Excellent posts paramazing. I also look at the company’s actions...

Excellent posts paramazing.

I also look at the company’s actions rather than what they say. With TFC it is actively increasing its holdings of plantations by increasing plantings and buying back pre 2007 MIS growers. In addition, it is capturing the full supply chain from soil to oil. If management – who understand the industry far better than me – consider the risk / reward is not justified it would focus on earning fees to manage other peoples’ plantations (MIS retail growers, sophisticated investors etc).

Furthermore, the CEO who owns $70 to $80m worth of stock purchased $1.5m more stock in late Feb. Either he has false confidence in TFC, the sandalwood market and his management or TFC is an exceptional investment opportunity.

I cannot forecast the future. But I can identify a manager that has an excellent track record to date. The CEO has taken this company from a germ of an idea to developing the plantations, learning from tree mortality, improving survival rates, increasing acreage, surviving the GFC, surviving the loss of confidence in MIS, purchasing Mt Romance, establishing supply contracts, and possibly developing a pharmaceutical market for sandalwood oil. I believe a good manager in the past is more likely to be a good manager in the future.

Consequently, I am very comfortable being significantly overweight TFC in my superfund and have started to build a position in my main portfolio. I am also a 2008 MIS grower.