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Roosterman2000

389 Posts.

229

01/01/18

12:12

Post #: 29965592
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Originally posted by rolf2903 ↑

I’m trying to get a gauge on what could be possible over the next 12 months and beyond.
Assuming the 500k+ tins of formula was set expecting it to be achieved (highly likely you would think) then let’s say they can do 600k tins. That’s 14m in revenue at 51% which is $7m to jat for infant formula.
This year’s revenue (not including infant formula) was $10m, from a $1m prior year revenue line. Cleary they have worked out how to push product through these channels so you would expect a decent lift again this year (and presumably with much better margins, especially on the milk powder products that they are doing themselves under the cobbitt brand. So $10m maybe becomes $20m or more? Who knows. But that does seem conservative to me I think based on this years growth and the new milk powder products (and further experience pushing fmcg in China). So that would be $27m of revenue. Hard to estimate profit, but I’d hazard a guess the infant formula will deliver 30%+ margins so maybe $2m. The milk powder under cobbity will be decent margins, and you would expect stage 2 to produce generally much more acceptable margins on the $20m (non infant formula rev). So maybe another $3m-$4m? Really really rough numbers here obviously. But maybe $5m $6m profit from the $27m? Not sure what valuation that would put on the sp now though.
but a company that goes from 1m to $10m to $27m would start to attract a decent multiple.

All this gives me zero idea how to value it now on relist and therefore what price to consider. But it does tell me that if they get this right the upside becomes infinitely higher than my numbers suggest as they have the right people/connections.
Anyone else got any random thoughts on how a valuation might be applied to the company in the short term?

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Aren't Cobbitty also going to have infant formula CFDA soon? Whenever that happens that would be 100% profits to JAT so who knows how much that would bring in. I would expect that to be revenue in 2018. I suspect that Zhou will go hard to get 500,000 tins sold before June 2018 as well so he can take advantage of the lower share price for his shares.

A lot of guess work but if everything aligns I can see $1 well before the end of 2018.

JAT Price at posting: 7.0¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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