Replies to post #147934 on Sino Agro Food Inc (fka SIAF)

[Handlamera]

Valueinvestor
I guess all agree to that a P/E of 10-12 is on the low side.

What is your guess for a growing company on the HK exchange?

[ks1977]

The numbers below would not equal necessarly equal the market price

Yes - and no. The value reported here is the appraisal value, to which they used profits (in 2016) and a PE of 10-12 (hence the confusion and discussion with RD earlier today). So again the question boils down to what PE we should expect (as well as what the net income will be)

what makes you think the P/E of 10-12 is the appropriate number for the company? There is a lot of uncertainties to come up with that conclusion

The PE of 10-12 is the value used by the appraisal firm, but for sure is a number one should discuss. There are several factors here; management (expect a lower PE if TRW don't get a different management than SIAF), interest rate (expect a lower PE if interest rates go up, which they will in the short term and possibly in the long term as well), growth (PE of 10-12 would be way too low if TRW is able to demonstrate decent growth also for the 2-3 years till listing), market place (HKSE vs OTC for instance) and so on.

Assuming that TRW is able to continue a nice growth and also not suffering too much turbulance of its net income, then a PE of 10-12 would be very conservative in my opinion.

What long-term goal (PPS-wise) have you set for your investment in SIAF and TRW?

[snow]

Value There is always a lot of uncertainty regarding the future. Several top analysts prove to have been totally cluless about the profit/loss of TSLA even after the quarter was over. TRW has not been in business for long and there are of course a lot of uncertainty about what the future will bring. I suppose we can agree that a p/e ratio of about 10 does not suggest more than a modest growth ratio when it comes to profits. A p/e ratio in this situation has to be fairly arbitrary. A ratio between 15 and 20 after listing seems very realistic to me.