Hy there,
Late November it was the very first time, that I surfed around Internet. As one of the former "Gnoms of Zurich" of course I first surfed through the investors pages and checked out the talks. Finally I ended up reading the messages about Fenway. What I understood was, that some people are asking themselves why anybody would short a stock like Fenway with its astonishing project. As I do have a lot of time, I did some research and some homework on Fenway.
Perhaps I can give the people some hints without boring them with a financial analysis of Fenway's announcements.
For a start I would like to ask the Fenway-Bulls to think about the following:
First of all, an investor has to know, that Limestone, the main raw material for cement, is everywhere in the Philipines and is not rare at all in this region.
Second thought: In regard to the shortfall of cement, you should be aware of the fact, that about 10 mio. tonnes production capacity came on stream just recently and further 12 plants are expected to start production in 97. Unfortunately, Fenway is not part of the published project list.
Third thought: When did Fenway announce the date of granting the mining rights? I could not find anything and therefore have to ask, if they have the mining rights at all.
Fourth thought: In the Philipines (like in many other places in the world) the construction and environmental approval for such a project usually takes three (3) to four (4) years. What does the Fenway management make believe that they receive approval within a few weeks and can start construction in 97 and production in 98?
Fifth thought: Did anybody ever made a comparison with other listed cement companies which do have a track record and which are producing for more than 10 years already? If not you should do so, because it will show you, that all the other producers do not even come close to the rate of return as projected by Fenway. Further, you should once compare the market capitalization of the producing companies with Fenway's which in fact is only a "rendered" project on their web page. The result of such a comparison talks for itself, unless you believe that all the others are idiots.
Last but not least: If the profits would be $ 70 to $ 90 per tonne as announced by Fennway's management, do the people (in this case the shareholders) really believe, that the locals, the Taiwanese and the Chinese would let a "White Eye" out of Vancouver pick up the profits?
Gosh is the white world naive....
As I said, I do not want to bore anybody with financials, but boy, the projections of Fenway do not add up at all and in fact are misleading!
You do not believe me? Stay tunded more to follow soon!
Seeya |
