wondering bout kzoo

ob1s · 1 wondering bout kzoo Mon Jun 20, 2011 1:10 pm

ob1s

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its seems this is on a downward trend...it did hit 7000 last week now down to 3200...do u think this stock will pick back up..at 3000 not a bad stock to own...
any good ideas for end of day stock buying...

schacha · 2 Re: wondering bout kzoo Mon Jun 20, 2011 1:16 pm

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Get some more ppl to blow the bubble.. Very Happy

Gaja · 3 Re: wondering bout kzoo Mon Jun 20, 2011 1:19 pm

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somebody expected this share will touch 20,000/= even

anees · 4 Re: wondering bout kzoo Mon Jun 20, 2011 2:31 pm

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kiwi · 5 Re: wondering bout kzoo Mon Jun 20, 2011 2:33 pm

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@ob1s how did you conclude that kzoo at 3,000 is a good share to own?

Slstock · 6 Re: wondering bout kzoo Mon Jun 20, 2011 2:39 pm

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Firsy question to ask is why did this share go up? Based on what?

Please see the below. Some of us warned that there will be big drop. Hope no one bought at Rs 7000 level.

http://forum.srilankaequity.com/t4963-kzoo-scam-by-one-or-several-shareholders?highlight=kzoo

cse.alpha · 7 Re: wondering bout kzoo Mon Jun 20, 2011 3:06 pm

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KZOO recent interest has more to do with lack of shares (only 50,000 shares in issue for KZOO, and only 450 needed to enter top 20 shareholders at 31st Dec 2010), than its company fundamentals.

2,500 shares traded today, the most the past month - this is 5% of KZOO company.

It is on the default board, not having released its March 2011 results.

KZOO 9 month net profit of Rs 2.7 million (9 month EPS of Rs 55) was largely due to other income of Rs 2.5 million (asset disposal). Taking this out, 9 month recurring EPS was just Rs 4.

Book value per share was Rs 713 at 31st Dec 2010.

KZOO attracted attention previously as potential shell company for a takeover like GREG and CSEC in the past - usually a premium would be payable over book value to reflect listing rights of target company. How much of a premium ? Example of Rs 25 million premium, gives Rs 500 per share premium for KZOO over book value per share of Rs 713.

Split speculation always exists for high priced share companies (e.g. KZOO, SWAD, NEH, PHAR etc), but they do not change fundamentals of company. Check that valuations make sense first before buying into split rumours.

Deeply discounted rights issue (like was done at WAPO) is possible, but without inside news, impossible to say for sure whether will happen at KZOO.

kiwi · 8 Re: wondering bout kzoo Mon Jun 20, 2011 3:15 pm

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@cse.alpha you do raise a valid point about the attraction of kzoo as a potential shell company. I think you are spot on with the simple calculation that you have applied and I would think that Rs 25mn as a premium is about spot on. I went back and looked at the cost of IPO's and they were all within that range. From memory the big Browns Investments IPO cost was put down as 25mn. I get very frustrated at the silly premiums that are paid due to split speculation which have no bearing as you so correctly say on the fundamentals of the company.

StocksWatch · 9 Re: wondering bout kzoo Mon Jun 20, 2011 3:45 pm

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cse.alpha wrote:KZOO recent interest has more to do with lack of shares (only 50,000 shares in issue for KZOO, and only 450 needed to enter top 20 shareholders at 31st Dec 2010), than its company fundamentals.

2,500 shares traded today, the most the past month - this is 5% of KZOO company.

It is on the default board, not having released its March 2011 results.

KZOO 9 month net profit of Rs 2.7 million (9 month EPS of Rs 55) was largely due to other income of Rs 2.5 million (asset disposal). Taking this out, 9 month recurring EPS was just Rs 4.

Book value per share was Rs 713 at 31st Dec 2010.

KZOO attracted attention previously as potential shell company for a takeover like GREG and CSEC in the past - usually a premium would be payable over book value to reflect listing rights of target company. How much of a premium ? Example of Rs 25 million premium, gives Rs 500 per share premium for KZOO over book value per share of Rs 713.

Split speculation always exists for high priced share companies (e.g. KZOO, SWAD, NEH, PHAR etc), but they do not change fundamentals of company. Check that valuations make sense first before buying into split rumours.

Deeply discounted rights issue (like was done at WAPO) is possible, but without inside news, impossible to say for sure whether will happen at KZOO.

You have nicely summerized KZOO's situation. I think there is no need for any reason for the prices of these extremely illiquid shares to fluctuate. Buying or selling of few hundred shares can cause the price to have a steep fluctuiation.