Utilico Emerging Markets Share Discussion Threads

[kenmitch] 14/7/2017 22:36

Thanks vacendak and davebowler for very useful posts. UEMS still looking good. Spread at 34.5p - 35p exceptionally tight for a sub share. And still at a discount.

[vacendak] 14/7/2017 09:09

UEM June factsheet out.


Romania is paying a lot in dividend apparently.
Switch to Latin America confirmed (as per earlier reports from the links posted by DaveBowler).

[robow] 13/7/2017 15:40

thanks for that db

[vacendak] 07/7/2017 09:40

Edison report on UEM:


An earlier one I mentioned on the UIL Ltd thread is from Stockdale:

Stockdale is not really independent in this case, Somers Ltd. has a stake in Stockdale; both Somers and UEM are managed by ICM.

[vacendak] 25/6/2017 20:30

Something I got from the ICM website after receiving an email notification.
This is just the scan of an article about UEM deciding to remain invested in Brazil and ignore the problems of the Brazilian president.

[kenmitch] 21/6/2017 16:35

Trustee route is risky. But for the most recent two, SLES and VNHW it was MUCH better than selling in market ahead of expiry. Trustee got almost 3 times the VNHW sell price ahead of expiry- $0.146 against $0.05 sell price. And they exercised at $2.15 so their expenses low. AND trustee worked as well as exercising, and exercising except for the rich was too expensive anyway.

Also good point from davebowler. Great if that gives UEM further lift!

[hiddendepths] 21/6/2017 12:52

Thanks kenmitch - I have no intention of converting them early! It's just that time is running short on the subs. Interesting about VNHW - I had missed that and assumed that the trustees always get a bad deal! I don't think I'd risk it though. I'll just keep the UEM long term as I really like the concept.

[kenmitch] 20/6/2017 16:13

hidden depths.

Best not to convert them yet. UEMS will continue to go up much faster than the share. You'll lose that faster upside. E.g.possibly another 100% gain for UEMS if a measly 10% share price gain!

e.g UEM 225p just now and UEMS 34p. If share can get to 250p (up another 10%)by next Feb UEMS then worth 67p (100% higher than now). Then you can best decide whether then to convert or just sell UEMS in the market ahead of expiry if price near to 67p, and if not then let them lapse and hope trustee gets a good price. The trustee worked very well forVNHW recently.

[getscenic] 19/6/2017 14:58

Good Point Dave.

[davebowler] 19/6/2017 14:05

Charles Jillings makes the point that the increased capitalisation following the UEMS swap will be enough to to put UEM into the FTSE 250. THIS WILL HAVE THE EFFECT OF INCREASING DEMAND FROM TRACKERS.

[vacendak] 19/6/2017 10:08

The annual report reads well indeed, the beginning is upbeat anyway, I will get to read the rest tonight.

[hiddendepths] 19/6/2017 10:00

Very happy with this holding!

I have the UEMS with every intention of paying up to convert them shortly.

[kenmitch] 23/5/2017 16:08

UEM gentle rise continuing. Now 223p to sell and up from 195p at start of year. Share had been in an uptrend all year.

UEMS still lagging. UEMS is worth 40p (exercise price is 183p) and despite 15% gain today can still be bought for just 32p. Most of the UEMS trades today are sells. Unless thinking the share is not going up any further the sells make no sense, as UEMS remains such a bargain. With options/warrants/sub shares, investors expect to pay a premium (for the time value left) and not to be offered UEMS at a big discount.

Prices targets already covered in post 87. Another 10% or so on the share price to 250p looks reachable if bull market continues and as shown above UEMS should just about double from current 32p if it gets there.

[kenmitch] 27/4/2017 14:32

@contact

Further points on top of those from vacendak.

1. Don't buy only enough UEMS you can afford to exercise IF you think the share is going higher. Buy more and then just sell the UEMS you don't want to exercise ahead of expiry date. Or (as explained) let the ones you can't afford to exercise lapse and hope the trustee gets a better price than available ahead of expiry in the market.

2. Also if exercising but not then wanting to hold the shares, sell the share straight away at the market price next March and pocket the difference between the share price then (250p with a fair wind) and the 183p exercise price.

3.. Be clear that the current sub share price is way too low. It should be at least 34p.

UEMS negatives?

A bear market ahead and Emerging Markets taking a hit. Then just cut the loss on UEMS. But it is easier selling on an up day for the share. Can be difficult to sell a sub share at a decent price well inside the spread on a down day.

fwiw I reckon high chance of share price gains continuing, and perhaps a bit more than 10%. Then UEMS would be worth 67p with share at 250p, but if discount continues and widens further best to assume UEMS around 60p with share at 250p, if selling in the market and not exercising.

[vacendak] 27/4/2017 12:14

@contact

Having converted some of my UEMS at the latest call, I can say:

Your total cost per share at subscription/conversion will be:
28p (cost of your warrant) + dealing charges to buy the warrants + 183p (conversion cost).

In essence the company pays the cost of the conversion, so you pony-up only 183p per share.

An extra added bonus is that you pay your dealing charges, stamp duty, etc. only on the UEMS, which is technically cheaper than buying UEM, as they represent a % of the deal. Sure, it may not be much, but every penny counts. :)

[contact2fsnetcouk] 27/4/2017 11:57

Ken,

Thank you for the explanation.

If I buy UEMS at say 28p and exercise them on maturity, will I have to pay 1.80 in which case the share have cost me £2.08 or, will I pay £1.52 (exercise price less 28p)

Thank you

[kenmitch] 26/4/2017 19:45

contact.

Yes it DOES matter when you buy UEMS IF the share price rises between now and expiry next Feb.

Buy UEMS now at 28p with share at 217p OR buy later when share is with luck around 250p. THEN If buying UEMS you'll have to pay around 60p. i.e UEMS will have doubled and you will not only be paying double current UEMS buy price if waiting but will also have missed the chance to SELL your UEMS for a double too!

Remember you don't have to exercise UEMS. You can buy and sell UEMS at any time just as you can with shares. And you can also exercise some and sell the rest of your UEMS.
And you also have the option of letting UEMS lapse. I.e don't sell them when they expire as a trustee is appointed to exercise any UEMS allowed to lapse and the proceeds are then sent to your account with no dealing costs within a week or two. There are risks leaving it to the trustee.

UEMS are still fantastic value at 28p and well worth buying IF confident the share price is going to rise. One reason they are so cheap is because very few understand Warrants and sub shares and so few trade them. With the share at 217p UEMS are worth 34p so 28p is a barmy too low price.

[contact2fsnetcouk] 26/4/2017 13:15

Ken,

You mention -

If UEM can go up a boring 10-15% or so over the next year, then UEMS is likely to go up 80%- to a bit over 100%. Hence my view that it is unwise exercising except at expiry time.

In my simple mind, surely providing the UEM price is rising, it does not matter when you buy the UEMS because you are paying £1.83 to exercise?

thank you