FEI (ASX) Most undervalued asx micro cap

Originally posted by Holdtight: ↑

As a heads up. I do own this stock and for over 3 years. Originally this was a back door listing for wolf strike from a mining coy prior to that. Both failed. I am sure there are plenty of shareholders from both adventures. If you held there is some great news on the horizon. I attended today egm and spoke to management in depth. This thread will likely get 10-15 views but lets post anyway!!! . The new management have turn this shell into a potential prospa, silverchef or flexigroup. BIG CALL i hear you say!!
WHY?
(1) FE investments are 2 or 130 coys to survive the GFC in NZ ( whilst a private coy). They had policies in place to avoid the wrong risk. To date they still have bad loans approx 1%. Brilliant
(2) They have grown the business prior to listing on retain earnings ( despite extravagant fee to founders, which have been removed since listing )
(3) The reason for listing was to access the capital markets to expand the business from NZ to Australia.
(4) The loan portfolio has be adjusted accordingly to accommodate RBNZ changes to property holdings.
(5) Funds have consistently been raised above the underlying trading price.
(6) As we stand the equity of the coy is $15m with $67m in loans plus $7m in cash less $59m in deposits... Currently at 9c the market cap is $16m
(7) Balloon loans from the business at over 20%p.a will result in $4m earn that are not accounted for in 24 months.
(8) The recent move into Australia has just commenced with an ASFL for "non-bank deposit taker"
(9) Given what the new management has done in NZ and the new tighter lending limits in Australia banks, the opportunity for FEI lending is massive and from these prices the downside for FEI is almost zero. PAC partners have valued the stock at 18c prior to the new AFSL.
(9) Oh I forget to mention leasetech. There new technology. I cant say its neobank like and cutting edge as I havent seen it but I am informed its a big step forward.
(10). Finally, the Aust environment for small business lending is perfect for this coy to move into. They dont do personal loans and they dont lose money...Keep an eye on the NPAT this year...I expect a big turn from -ve to positive. Just need more eyes on the stock.

Get in early and enjoy the ride.
IMHO and DYOR.

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Good insight.

To add to this though, one needs to consider the risk FEI has around past shareholder / (it could be that they are still holders) directors current interest in entities FEI have lent too (TOM would be a case in point). There is a handful of underperforming entities in the market place; that, if they fail (and having a look at some of the public information, they may well do so) will place FEI under pressure.

On balance, one needs to look a little deeper.