99L (ASX) Ann: Becoming a substantial holder

Originally posted by Gwaihir ↑

I should qualify my statement. I still find these companies interesting, because on any metric they appear to offer excellent value, but it's not realised thus far because of some unusual factors, including the share structure. This may change, and like I've said before, I'm not sure how this will play out in the end.

I think the Hong Kong and Nasdaq exchanges may have frowned upon the share structure when NNW went searching for alternative listings last year. Not sure of the reason, but it all collapsed. My impression is, rightly or wrongly, that the ASX, and maybe Singapore, were the only exchanges that allowed such concentrations of ownership in a supposedly public company.

ENC is another example of an ASX Chinese listed entity by the Australian InvestorLink group. Liquidity is a problem there too. And they are also making good profits after tax, something like A$8 million, but nobody is buying, similar to NNW.

ECG chose a different path. They kept private ownership of the Logistics business, where they make all the money, and sat a publicly listed channeling business on top of it, that fed work through to the Logistics. It seems a much more understandable design.

I still think NNW is a good buy at these prices.

Anyway, it's all very interesting, and I'm happy to exchange ideas on this topic.

Gw

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Hi Gw
Thanks for sharing your thought / views. Owning these shares can sometimes feel like death by a thousand needles! Hopefully the recent nnw takeover will lead to some ideas on how they can increase their margins across the entire registered users. I understand there is some work being undertaken to validate the registered user base which should increase credibility. The false promises of an overseas float have certainly dented confidence in the stock, and management really need to focus on delivering a revised structure that can be understood and 'bought into'. Where it will all end up - who knows; I refuse to believe the lack of communication on some of the important issues is an indication nothing is happening, and therefore hold out that many investors who trusted in the IPO, forecasts, overseas listing, unusual structure will see brighter days. Really is no point I feel in getting out at what appears to be a ridiculously low price for this company.