, Amin now holds 69,080.835 shares of Integrax. Based on this, Amin must now rank as the number one shareholder of Integrax, more than Tenaga's 66,538.269 shares.

If Tenaga is serious to fully own Integrax, Tenaga must revised its offer price to a significant higher amount which must be appealing to many minorities. At the moment, the RM2.75 is just simply a cheap bait!

Several of my followers and friends who bought Integrax shares after reading my blog early last January are with you, Encik Amin.

I urge other those minorities who also own Integrax shares to support Encik Amin by not selling to Tenaga at this price.

Together, we have a better chance of forcing Tenaga to revised its price.

At the time of posting, Integrax announced its 4th Qtr 2014 results. It earned a 4.08 eps and subsequently announced an increase of dividend by 50%. It announced a dividend of 7.5 sen with the ex-date on Mar 3, 2014.

LATEST REPORT that according to a close source, Tenaga has adopted a "take it or leave it" stance on this offer. As the report is not an official one from Tenaga, I shall not comment anything on it.

Bumper Chinese New Year "Ang Pow" for LPI shareholders

LPI Capital Berhad announced a record earning of 55 sen for its 4th Qtr 2014 on Jan 28, 2015. Total earning for year 2014 is an impressive earning of 130.33 sen.

Dividends declared for this second interim is 55 sen, together with the first interim of 20 sen (paid on Aug 21, 2014) brings together total dividend of 75 sen, much higher than the 70 sen and 65 sen dividend paid for Financial Year 2012 and 2013 respectively.

Interestingly, the company also announced a bonus issue of 1 for 2. LPI’s FY15 share base could enlarge to 331m shares (from 221m shares).

The good result, higher dividend declared and the bonus issue rocketed the share price to an all time high of RM21.28 the next day although it finally settled down at RM20.66. That day alone, the share price rose RM2.16 or an impressive 11.6%! Naturally, it was the day's number one top gainer.

According to a report, LPI's impressive higher-than-anticipated earnings were lifted by gains on the sale of Public BANK shares.

I shared with readers as early as last year in my blog : One Seng Up, Another Seng Down on Jan 3, 2014 about my purchase of 500 shares in LPI (at RM13.90 on July 18, 2012).

LPI has continued to turn out to be a pretty star performer in my investment portfolio of shares. Total dividends received so far is RM775 and the current share price of RM20.80 minus my original price of RM13.90 means a paper profit of RM6.90 divided by 500 shares is RM3.45. The total profit is RM4,225.00 (including RM775 dividend)!

As Chinese New Year is just a few more days ahead, I like to take this opportunity to wish all my Chinese friends a very Healthy and Prosperous Goat Year!

Certainly shareholders of Integrax and LPI must be loving the goat more than anyone else this year. You know why!