International Hi-Tech (IHI) Message Board

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Gold/Mining/Energy : International Hi-Tech (IHI)

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To: Ronald P. Margraf Sr. who wrote (445)	7/20/2001 10:34:00 AM
From: Raja	of 461

Hi Ronald..I'm keeping the faith very much! Lots of things about to happen....hopefully this time they WILL happen! ;-)) Check out the raging bull site for lots of info.. ragingbull.lycos.com QUOTE: There is an open question on how profitable IHI factories will be. Several Joint-Venture partners believe they will earn back their $10-$12 Million investment in less than one year, while the rest believe it will be in under 2 years! Company figures are the most conservative and suggest only a 20% gross profit operating margin. However, I believe $6 square foot or more gross profit is easily obtainable. Then is "a full production line" 40,000 or 45,000 square feet? I don't believe IHI factories will be operating only 250 days in most countries, etc. My following numbers are somewhat aggressive, but if you prefer to be conservative, discount them 25%-50%. What will be the market's P/E reward? 10? 20? 30 or more? To believe less than 20, given its potential McDonalds-like franchise growth seems unlikely. Based on $20 million per production line and each factory is expected to have at least 3 lines = $1 per share. This presumes two shifts and IHI receiving 51% of the profits. Assuming the Delta factory begins FULL production by December 2001, and at least 2 factories are finished in 2002 and 5 more in 2003 and 8 more in 2004 and 2005, I estimate their probable EPS as follows: 2002 $ 0.43 [includes one time license fees from 20 coventure partners] 2003 $ 2.16 [includes one time license fees from 20 more projected coventure partners] 2004 $ 7.00+ [includes one time license fees from 20 more projected coventure partners] 2005 $11.00+ 2006 $18.00+ 2007 $25.00+ 2008 $35.00+ Potential earning upgrades due to: Many factories may operate more than 20 days a month on two shifts. More income can be expected from up to 65 more co-venture partners as 100 factories are planned within 10 years. Such production capacity would be equal to slightly less than 1% of the world market. Factories could be built and put into production at a faster rate. Potential earning downgrades due to: If IHI should sell its product at strong discount - currently the plan is to offer only a slight discount as there is such strong demand due to vastly superior product quality and speed of construction. Future private placement financing that involves further share dilution. IHI's 5 year business plan is to build a total of 25 factories by 2006. Our internal price projections for IHI are for a five year possible target of $100 to $250. To compare, stocks like AOL or Microsoft in a comparable time period sold for over $3500; while stocks like Dell or Yahoo reached much greater heights in less time. We find IHI's story equally, if not more compelling. afund.com

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