Rasmala Share Discussion Threads

[hugepants] 12/5/2017 11:11

I asked TD Direct if they trade Dubai stocks and they were non-committal. My impression is they'd probably find a way if pressed. Either that or surely some other broker could do it. Dubai isn't one of the major markets but I'm pretty sure there is more liquidity than for a delisted stock.

[skyship] 12/5/2017 08:10

RJM - IF they remain on AIM then I would be with you; however you have to admit that it reads as though they are already committed to Dubai - just awaiting final permits.

Effectively RMA would be delisted; so a very dangerous play IMO.

[rjmahan] 07/5/2017 22:46

They could but arent proposing that.

I have no idea whether Dubai listing would lower discount... They are slowly bleeding money.

[russman] 06/5/2017 09:53

The market discount to net asset value would widen considerably if the share price fell by the same amount as the distribution.
It is considerable already.
Can they increase the share buybacks aswell.

[hugepants] 03/5/2017 22:14

Having said that on AIM the shares have been valued at about 35% of NAV. Who knows but maybe if listed in Dubai they'd be valued much higher.

[rjmahan] 03/5/2017 18:37

I would also - but I think we get a vote before any delisting if things are done properly and they need 75%

[hugepants] 03/5/2017 13:26

So how easy is it to trade stocks listed in Dubai from UK? eg. I don't think TD Direct cover the Dubai exchange. I'd prefer they remained listed in London.

[rjmahan] 28/4/2017 20:12

I have bought a touch more here - if they do return capital I dont think price will fall as much as distribution implies.

[hugepants] 28/4/2017 08:28

Final results out. Just had a quick look but they seem quite poor with NAV down to 295p and NTAV down to 242p. Most of the tangible assets are cash or marketable securities/financial assets.

The good news is they are planning to return cash;
"We anticipate shareholder distributions of approximately £20 million in 2017."

That's 65p per share. They are also considering the AIM listing.

[russman] 24/4/2017 12:29

Have I got my maths right.They paid $6m for a seventh.Continuing ops were $2.6m last year.Clear as mud.

[hugepants] 21/4/2017 23:08

Agree not clear at all! This is the subsidiary with about a $1 billion under management. I can't see anything on page 93 but there is some info on pages 73-74 which does not reconcile with the profits stated and the net assets don't make sense either. The amount paid though does seem to be at a similar level to previous purchases eg. early 2012 when they first started buying a stake in Rasmala Holdings.

[rjmahan] 21/4/2017 17:01

Very odd - the holding as a negative NAV (P93 of 2015 accounts). It earnt roughly a million last year. Value implies the full holding worth 40m - or 33m before aquisition.

Still lots held outside this level.

Dont know exactly what has done on - could be being subtly robbed and unaware of it - not enough detail in the RNS for my liking...

Doesnt change the case so will continue holding.

[hugepants] 21/4/2017 10:08

any views on this announcement?

[hugepants] 11/4/2017 19:32

Quite.

CJohn you are not wrong.It's odd with the markets at record highs to see this still trading at such a huge discount to NAV.

Remember this from last years results? They obviously considered some "short term measures to support the share price" but didn't much like them.

"...We have developed a unique platform which is well positioned to grow and expand. However, we believe the current share price materially undervalues the Group and whilst confidence in our strategy and the building up of a track record is essential to create long-term value, we are considering short-term measures to support the share price..."

[russman] 11/4/2017 09:40

If RMA updated their shareholders more often; it may get more noticed.

[cjohn] 10/4/2017 10:37

Well, isn't it the case that deep value shares often remain deep for some time, then when things start moving they move quickly.

I don't doubt you've had that experience.

[hugepants] 06/4/2017 21:23

Still looking dead here Jim but should get the final results this month.

[hugepants] 15/2/2017 22:35

I make RMA's net tangible asset value to be 271p if DiamondCorp written down to zero. It's been suspended for months so no big surprise. However its not that clear how they were valuing this holding. Was it based on the share price or its realisable value? If realisable value it would maybe have had a nominal book value given its illiquidity.

[wexboy] 30/1/2017 03:04

Rasmala (RMA:LN) (3.0%):

Share Price: GBP 110p

Market Cap: GBP 33 Million

Rasmala was a ghost in 2016…the business made no discernible progress, nor did the shares. Which is all the more frustrating, noting the oil price soared, the AIM Index clocked a 14%+ return, and even (some) deep-value micro-caps rallied significantly. Longer-term, the legacy private equity portfolio remains unsold, AUM is unchanged for over 3 years now, and after 5 years at the helm CEO Zak Hydari is still nowhere close to delivering a sustainable return on equity. Even successful activism – relinquishment of the banking licence, a £20 million tender offer, a share buyback approval (albeit management hasn’t acted on it since) – has been ignored by investors.

But it’s priced accordingly: Eliminating the equity stake in Diamondcorp (DCP:LN), which looks touch & go here, RMA trades on a 0.35 Price/Book multiple. For a company which operates near break-even & has a relatively low-risk/un-levered/hedged balance sheet, that’s a dirt-cheap valuation. But alas, a valuation which may not change significantly ’til we see a significant corporate event – whether it’s another tender offer (we’d probably need to see management do the buyback first), or some kind of merger/takeover. Though the appearance of Somers Ltd., who have steadily built a 8.1% stake to date, may well prove a potential catalyst. While it’s still one of their smaller holdings, Somers has a history of constructive activism – we can expect them to push for value enhancement/realisation here too.

Opportunities for a deal with another Somers portfolio holding might appear limited (though Bermuda Commercial Bank could perhaps approach Rasmala as a potential balance sheet transaction/expansion), so finding a buyer or initiating a formal sale seems a more likely bet. [And Somers wouldn’t have much trouble attracting support from other disgruntled investors!]. And noting another relationship that’s been developing recently (here & here), Ajman Bank (AJMANBAN:UH) is perhaps a candidate – though in a formal sale, other bidders could pop out of the woodwork (SHUAA Capital (SHUAA:UH), for example?). Like most special situations, earning a decent (annualised) return here will inevitably depend on how long it might take for value to be realised – and so, time is the enemy here…

For this & other top picks, check/Google my latest 'Top Trumps For 2017...' post on the Wexboy investment blog.

[cjohn] 28/1/2017 16:21

Patience is certainly required.

[hugepants] 26/1/2017 20:02

Decent rise today on hardly any volume. Maybe Somers still buying. Either that or they've bought all the loose stock.

[hugepants] 24/1/2017 22:47

Somers have increased from 7% to 8%.


Didn't realise Somers were 50% owned by Utilico (UTL). Gives them a bit more credibility. In fact Somers is their biggest investment

[hugepants] 05/1/2017 20:18

Some comment on Rasmala from blogger Wexboy.



Rasmala (RMA:LN): (1)% Loss, (0.1)% Portfolio Return.

The loss is immaterial, but the +14.3% AIM Index gain’s a reminder of the opportunity cost here. Rasmala’s problem has been a negligent return on equity (RoE), with little chance an over-capitalised balance sheet would yield a decent RoE (even if the original operating/AUM targets were met). I also assumed an oil bear market (in the last few years) was irrelevant, as shariah fund management appeared to be a secular growth story, but with the operational disappointments here that became yet another negative influence on a neglected stock. Noting the fundamentals (NAV & AUM essentially unchanged for 3 years now), I assumed a 0.6-0.8 P/B trading range, which was clearly wrong…I never anticipated a 0.2-0.4 P/B range as a new normal here. A major corporate event (takeover, or liquidation) is inevitably required to realise shareholder value, so time remains the enemy…


I think that's fair comment although worth notng the company has returned a significant amount of cash in 2015 at 280 per share. They also said the shares are "materially undervalued" so they have at least tried to close the discount.

One of the problems with RMA is the spread. Ask price is 105p and the sell price appears to be 95.25p. Anyone buying this is immediately sitting on a 10% paper loss.

[rjmahan] 31/12/2016 22:31

Thinking of adding more too...

[hugepants] 30/12/2016 16:32

Quite.

Rob Mahan's portfolio made 33% profit in 2016.


He has RMA has his largest position. Mine also.