Ho Wah Genting Bhd (HWGB) [9601] (RM0.36 sen/share @ 1/11/2010) which is involved in mining activities saw its share price surging by 80% to 36 sen on November 1 2010 from 20 sen at the start of the year.
Recently, its unit HWG Tin Mining Sdn Bhd was awarded a 10-year mining lease in 2008 to mine tin and other minerals on a 202ha in Pengkalan Hulu with a potential for a further 202ha as work on the initial area progresses.
According to the Companies Commission of Malaysia, HWG Tin Mining is 51% owned by Ho Wah Genting, 35% by Jiwa Seribu Sdn Bhd, 10% by Majuperak Holdings Bhd and 4% by Multi Prolific Sdn Bhd. A check by StarBiz revealed that the Perak royalty directly owns a 35% stake in HWG Tin Ming through Jiwa Seribu Sdn Bhd,which is a 100% wholly owned subsidiary of Ras Sdn Bhd.
HWGB also has 35% stake in a magnesium company called CVM Mining which is listed in HKEX and is worth at about RM110m. The current market cap of HWGB is worth less than this sum (~ RM99m). Thus, its 100%-owned factory in Indonesia producing copper cable/wire and 100%-owned HWGB Tin Mining company as well as some properties coupled with tour bus business are not priced into its share price yet. In other words, if you buy its shares at 36 cents, these businesses are basically free!!
Nonetheless, aside from this, the main impetus is actually tin mining. The boss said that it has reserve of 50,000 ton of tin which is worth about 50,000 x RM 80,000/ton = RM4 billion at current price of tin. But how true the statement is remains unknown. Assuming that it's half true, the tin beneath could worth RM2 billion which is shocking.
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