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Flame Tree Group HY15 PAT up marginally
Rank: Chief Joined: 1/3/2007 Posts: 18,099 Location: Nairobi
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Ebenyo wrote:Pesa Nane wrote:Aguytrying wrote:VituVingiSana wrote:@Aguy - No merali connection as far as I know.
Mauritius is used as the HQ for many firms that do business in Africa thanks to their Double Taxation Agreements, English Law and easy-to-do-business environment. I think the Kichennins are what are known as 'resident' directors of the "parent" hq'd in Mauritius but HB calls the shots.
The info @PesaNane has provided has given me pause. I will look into the firm's financials further. I have to admit, I like Centum's performance under Mworia and if HB can deliver even 50% of what Mworia has done...
Caution: Manufacturing is not an easy path to take in Kenya. Yeah its good to keep one eye open, ill also look further and give more time to understand this company admittedly, the chance of insane returns does exist (at the correct price) but the quality for a portfolio mainstay is another monster altogether (hence, hand at the eject button) Whats their current dividend yield? dividend per share? eps? PE? I read somewhere that this company their main business ni kuuza pilipili,is that so? SMH. Kusoma ni bure. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Chief Joined: 1/3/2007 Posts: 18,099 Location: Nairobi
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Pesa Nane wrote:Aguytrying wrote:VituVingiSana wrote:@Aguy - No merali connection as far as I know.
Mauritius is used as the HQ for many firms that do business in Africa thanks to their Double Taxation Agreements, English Law and easy-to-do-business environment. I think the Kichennins are what are known as 'resident' directors of the "parent" hq'd in Mauritius but HB calls the shots.
The info @PesaNane has provided has given me pause. I will look into the firm's financials further. I have to admit, I like Centum's performance under Mworia and if HB can deliver even 50% of what Mworia has done...
Caution: Manufacturing is not an easy path to take in Kenya. Yeah its good to keep one eye open, ill also look further and give more time to understand this company admittedly, the chance of insane returns does exist (at the correct price) but the quality for a portfolio mainstay is another monster altogether (hence, hand at the eject button) I am a fan of Warren Buffett. He buys all sorts of businesses. - Some businesses can stand on their own. They may not grow their profits by much every year but are CASH POSITIVE. He uses this cash to buy other firms. See's Candy is an example. - Some businesses require massive (new) investment eg BNSF (railway) to create a source of long-term POSITIVE CASHFLOW. - Some businesses are cashflow neutral while growing in size & profitability like GEICO (Insurance). They use the profits/cash to grow larger until profitable growth is 'maxed out'. Then start paying dividends. HB needs to follow WB's philosophy not Merali or Matu's thieving ways. Run the businesses for long-term CASH GENERATION not loss-making size like the crooks at KQ did. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 4/4/2016 Posts: 1,997 Location: Kitale
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Aguytrying wrote:Ebenyo wrote:Pesa Nane wrote:Aguytrying wrote:VituVingiSana wrote:@Aguy - No merali connection as far as I know.
Mauritius is used as the HQ for many firms that do business in Africa thanks to their Double Taxation Agreements, English Law and easy-to-do-business environment. I think the Kichennins are what are known as 'resident' directors of the "parent" hq'd in Mauritius but HB calls the shots.
The info @PesaNane has provided has given me pause. I will look into the firm's financials further. I have to admit, I like Centum's performance under Mworia and if HB can deliver even 50% of what Mworia has done...
Caution: Manufacturing is not an easy path to take in Kenya. Yeah its good to keep one eye open, ill also look further and give more time to understand this company admittedly, the chance of insane returns does exist (at the correct price) but the quality for a portfolio mainstay is another monster altogether (hence, hand at the eject button) Whats their current dividend yield? dividend per share? eps? PE? I read somewhere that this company their main business ni kuuza pilipili,is that so? Ebenyo you're a comedian. Go to their website and download annual report, all the info is there. Go to rich.co.ke for a summary also @Aguy and VVS, kwani mumenitupa kama vile Obiero alinitupa? i was folowing you two and enyands.Pesa nane is also fine.i also try to help the hellos and newfarers now that im a member. Dont get me wrong.I sometimes try to put hard facts in a simple format so that anybody can understand.Its easy to mistake it as joking or comedy.Lazima tukuweko pia na some light momentseven as we strive to gain.They release tension. Aguy,i like your argument on Equity and Kcb.You have earned my respect their.VVS and Enyands,i like their facts also.Pesa nane is great too. This thread FTGH,i have taken interest just because Aguy,VVS and pesa nane are their.But after checking now that dividend yield is 0.00%,i guess i will be less interested.The business modell is like what centum is doing.Acquiring other businesses.Im not impressed.Why not build one strong business first nefore moving to the next one?.This idea of acquiring many small businesses with no focus on any one does not augur well for me. Towards the goal of financial freedom
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Rank: Chief Joined: 1/3/2007 Posts: 18,099 Location: Nairobi
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@Ebenyo - Berkshire, Centum and FTG are 'conglomerates' ... In other words, they are CORPORATE representations of most individual investors. You @ebenyo are a conglomerate. You probably have shares, land [not a farm], a farm and cash/bonds. You do not just pick one but look around for value and diversification. Conglomerates grow out of an individual's initial investment. I think for Bangera, who currently owns 80% of FTG but owned 100% at one time, it was first the Roto Tanks [according to the bio] then beauty and finally foods. Some have performed better than others. Some will perform better than others. The challenge for HB is to identify and invest in the BEST businesses. Centum's history is different but as ICDCIC it invested in many businesses and not all did well. Kirubi took it over and changed the name to Centum. Mworia chose "Real Estate Development" as the core business but Centum has substantial stakes in many Kenyan businesses including finance (Sidian, Platinum), Beverages (Coca-Cola), etc. Warren Buffett bought Berkshire Hathaway [a cloth mill business] but started investing in any business that made sense to him (& Munger) especially Insurance. When he felt insurance had 'matured' (or getting very competitive) he started buying industrial concerns like Marmon, BNSF (transport) and Precision Castings. He also owns many other businesses that are very different from each other. From manufacturing high-tech airline parts to underwear. Can Bangera continue PROFITABLY growing FTG's businesses? Can he do so without coming to shareholders for a Rights Issue? Can he do so without over-burdening FTG with debt? Does he have the foresight (and luck) to pick the right divisions to promote with additional cash for expansion? Would he be amenable to building up and then selling off a division e.g. beauty to another firm at the right price? Would he be amenable to merging a fully-owned division eg Roto Tanks with a competitor to gain scale but own only 40% & losing control of a bigger entity? It's a bet on the entrepreneur... As an EXTERNAL investor one has to be careful. After all it is our money. I have been burnt back in the day on Olympia. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 4/4/2016 Posts: 1,997 Location: Kitale
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VituVingiSana wrote:@Ebenyo - Berkshire, Centum and FTG are 'conglomerates' ... In other words, they are CORPORATE representations of most individual investors.
You @ebenyo are a conglomerate. You probably have shares, land [not a farm], a farm and cash/bonds. You do not just pick one but look around for value and diversification.
Conglomerates grow out of an individual's initial investment. I think for Bangera, who currently owns 80% of FTG but owned 100% at one time, it was first the Roto Tanks [according to the bio] then beauty and finally foods. Some have performed better than others. Some will perform better than others. The challenge for HB is to identify and invest in the BEST businesses.
Centum's history is different but as ICDCIC it invested in many businesses and not all did well. Kirubi took it over and changed the name to Centum. Mworia chose "Real Estate Development" as the core business but Centum has substantial stakes in many Kenyan businesses including finance (Sidian, Platinum), Beverages (Coca-Cola), etc.
Warren Buffett bought Berkshire Hathaway [a cloth mill business] but started investing in any business that made sense to him (& Munger) especially Insurance. When he felt insurance had 'matured' (or getting very competitive) he started buying industrial concerns like Marmon, BNSF (transport) and Precision Castings. He also owns many other businesses that are very different from each other. From manufacturing high-tech airline parts to underwear.
Can Bangera continue PROFITABLY growing FTG's businesses?
Can he do so without coming to shareholders for a Rights Issue?
Can he do so without over-burdening FTG with debt?
Does he have the foresight (and luck) to pick the right divisions to promote with additional cash for expansion?
Would he be amenable to building up and then selling off a division e.g. beauty to another firm at the right price?
Would he be amenable to merging a fully-owned division eg Roto Tanks with a competitor to gain scale but own only 40% & losing control of a bigger entity?
It's a bet on the entrepreneur... As an EXTERNAL investor one has to be careful. After all it is our money.
I have been burnt back in the day on Olympia. @VVS,thanks for indepth analysis of the FTGH.I now see some facts clearly which will help me decide whether i join this ship or not. Towards the goal of financial freedom
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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Ebenyo wrote:VituVingiSana wrote:@Ebenyo - Berkshire, Centum and FTG are 'conglomerates' ... In other words, they are CORPORATE representations of most individual investors.
You @ebenyo are a conglomerate. You probably have shares, land [not a farm], a farm and cash/bonds. You do not just pick one but look around for value and diversification.
Conglomerates grow out of an individual's initial investment. I think for Bangera, who currently owns 80% of FTG but owned 100% at one time, it was first the Roto Tanks [according to the bio] then beauty and finally foods. Some have performed better than others. Some will perform better than others. The challenge for HB is to identify and invest in the BEST businesses.
Centum's history is different but as ICDCIC it invested in many businesses and not all did well. Kirubi took it over and changed the name to Centum. Mworia chose "Real Estate Development" as the core business but Centum has substantial stakes in many Kenyan businesses including finance (Sidian, Platinum), Beverages (Coca-Cola), etc.
Warren Buffett bought Berkshire Hathaway [a cloth mill business] but started investing in any business that made sense to him (& Munger) especially Insurance. When he felt insurance had 'matured' (or getting very competitive) he started buying industrial concerns like Marmon, BNSF (transport) and Precision Castings. He also owns many other businesses that are very different from each other. From manufacturing high-tech airline parts to underwear.
Can Bangera continue PROFITABLY growing FTG's businesses?
Can he do so without coming to shareholders for a Rights Issue?
Can he do so without over-burdening FTG with debt?
Does he have the foresight (and luck) to pick the right divisions to promote with additional cash for expansion?
Would he be amenable to building up and then selling off a division e.g. beauty to another firm at the right price?
Would he be amenable to merging a fully-owned division eg Roto Tanks with a competitor to gain scale but own only 40% & losing control of a bigger entity?
It's a bet on the entrepreneur... As an EXTERNAL investor one has to be careful. After all it is our money.
I have been burnt back in the day on Olympia. @VVS,thanks for indepth analysis of the FTGH.I now see some facts clearly which will help me decide whether i join this ship or not. Well said by @vvs. Small companies like FTGH are for savvy investors, especially guys with resources to do a due diligence and launch a take over bid. A portifolio investor is too exposed because of weak governance structures. Decisions of management do not necessarily align with interests of portifolio investors. Case in point is Meralli, Somens, CMC, rogue DJ, Home Afrika, Olympia. Secondly, the cost of expansion capital is higher for small companies than the bigger companies eg Centum and HFC get cheaper corporate bonds and deposits from their banking arms while Home Afrika struggles with expensive bank loans. Cost of capital and weak governance has stunted firms like Hutchings Biemer, Express Kenya, Car and General, Marshalls EA, Olympia. A portifolio investor is better off with Centum which has better governance structures, access to cheaper capital and now trading at 0.69 of NAV. Life is short. Live passionately.
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Rank: Chief Joined: 1/3/2007 Posts: 18,099 Location: Nairobi
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I prefer firms, whatever size, whose management I 'trust' but I want to be clear about one thing... I have been fooled many times. KQ - I was a fan of Naikuni. I was conned. They started expanding too fast [ego] but the managements was in it for undeserved bonuses, salaries, perks and kickbacks. Shame on @VVS for missing the signs. Olympia - Sigh. A con job from the beginning by Michael Matu with his father's support. Shady deals. Shame on @VVS for missing the signs. Merali - I was lucky that I did not trust him from the beginning thanks to a gentleman who asked/advised me to read every line of the Information Memorandum of Firestone. He would cut side-deals e.g. Sameer Business Park that was structured to steal from the other shareholders. TransCentury, HAFR - These listed at a time when I had (finally) learnt some lessons on what NOT to buy. I did not trust the management/board of either then. HAFR has a new board so it's a wait & see. KenolKobil - Segman did a number on KK since his incentive (options package) was skewed to encourage gambling. And Segman did just that on currency and oil hedges. And lost. Ohana seems to be someone with more restraint. Lesson: Look at the CEOs (or decision-makers) incentives for making the decisions they make. Shame on @VVS for missing the signs. Which brings me to FTG. So far, so good. It's not a spectacular firm. It's not a flashy firm. It's a firm that should plod along making profits & growing. The CEO's 80% shareholding is a huge plus since he has a lot to lose. AT THIS POINT, I do not believe he is a Matu or Merali hence I am OK investing (slowly) in FTG. This is not a core holding for me and unlikely to be in 2016 but one that I will definitely follow. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Member Joined: 3/3/2016 Posts: 132
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VituVingiSana wrote:
Merali - I was lucky that I did not trust him from the beginning thanks to a gentleman who asked/advised me to read every line of the Information Memorandum of Firestone. He would cut side-deals e.g. Sameer Business Park that was structured to steal from the other shareholders.
Great lessons there. Thanks for sharing. What's the Sameer Business Park story? I missed that. And the Firestone IM, what did you find?
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Rank: Chief Joined: 1/3/2007 Posts: 18,099 Location: Nairobi
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When Firestone went public, inside the IM was buried a juicy morsel. Merali was in bed with Moi & his cronies. He exercised his "First Right of Refusal" to buy shares in Firestone from ICDC at 5/- then turned around and sold them at 35.50 on the NSE. The buyers included gullible Kenyans AND the NSSF. It just stank of shadiness. Sameer Business Park - Merali hived off a prime piece of land from the Firestone/Sameer (which is listed). It was transferred to an entity he owned 75% of with Sameer owning only 25%. He used the land as collateral to borrow money and build out the park. Instead of building the business park under a subsidiary of Sameer Tyres and sharing the benefits with ALL shareholders, Merali built it under a firm he owns 75% of using land hived off from Sameer Tyres which only got 25%. The loan to build SBP was taken based on the land. So Merali gets 75% of the net assets of SBP for free. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Member Joined: 5/4/2015 Posts: 241 Location: Kahno
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It's yawning for buyers @ 4.65
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Rank: Elder Joined: 7/11/2010 Posts: 5,040
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kimanimsc wrote:It's yawning for buyers @ 4.65 I'm ready to snap them up The investor's chief problem - and even his worst enemy - is likely to be himself
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Rank: Chief Joined: 1/3/2007 Posts: 18,099 Location: Nairobi
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Aguytrying wrote:kimanimsc wrote:It's yawning for buyers @ 4.65 I'm ready to snap them up I swear I am losing it!  Have they released 1H 2016 results? Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 7/11/2010 Posts: 5,040
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VituVingiSana wrote:Aguytrying wrote:kimanimsc wrote:It's yawning for buyers @ 4.65 I'm ready to snap them up I swear I am losing it! Have they released 1H 2016 results? Hahaha. Not yet. Im just wondering about the guys who got in private placement, they must be cursing Bangera. As long as biz is intact lower prices means good hunting ground The investor's chief problem - and even his worst enemy - is likely to be himself
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Rank: Veteran Joined: 7/1/2014 Posts: 903 Location: sky
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selling spree!! my order at 4.30 just completed! There are only two emotions in the stock market, fear and hope. The problem is, you hope when you should fear and fear when you should hope
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Rank: Member Joined: 5/4/2015 Posts: 241 Location: Kahno
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littledove wrote:selling spree!! my order at 4.30 just completed! Tomorrow, another 9% drop takes us to 3.9
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Rank: Member Joined: 5/30/2016 Posts: 332 Location: Kayole
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kimanimsc wrote:littledove wrote:selling spree!! my order at 4.30 just completed! Tomorrow, another 9% drop takes us to 3.9 Merali reloaded KEGN, KPLC, KQ, SCOM
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Rank: Elder Joined: 7/11/2010 Posts: 5,040
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mkate_nusu wrote:kimanimsc wrote:littledove wrote:selling spree!! my order at 4.30 just completed! Tomorrow, another 9% drop takes us to 3.9 Merali reloaded Why merali? The investor's chief problem - and even his worst enemy - is likely to be himself
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Rank: Veteran Joined: 1/20/2011 Posts: 1,820 Location: Nakuru
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NBV= 2.54 EPS =1.1 PE = 3.909 DPS = 0 based on the above, i would say that it is still trading at a premium. Can only consider it at sub 3 bob Dumb money becomes dumb only when it listens to smart money
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Rank: Member Joined: 5/30/2016 Posts: 332 Location: Kayole
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Aguytrying wrote:mkate_nusu wrote:kimanimsc wrote:littledove wrote:selling spree!! my order at 4.30 just completed! Tomorrow, another 9% drop takes us to 3.9 Merali reloaded Why merali? Notice how at an EPS of less than 1 most companies can afford to dish out a dividend. The 80 % ownership is not necessarily a good thing for other investors since he gets his cut as CEO and board member. Add Mauritius and some funny sounding directors, top up the latest acquisition sprees in the mix (remember this?How Naushad Merali made Sh1.6 billion ($20m) in one hour and you are in for a nasty ride. If it smells like a rat, behaves likes a rat ... My opinions should not be taken as advice/recommendations/considerations to avoid, sell or buy this stockKEGN, KPLC, KQ, SCOM
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Rank: Member Joined: 5/30/2016 Posts: 332 Location: Kayole
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kimanimsc wrote:littledove wrote:selling spree!! my order at 4.30 just completed! Tomorrow, another 9% drop takes us to 3.9 Manabii halisi wa wazua  KEGN, KPLC, KQ, SCOM
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