Dangote flour

[Yusuf]

After reading your analysis Windywendy, I cannot but look like a fool.

How?

I want to confess in this forum that for the first time since I joined stock market investment, I am investing on a stock in a big way without looking at details. I must confess that I was the first person that paid for this stock with my bank. I even forced them to collect my money when there was no account opened yet for the offer. I have to stay on their head to get the money paid in. I felt so bad with myself for falling into such speculative temptation.

Though I did not regret buying Dangote flour but I regretted not looking at the prospectus before making payment. I felt as if I should rewind everything and get my money back while I take a look at the prospectus again before paying after reading that analysis.

That is a good one Windywendy and keep it up. It only proof to me that I am dining with the right set of people.

I learnt one more lesson today.

Remain Bless!!

[hispy99]

Dangote Flour offer extended by 10 days

http://www.punchng.com/Articl.aspx?t...20070927148126

[Taipan]

Originally Posted by windywendy

...
Lastly, you say that the stock is capable of yielding a 100% return over an 18 month period? Well, maybe so, maybe not. However, if I have to wait 18months to get a 100% return, then why not invest in less uncertain stocks that can potentially deliver a much higher return in that same time frame? Dangflour is not worth it in my opinion. It’s currently overvalued and I don’t believe in its prospects.

Windywendy, see what you've caused! There's chaos in the house cause of your epistle!
Anyway, you've really made me smile, sorry laugh. I was planning to buy Dangote Flour today until I read your gospel. Now, no way!!
Thinking of Dangote Sugar instead. Say, what d'you think about that?

[Survival2006]

Thought it was all flour and bag business for Dangote Flour. Did I hear it will also engage in the production of PRAYER MAT? And two significant changes have happened, within this short space of time of the IPO, aside from the earlier rumour:

1) The preferential allotment has been reduced from 60% to 20% (IN WHOSE INTEREST?)
2) The closing date has been extended by 10 good days.

And all this for an IPO that was even rumoured will be done by PP!

Good thing JAPAUL is around the corner. BYE to other POs or IPOs!

[chidianosike]

I guess 'Dang' is getting feelers that this IPO may not be successful or oversubscribed as anticipated. Hence their last minute scamble to lower the stakes and let more people in.

[windywendy]

Originally Posted by Yusuf

After reading your analysis Windywendy, I cannot but look like a fool.

How?

I want to confess in this forum that for the first time since I joined stock market investment, I am investing on a stock in a big way without looking at details. I must confess that I was the first person that paid for this stock with my bank. I even forced them to collect my money when there was no account opened yet for the offer. I have to stay on their head to get the money paid in. I felt so bad with myself for falling into such speculative temptation.

Though I did not regret buying Dangote flour but I regretted not looking at the prospectus before making payment. I felt as if I should rewind everything and get my money back while I take a look at the prospectus again before paying after reading that analysis.

That is a good one Windywendy and keep it up. It only proof to me that I am dining with the right set of people.

I learnt one more lesson today.

Remain Bless!!

Thanks Yusuf. Don't feel too bad, the stock may yet do well due to sentiments -- just take a look at nigerian wire and cable, but I'm just not too convinced about it being a good fit for my portfolio.

On a different note though, you should always at least attempt to read through the prospectus before investing in any offer, it usually contains some interesting information. Also, there's usually no need to rush into any offer as soon as it opens. I usually wait until I'm thoroughly satisfied before picking up the form, and I often take advantage of the extra 2-week period that brokers have to make their returns before turning in my form.

The good in all this is that you've at least learned something that'll be a very valuable lesson in your investing future

[windywendy]

Originally Posted by Taipan

Windywendy, see what you've caused! There's chaos in the house cause of your epistle!
Anyway, you've really made me smile, sorry laugh. I was planning to buy Dangote Flour today until I read your gospel. Now, no way!!
Thinking of Dangote Sugar instead. Say, what d'you think about that?

I haven't caused anything oh! It's dangote that's trying to sell us his lemons . . .

I believe DSR is a good buy at the current price. There was a thread on DSR in which I had an extensive discussion with another forum member, and I still believe in that company's prospects. Can't find the thread right now but if you can find it, it contains some interesting discussion.

[windywendy]

Originally Posted by Betiku Franklin Olugbenga

Thank you for the indepth analysis windywendy, now that you are very skeptical about dangflour what do you suggest we do with the shares to make some reasonable gains on a short term.

i bought 50,000 share unit from the IPO.

What d'you also think of survival2006 opinion on japaul oil and C & I leasing gaining about 25 - 30% each by january of next year.

Think its visible?

Betiku, i'm sorry, but I usually have a really hard time recommending short term stocks, mostly because I take a more long term view in my analyses. I don't know much about Japaul or C&I leasing at the moment and really can't predict what they'ld do by Jan. 2008.

but if you're into short term trading, why not watch the market trends and invest in stocks that have hit their lows and look like they might rebound. I don't do this, but I've heard from some who do that it works. There's a thread on "trading vs. investing" that might contain some info.

[laman]

While I agree with wendy wendy that dangsugar is at a good price now and you can buy, I disagree that dangflour will not do well in the short run. The demand clearly outstrips the supply. This will invariably push the price up.Stock prices are not only determined by fundamentals alone,(although this is very important), other factors come to play. That is why there is what is termed "overvalued and undervalued stocks". Overvalued or not they are still traded. This is usually a very bad month for stocks with the fact that there are a lot of offers which is making people offload their stocks to get into ipos. Thats the reason for the fall of the prices in the market today, they will go back to their prices. Worst scenerio for dangflour 22 naira jan -march

[Yusuf]

Originally Posted by laman

While I agree with wendy wendy that dangsugar is at a good price now and you can buy, I disagree that dangflour will not do well in the short run. The demand clearly outstrips the supply. This will invariably push the price up.Stock prices are not only determined by fundamentals alone,(although this is very important), other factors come to play. That is why there is what is termed "overvalued and undervalued stocks". Overvalued or not they are still traded. This is usually a very bad month for stocks with the fact that there are a lot of offers which is making people offload their stocks to get into ipos. Thats the reason for the fall of the prices in the market today, they will go back to their prices. Worst scenerio for dangflour 22 naira jan -march

I agree with you that the worse scenerio for Dangote flour is 22, I even predicted something higher than that. It may even be up to 30 due to sentiment. Don't forget that we are very few that have access to SMN forum. Others just listen to what their broker says and jump into the bandwagon effect.

[Yomik]

Originally Posted by Yusuf

I agree with you that the worse scenerio for Dangote flour is 22, I even predicted something higher than that. It may even be up to 30 due to sentiment. Don't forget that we are very few that have access to SMN forum. Others just listen to what their broker says and jump into the bandwagon effect.

You are right, some of us are going to buy no matter what; especially me. I have instructed my broker to buy me some, though I’m not going to buy up to what I should have bought. Let just cross our finger and hope for the best.

[bwalaman]

...until otherwise proven, what is good for Dangote is good for Nigeria...
Not talking short timers here...

[laman]

Dangote has tried. There are countless billionaires in Nigeria who would prefer to have their monies in "foreign safe Countries".THE MONIES STOLEN JUST BECOME NUMBERS IN ACCOUNTS ABROAD, SOME OF THEM UNACCOUNTED FOR AT THE TIME OF THEIR DEATH. How many of them have the average man benefitted from. At least he has made an effort to enrich people not use his money to create confusion, killings and hatred amongst the populace. He made a lot of people rich with dangsugar. This factor will have a great impact on the demand for his flour. Demand out strips supply.Marketing strategy perfectHow Simple economics. Nobody will sell dangote for less than 15 naira by the time it comes out. I reiterate lowest 22 naira which is 50%.Give me a stock for jan that you have more confidence, wendy wendy.

[Geeman]

Wendy's post is her opinion based on her analysis of Dangflour, which I think the forum has benefited from. We can take it of leave it. I had already committed huge resources to Dangflour before her post and I have no regrets at all. The post has nothing to do with the person of Dangote, whom I believe is an astute businessman- that no one can deny, but this does not stop us from analysing his companies and seeing how investing in them will affect our fortunes.

[wanaj0]

Originally Posted by windywendy

I haven't caused anything oh! It's dangote that's trying to sell us his lemons . . .

I believe DSR is a good buy at the current price. There was a thread on DSR in which I had an extensive discussion with another forum member, and I still believe in that company's prospects. Can't find the thread right now but if you can find it, it contains some interesting discussion.

Madam, well, I am the one you had the discussion about DSR with. Like I said then at 40.00, DSR is not attractive. However, at 31.00, DSR is very attractive.

[wanaj0]

Originally Posted by Geeman

Wendy's post is her opinion based on her analysis of Dangflour, which I think the forum has benefited from. We can take it of leave it. I had already committed huge resources to Dangflour before her post and I have no regrets at all. The post has nothing to do with the person of Dangote, whom I believe is an astute businessman- that no one can deny, but this does not stop us from analysing his companies and seeing how investing in them will affect our fortunes.

What Windy did was to place a Cautious BUY on Dangote Flour which is fair. She is concerned about the intracompany transactions and the feasibility of the projections (profit forecast). Those are valid fears/concerns. What an investor should do based on the concerns raised is to go back and challenge the figures.

Dangote flour is not attractive as at today even if the profit forecasts are met. However, going forward, there is a lot of value in the company especially the sack company.

[Kaching-o]

Originally Posted by windywendy

I thought the IPO closes sometime next week? In any case I only just got to look thru the prospectus late this week. I'm not saying that dangflour won't do well, it's just overvalued in my opinion and I'm not comfortable investing. Sentiments may however push the price up in the immediate term.

With regards to some stocks I think are undervalued, I'ld say Crusader (which I believe is easily a N10 stock at least) and Nig. German. Flour mills is also yet to incorporate the valuation of the cement business which fully comes onstream sometime next year. My investment timeframe is usually at least 12 months (most often 18 or more) unless the company's fundamentals change significantly and I have to sell. I could also sell if the stock becomes overvalued and/or if I see others with better upside potential. But companies with good fundamentals always pay better in the long run, because after all is said and done, fundamentals rule. For instance, CMB in Sept. 2005 was undergoing restructuring after being taken over by Nampak of S.A, and Nampak worldwide was at the time streamlining its business processes (just like cadbury is doing now), closing down some divisions and increasing investments in those ones that were considered profitable. CMB was one of those that were considered profitable, and indeed the company had good fundamentals and prospects coupled with a well experienced management team. I bought Nampak in sept. 2005 at N1.04, shortly after the old CMB was taken over and restructured by Nampak S.A and sold in less than 2yrs at about N9. Good deal if you ask me. If you can wait for about 24months, CADBURY is a fantastic buy. I've been accumulating that one for some time now. The parent company, which now has the majority ownership, is doing some great things and using the Nigeria company as a launching pad to the W.A market. It's one of those companies that requires little capital investment with high yields. Also, the old hands are gone and new and more experienced folks are at the helm of affairs. I could go on and on, but I gotta go now.

How did you find out about the potential restructuring of CMB in 05, and the plans for Cadbury as a jumping off point for W. Africa. Is there a specific source you have or is this just a case of putting ear to ground?
Quickly...whats ur take on Japaul? and "forgotten" stocks like Ashaka Cem, Okomu Palmoil ( new rubber factory, foriegn investment about 60%)?? I am looking for long term buys.
Thanks in advance

[mastro]

My take on Dangote flour is very simple
"Sentiment"

The most irrational basis for investing, because it can't be quantified, why did I buy DanSugar, looked at the figures, looked ok, however I happen to have been to Obajana Cement factory last year and knew that he intended floating it, I took the view then and nothing has changed that opinion that anything he floats before then is just a taster for the big one, therefore he will ensure that us, the unwashed masses retain a positive impression of him and his businesses till after then, the major way he can do that is by keeping share prices high, sentiment, my people can't be measured with a calculator.
Just my 5 kobo's worth

Oh and Dangote Sugar, returned >100% in a year (banked) my target for Flour is 50% which as a non professional trader is fine by me

[muyiwataiwo]

I stumbled on the this report from VETIVA stockbroker. I guess it is detailed /

http://www.vetiva.com/Dangote%20Flou...20Coverage.pdf

[Yusuf]

Originally Posted by muyiwataiwo

I stumbled on the this report from VETIVA stockbroker. I guess it is detailed /

http://www.vetiva.com/Dangote%20Flou...20Coverage.pdf

Good report. Thanks. Very detail