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Sri Lanka Equity Forum » Stock Market Talk » Experts pls advise on BLUE

Experts pls advise on BLUE

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1Experts pls advise on BLUE Empty Experts pls advise on BLUE on Sat Feb 04, 2012 10:55 am

sanjaya351


Manager - Equity Analytics
Manager - Equity Analytics
Experts pls advise on BLUE ..
Including me some ppl think its a share with a good future with SLIC & BAT involved and some Singapore party also shown interest ..
Whats this capitol reduction ? Why this sub division after that ? NAV will go down further after capitol reduction or will it increases ?

Pls share your sincere views ?

2Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Sat Feb 04, 2012 1:45 pm

sriranga

sriranga
Co-Admin
There are some threads in this forum discussed the matters what you are concerning.
Please check following link
http://forum.srilankaequity.com/search?mode=searchbox&search_keywords=BLUE&show_results=topics

Even some of the threads were originated by you and commented by our senior members.

http://sharemarket-srilanka.blogspot.co.uk/

3Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Sun Feb 05, 2012 9:16 am

arjunaedirisinghe


Equity Analytic
Equity Analytic
dont touch it there will be a capital reduction and split of shares. Split is not attractive under present market conditions and number of shares in issue. I recommend you to watch a bluefilm instead of putting money in BLUE.N000 now

4Experts pls advise on BLUE Empty Isnt it like REEF -Those days on Sun Feb 05, 2012 11:47 am

sanjaya351


Manager - Equity Analytics
Manager - Equity Analytics
See when Reef hotels were trading at RS2 - who thought it will reach present high ...?
I feel some thing similer will happen to BLUE after split /subdivision it might trade initialy at 0.80 -0.90 range and may go towards 1.50 -1.90 like SEMB - People go behind penny stocks ?

Isnt it ?
most of us don't see fundamentals when trading ..

5Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Sun Feb 05, 2012 12:36 pm

walapingana

walapingana
Equity Analytic
Equity Analytic
True Sanjaya but after split. not to tough now. We do not not the repurchase price in the reduction capital and what kind of adjustment will be done by the Auditors to the net assets in determining the fair price. Dont conclude as above Sanjaya. Better thing is not to tough now you may interested in buying after split

6Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Sun Feb 05, 2012 12:43 pm

sanjaya351


Manager - Equity Analytics
Manager - Equity Analytics
@walapingana wrote:True Sanjaya but after split. not to tough now. We do not not the repurchase price in the reduction capital and what kind of adjustment will be done by the Auditors to the net assets in determining the fair price. Dont conclude as above Sanjaya. Better thing is not to tough now you may interested in buying after split

thank you ...

high risk ..high loss ..& ..high profits ...isn't it ..
whats this invovement of singapore & BAT & SLIC ..pls let me know if you hv any information ...

7Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Sun Feb 05, 2012 1:56 pm

troy

troy
Moderator
Moderator
high risk ..high loss ..& ..high profits ...isn't it ..
whats this invovement of singapore & BAT & SLIC ..pls let me know if you hv any information ... [/quote]

SLIC & BAT have 10% & 9% stake respectively in BLUE.Same two institutions have 24% & 4% stake respectively in ECL also. ( as per last quarter financial statements and in my thinking they may still have that much of a stake.)

Involvement of Singapore to my knowledge is in CSE annoncements. A subsidiary of ECL & BLUE is going to form a new Subsidiary in Singapore.

SLIC/BAT/ECL are linked with BLUE....

8Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Sun Feb 05, 2012 2:02 pm

greedy007


Senior Manager - Equity Analytics
Senior Manager - Equity Analytics
sanjaya351............ you are asking advice?
Oh no.

9Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Sun Feb 05, 2012 8:58 pm

Rajaraam


Vice President - Equity Analytics
Vice President - Equity Analytics
sanjaya351,

Capital reduction is a good tool to write off accumulated losses and other debit balances in the Balance sheet of a company. When a company decided to write off its accumulated losses from the books that amount has to be charged against the Share capital Account to fullfill the double entry requirements. That is why we call it capital reduction. In fact realy what they want to do is write off the accumulated losses from the books. Once they do that their Balance Sheet is clear and attractive. This would ease the company to borrow funds for expansion, working capital requirement etc.

If we look at the BLUE Balance Sheet (as at 30.09.2011)we can see following figures;

1.Share capital =Rs. 1,064,854
2.General reserve =Rs, 135,000
3.Accumulated Losses =Rs. ( 856,452)
4.Total Equity =Rs. 343,402(1+2+3)
(Rounded to Rs.'000 )
No of shares =Voting -103,300,891
=Non Voting -153,369,800
Total No. of Shares -256,670,691
Net asset value/share =Rs. 1.34

As per BLUE announcement dated 25.01.2012, Proposed amount of capital reduction is Rs, 856,452,000. One can note that this is an amount equal to accumulated losses as given above.
they also say proposed share capital after reduction is Rs, 208,401,543. This amount has calculated as follows;
share capital - accumulated losses(1,064,853,543-856,452,000= 208,401,543

After the capital reduction still total equity remains unchanged.
After capital reduction;

Shere capital =Rs. 208,401,543
General reserve =Rs. 135,000,000
Total Equity =Rs. 343,401,543.(Share capital+General reserve)
Therefore Net asset value per share also remains unchanged as Rs. 1.34

Blue made another announcement for 1 into 14 share split which will be implemented after capital reduction.
Accordingly After split No of shares would be;

Voting Shares =103,300,891x14=1,446,212,474
Non voting Shares =153,369,800x14=2,147,177,200

If any revaluation of assets is not expected fair value could be estimated besed on last market price as follows;

Voting Share( price-7.20) = 7.20/14=0.51 cents
Non Voting Share(price 3.20) = 3.20/14=0.22 cents

SO Net asset value/share = 1.34/14=0.09cents
May be I am wrong.Any one who is interested in BLUE should not depend on solely on above calculations.

10Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Mon Feb 06, 2012 12:19 pm

Kumar

Kumar
Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics
Thanks Rajaraam.

11Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Mon Feb 06, 2012 1:15 pm

Light of Hope


Vice President - Equity Analytics
Vice President - Equity Analytics
@greedy007 wrote:sanjaya351............ you are asking advice?
Oh no.

sanjaya351 you were promoting blue all this time and now asking for advise. you even promoted this after the announcement, if you are not sure why did you promote this crap?

12Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Mon Feb 06, 2012 11:02 pm

RANGANA PERERA


Manager - Equity Analytics
Manager - Equity Analytics
I THINK IS BLUE N IS GOOD TO COLLECT
CURRENT PRICE

13Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Tue Feb 07, 2012 6:58 am

bePositive

bePositive
Senior Manager - Equity Analytics
Senior Manager - Equity Analytics
Collecting, BLUE-N, in large quantities at the current price, could make you very rich when the Market becomes strong in the future.(may be should wait a little while longer to buy as it looks like market will get weaker.)

http://www.viabletraffic.com

14Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Tue Feb 07, 2012 11:44 am

walapingana

walapingana
Equity Analytic
Equity Analytic
@Rajaraam wrote:sanjaya351,

Capital reduction is a good tool to write off accumulated losses and other debit balances in the Balance sheet of a company. When a company decided to write off its accumulated losses from the books that amount has to be charged against the Share capital Account to fullfill the double entry requirements. That is why we call it capital reduction. In fact realy what they want to do is write off the accumulated losses from the books. Once they do that their Balance Sheet is clear and attractive. This would ease the company to borrow funds for expansion, working capital requirement etc.

If we look at the BLUE Balance Sheet (as at 30.09.2011)we can see following figures;

1.Share capital =Rs. 1,064,854
2.General reserve =Rs, 135,000
3.Accumulated Losses =Rs. ( 856,452)
4.Total Equity =Rs. 343,402(1+2+3)
(Rounded to Rs.'000 )
No of shares =Voting -103,300,891
=Non Voting -153,369,800
Total No. of Shares -256,670,691
Net asset value/share =Rs. 1.34

As per BLUE announcement dated 25.01.2012, Proposed amount of capital reduction is Rs, 856,452,000. One can note that this is an amount equal to accumulated losses as given above.
they also say proposed share capital after reduction is Rs, 208,401,543. This amount has calculated as follows;
share capital - accumulated losses(1,064,853,543-856,452,000= 208,401,543

After the capital reduction still total equity remains unchanged.
After capital reduction;

Shere capital =Rs. 208,401,543
General reserve =Rs. 135,000,000
Total Equity =Rs. 343,401,543.(Share capital+General reserve)
Therefore Net asset value per share also remains unchanged as Rs. 1.34

Blue made another announcement for 1 into 14 share split which will be implemented after capital reduction.
Accordingly After split No of shares would be;

Voting Shares =103,300,891x14=1,446,212,474
Non voting Shares =153,369,800x14=2,147,177,200

If any revaluation of assets is not expected fair value could be estimated besed on last market price as follows;

Voting Share( price-7.20) = 7.20/14=0.51 cents
Non Voting Share(price 3.20) = 3.20/14=0.22 cents

SO Net asset value/share = 1.34/14=0.09cents
May be I am wrong.Any one who is interested in BLUE should not depend on solely on above calculations.



Wonderful Raja, concluding your thought, one would not buy at current market price before capital reduction as accumulated losses will be absorbed in the price paid back and after the capital reduction potential prospects would better evidence in the balance sheet

Recommend buying after capital reduction and before or after split

15Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Tue Feb 07, 2012 11:45 am

walapingana

walapingana
Equity Analytic
Equity Analytic
Wonderful Raja, concluding your thought, one would not buy at current market price before capital reduction as accumulated losses will be absorbed in the price paid back and after the capital reduction potential prospects would better evidence in the balance sheet

Recommend buying after capital reduction and before or after split

16Experts pls advise on BLUE Empty Re: Experts pls advise on BLUE on Wed Feb 29, 2012 10:03 pm

mithila abeysekera


Equity Analytic
Equity Analytic
as far as i see..... in CSE it happens the other way around than expected.... funny thing happened today... the blue.x which was stuck at 3.00 was broken down by some one/group cause all of a sudden a big 1,100,000 odd shares were bought all of a sudden. i think a big fish has put hi hands in this!!!!!! anyone noticed it today????

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