Barakah - Can you make profit of 40% or more from this stock?
Barakah is RTO company just list on Bursa on 6 Nov 2013, for details of the company, just refer to below Maybank Research:
http://research.maybank-ib.com/pdf/document/Barakah_Petroleum_IC_20131101_MKE_5275.pdf
Right now, the share price is around RM1.00, in the best case scenario, as per above research, they give the target price as RM1.40. (I think RM1.20 is reasonable).
Since the stock already jump up from 60 cents to RM1.00, investor might have missed the boat. However, there's a RCULS (Barakah LA) which now trade at around 62 cents. This RCULS can convert into Barakah share at 1:1 after one year (next year 2014 Nov). If 2014 the stock price for Barakah remain at RM1.00, investor can convert RCULS to Barakah stock and make a profit of at least 40% for one year. If Barakah stock price trade at RM1.20, then investor can make profit of about 100% for one year.
The risk is, what happen if Barakah stock price drop by 40% next year? (This will only happen if their profit drop by 20% or more, which is very rare case) If really Barakah stock drop to 62 cents on 2014 Nov, then investor who invest the RCULS can just sell the Barakah stock and take back 62 cents. Investor will lost money if Barakah stock price fall below 62 cents, again, the percentage for this to happen is very slim)
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p/s: On 22 Nov 2013, this Barakah-LA now close at $1.20, investor already make more than 40% in less than one month!
http://research.maybank-ib.com/pdf/document/Barakah_Petroleum_IC_20131101_MKE_5275.pdf
Right now, the share price is around RM1.00, in the best case scenario, as per above research, they give the target price as RM1.40. (I think RM1.20 is reasonable).
Since the stock already jump up from 60 cents to RM1.00, investor might have missed the boat. However, there's a RCULS (Barakah LA) which now trade at around 62 cents. This RCULS can convert into Barakah share at 1:1 after one year (next year 2014 Nov). If 2014 the stock price for Barakah remain at RM1.00, investor can convert RCULS to Barakah stock and make a profit of at least 40% for one year. If Barakah stock price trade at RM1.20, then investor can make profit of about 100% for one year.
The risk is, what happen if Barakah stock price drop by 40% next year? (This will only happen if their profit drop by 20% or more, which is very rare case) If really Barakah stock drop to 62 cents on 2014 Nov, then investor who invest the RCULS can just sell the Barakah stock and take back 62 cents. Investor will lost money if Barakah stock price fall below 62 cents, again, the percentage for this to happen is very slim)
.
p/s: On 22 Nov 2013, this Barakah-LA now close at $1.20, investor already make more than 40% in less than one month!
Hi Tang, Baraka is very attractive.But no experience in stock so dare not comment much...will consider this stock, thanks.
ReplyDeleteBarakah RCULS these 2 days already move up more than 20%, means many people know how to value the stock!
ReplyDeleteVincent, today the price already 1.32. really great share
ReplyDelete