WriterThe core business I believe at this stage is Component...

Writer

The core business I believe at this stage is Component Homes where at 100% capacity they make $7 million per year profit (they can increase production by adding another shift). Production is rising quickly and at last count was at 60% ($4 million profit).

The factories in UAE and India offer the blue sky for me. I like the JV's because they are with established building companies and provide to a degree a ready made market for the products they produce. Competitors could come in but at least JVG would at a minimum get work through their JV partners. They have slated that they will be launching new products through both factories so that would also help them to get ahead of any compentition.

JVG use roll forming technology and specialist software so not sure how many competitors exist.

The steel framed housing in Jordan (and elsewhere) would be absolutely massive if anything came of it.

I'm not sure of the profit this FY because production has been growing so rapidly and there is a 3-4 month lag I believe for house payments. However, for next FY if they hit full current capacity that's $7 million, plus UAE factory (currently cash flow neutral moving to profitability) and India which is predicted to be profitable if they hit their targets of 100,000 door frames pa (1,000 a month in UAE is cash flow neutral). Add in any new products and other potential JV's (CSR and JVG are talking about manufacturing Cemitell (I think thats the name its a wall pannelling system).

Given the market cap of $14 million, and the fact you can leverage in with cheap oppies, and I have got word that management are very confident (also buying on market) then you would understand my enthusiasm...

Let me know what you think.