Cacola

CACOLA announced tonight the appointment of a financial controller, who used to work for them. this stock is low visibility but if downside is limited because of the huge cash it holds (unless those fellas burn the money). If they do a decent job, the stock will re-rate dramatically. Now 5 cents, and upside potential of 100% and it is still in net cash position.

Cacola is 1 cent up from previous posting by Harlequin. Now 6 cents, steady buying queue.

Business turned profitable in 2Q, which is only part of the juicy story. The company has not debt whatsoever, and it has cash of rmb 165 million!

this is S$33 million compared to the market cap of just S$20.1 million.


for it to  trade to cash position, without attaching any value to the profitable business, the stock has to be at 10 cents.

....performance for the last few quarters were disappointing. If the rebound can sustain....this one may be a good buy!!

Are you pinningg much hope on the recovery in profits of Cacola? Only in the 2Q did it report profit when it should have begun recovery about a year ago.

The question now is can the company enjoy a long-lasting recovery on the back of a sizzling China economy? I have no insights into the customer base/profile of Cacola but heard that it is largely low- or mid-range. If only they were mid to high-end, then we would have seen a strong rebound in business like Man Wah.

The 3Q result will be out in a few weeks and if it's another profit recovery, then the market will consider the evidence as being clearer that the stock is worth a lot more than 6 cents currently.

The most obvious reason for buying now, if you are prepared to take a calculated risk, is that, you don't think Cacola will sink into a loss-making 3Q or in the near-term.

Already, its net cash per share is sufficient buffer against any nightmare of a downnside. Question is, will its stock price show a great deal of momentum upwards? Or just stagnate.

Cleard 6 cents.....more upside?

2Q was profitable alright but only RMB3.7 million, which is peanuts still. If 3Q can show stronger profits, then the stock can be re-rated and it would be a very sharp re-rating as the NAV is 20 sing cents compared to 6 cents stock price.

the financials on their own are sexy cos Cacola has zero borrowings and RMB165 m in cash, which is far higher than the S$22 million market cap now. 

This stock has no doubt been a huge disappointment to those who bought it pre-Oct 2008 at 20-50 cents.

Its investor relations sucks - there is none to speak of all these 2 or 3 years, so you dont know what really is going on and there is no more analyst coverage and there is no one you can email to ask for clarity. All in all, a lot of risk remains.