Gopeng (Net Cash Of rm0.61/share)

It is a Perak based cement player with a stake in Perak Hanjong Simen as its key asset. Its 35.2% stake in the cement company was sold for rm200 million cash to YTL Cement in 2010 and Gopeng has since turned into a cash rich company with a small plantation and property arms.

It has also diversified into other business such as quarrying, management of water treatment plants and manufacturing and sale of cement. Nonetheless, all of its revenue in 2013 was generated from palm oil.

The company revenue has been declining, from rm17.5 million in 2011 to rm10.2 million in 2013. Net profit in 2013 rose to 37% to rm3.6 million but was largely due to rm4.95 million in fair value gains from investment properties and short term investments.

The main attraction of Gopeng is not is not its plantation or properties assets, or its earnings which are unexciting. Indeed, its total plantation land bank is very small totaling just under 1000 ha and lack economies of scale.

Rather the key attraction is it is very strong cash rich balance sheet – a legacy from the disposal of its cement business – which perks up the potential for future corporate exercises or higher dividends.

As at June 2014, it had net cash of rm110 million as at June 30 2014 or rm0.61 per share. Its net cash is just slightly below current market cap of rm132 million (29 Oct 2014).
The stock is trading at 0.4 times its net asset value of rm1.64 with trailing 12 month PER of 63 times.