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Re: andrewflying post# 107409

Friday, 12/02/2016 8:00:29 PM

Friday, December 02, 2016 8:00:29 PM

Post# of 163716

So the gain is 9% of Triway, but we lose one third of the other part of SIAF



That is not correct either.

The 18% results in a divi of $6/share. But we have to share it with more shareholders so it's $4 instead of $6. The cost is $2.

What remains is a 19% stake versus a 51% stake.

The 51% stake fetches an EPS of $3.35 in 2019. Multiplied by a P/E of 25 gives $84.

The 19% stake fetches an EPS of $1.81 in 2019. Multiplied by a P/E of 25 gives $45.

The difference, $39. Minus the cost of $2 leaves a $37 gain.
The difference will grow year after year as the Mega Farm grows from 60k MT to 300k MT. 5-fold. So instead of $39, the difference could be $195 ten to fifteen years from now.

On top of that, you get to consolidate assets and revenue, which makes it much easier to tell the story and get fair value.

Would you sacrify 1/3rd of the rest of the business for that? I definitely think so. There are no guarantees that beef will be profitable or grow much. The plantation probably won't grow, but we know the Mega Farm will.

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