Renesola and Another Dear John Letter

Tuesday, 21 September, 2010 19:23 Written by Paul 0 Comments

Readers of Investor Trader may remember my brief tryst with West China Cement which came to a premature end back in May of this year.

Sadly, growth saw them forget their roots, pull their AIM listing and try to make it in the big city. In this case, the big city being Hong Kong. And as it turns out, the big city has been quite kind witnessing gains in WCC in excess of 20% in the month since they headed east. I was willing to take that one on the chin. Let bygones be bygones and all that. Until……

Until yet another Dear John letter from my broker. This time it’s my beloved Renesola (another Chinese share) that are pulling their AIM listing and heading for another big city, well big apple to use the local parlance, New York. And no, my broker doesn’t trade on the NYSE. You seeing the theme here?

Anyway, to cut a long story short, I can either hunt down a broker that can trade across the pond or I can give up on my Renesola’s and keep my hard-earned in UK listed shares. I’ve got until early November to make my decision.

The spanner in the works is that Renesola is really flying at the minute making the timing all important.

I’ve been in and out of Renesola for years now and it’s the one share that I have consistently profited from. I’ve bought in at under a pound and I’ve sold at over six pounds with lots of buys and sells in between (and always for a profit I might add).

Currently Renesola sits just north of £3.50. Our portfolio holds 1,000 SOLA.L with an average purchase price of £1.12. If we sold today we’d be looking at a triple-bagger, not too bad by any standards, but it’s the forcing of my hand that I find hard to stomach.

So, what to do? Would you be looking at bailing out after a month like the one below?

Watch this space.

West China Cement – A Love Story

Wednesday, 12 May, 2010 12:13 Written by Paul 2 Comments

It’s with a heavy heart that today I write about my sale of West China Cement.

Our brief love affair – this time around, for we have loved before – began in July 2009 when I picked up 153 of these little grey beauties at £1.70. Watching our love take flight, two short weeks later I added another 221 shares at an already soaring £2.57. My 374 shares were averaged in at £2.21, for a total outlay of £828.21 before costs. Ahhh, the early days of a relationship.

At the dawn of our wonderful time together West China Cement surged through £3 before flitting around £4 for a spell. She then busted through £5, then £6 and briefly flirted with £7. What a beauty!

With a rendezvous with the Hong Kong board on the horizon, I was confident when we met, that her price would be heading in one direction, and one direction only. And WCC.L didn’t let me down. Could it be that I could be holding a five-bagger, hell, even a ten-bagger. Did this tryst have no bounds?

Then the dreaded ‘Dear John’ email from my broker. I’ll cut to the chase……..”we are unable to trade equities on the Hong Kong board”. Heartbreak!

Now it was at this time I had a decision to make. Transfer the shares to another broker – a broker that traded in Hong Kong securities, a broker alas, I did not have – and continue our fling or remember the beautiful times we had together and go searching for other AIM runaways.

I choose the later and I’ll tell you why.

It’s not everyday you land a triple-bagger in ten months – I sold out at £6.60 on the 4th May for a total return of £2,468.40, a profit of £1,640.19 on top of an £828.21 investment.

Moreover, the situation in Greece had kicked in and although I had faith that it would be resolved (patched up) quickly, confidence in the markets for weeks even months following is bound to be dented. A pound had already been knocked off WCC’s recent highs. And at the end of the day we had loved before and chances are we will love again.

Alfred Lord Tennyson put it best when he said, “it is better to have loved and lost than never to have loved at all“. And chances are he hadn’t just cashed in on a triple-bagger.

Now I’m off to open an account with a broker that allows me to trade in Hong Kong. Remember to do a ton of your own research and thanks again for dropping by.

Cement’s Taking Off

Sunday, 07 March, 2010 04:00 Written by Paul 0 Comments

Early last week West China Cement caught my eye after finishing the day up 34 pence at 490 pence, a rise of a little over 7% on the day.

At that point after a little positive pondering, I postulated that if WCC could breach the 5 quid mark that week and remain there – remaining there’s a biggy – then it could be onward and upward for West China Cement in the coming weeks and months.

Well, it not only breached the 5 quid mark it smashed that particular ceiling finishing the week at 585 pence, up a chunky 125 pence from the Friday before.

The reason? It doesn’t take Buffet to tell you that Friday’s Preliminary Results – whose highlights I’ve, well, highlighted below – were enough to stimulate more than a little interest.

Take a look for yourself:

Revenue increased by 75% from RMB866 million in 2008 to RMB1,517 million in 2009.
Operating profit increased by 118% from RMB283 million in 2008 to RMB616 million in 2009.
Gross profit margins improved from 36% to 42% and operating profit margins improved from 33% to 41%, reflecting strong product prices, efficiency gains and economies of scale.
Redemption of the 7.8 million warrants in November 2009, giving rise to an exceptional charge of RMB168 million, removing liquidity risk and risk of substantial dilution to our shareholders.
Pre-tax profit increased by 111% to RMB544million before the exceptional item and 45% to RMB375 million after the exceptional item. Earnings per share amounted to RMB7.73 before this exceptional charge and RMB5.12 after the exceptional charge.
Return on Capital Employed (EBIT/Net Assets) of 47.6% (2008: 30.5%).
We are on schedule for listing on the Main Board of the Hong Kong Stock Exchange before 30 June, 2010.

Of particular interest (besides all those pretty numbers) is the last point. I for one will be holding on tight to my WCC holdings as I think concrete’s about to fly and grey is this year’s black.

Remember, none of this should be construed as investment advice, I’m a mug investor who very occasionally gets it right. Please, please, please do your own homework from a ton of sources before parting with your hard earned. And when you’ve had a win, visit Kiva and share a little of your wealth with a third world entrepreneur.

West China Cement

Tuesday, 02 March, 2010 05:58 Written by Paul 0 Comments

First off allow me to apologise for the infrequency of my posting of late. Rather than braving the European chill, for the last month I’ve been avoiding things that slither and sting down under. I’ve swapped my laptop for a beach towel and the only stock that’s piqued my interest has been the stock of beer in the esky.

I’ve attempted to keep an eye on things financial whilst I’ve been here, but to be honest, any minor portfolio value gains I’ve made in that time seem to have been offset by corresponding minor losses with a net effect of, well, pretty much zero.

West China Cement did catch my eye Monday however, finishing the day up a chunky 34 pence (7.4%) at 490 pence.

We jumped into West China Cement – don’t get stuck in the pun – back in mid July at 170 pence and topped up in August at 257 pence. And since then there’s been strong talk of a Hong Kong listing with the price going from strength to strength.

The five quid barrier was breached once late last year, but only briefly. It’s a significant barrier and if WCC can break through it again and sustain the price above that psychological ceiling, then in my humble opinion, the coming months could see further strong gains.

Anyway, the day is young and the sun is shining so I better get back to it. That beer ain’t gonna drink itself!

Graph supplied courtesy of Interactive Investor - http://www.iii.co.uk

Selling a Few Clipper Windpower

Sunday, 04 October, 2009 15:46 Written by Paul 0 Comments

The last couple of weeks has seen a little turnaround in the fortunes of our – predominantly – small capped portfolio. The recent rise and rise of the FTSE seems to indicate that there’s still faith in the market in general so maybe it’s a case of people taking from AIM to invest in the main board.

Whatever the case, we’ve decided to pocket a little profit from our Clipper Windpower holdings for no other reason than when things get a little jittery it’s nice to take a little profit here and there.

We bought into Clipper Windpower back in May ’09 at 104.95 pence and we’re selling off 295 of the 895 shares we hold at 177.00 pence, in the the process, turning a 68% profit in a little less than 5 months. So that’s another £522.15 before trading costs into the coffers.

We still have plans to top up on Renesola at the lower levels they’ve experienced of late, but it’s a possibility they may test lower still so we’ll bide our time a little and see if we can’t catch them as they bounce off support a little further south. Same goes for China Biodiesel and West China Cement. We’ll be keeping a close eye on all three of our Chinese holdings over the coming days to seek an optimum entry point.

Posts Tagged ‘West China Cement’

Renesola and Another Dear John Letter

Cement’s Taking Off

West China Cement

The Day in Numbers

Our Charismatic Benefactors

Our Friends at Kiva

Investor Trader Categories

Investor Trader Archives

Sites We Dig

Posts Tagged ‘West China Cement’

Renesola and Another Dear John Letter

West China Cement – A Love Story

Cement’s Taking Off

West China Cement

Selling a Few Clipper Windpower

The Day in Numbers

Our Charismatic Benefactors

Our Friends at Kiva

What We Rant About

Investor Trader Categories

Investor Trader Archives

Sites We Dig