EPS based on the above net profits & number of shares sbould be 0.55 cts and not 0.01 cts.

On Tuesday, GFM Services Bhd (GFM:KLS) closed at 0.69, -10.97% below its 52-week high of 0.775, set on May 08, 2017.

https://klse.i3investor.com/blogs/fatprofitstock/2020-01-04-story-h1482030755-My_O_G_stocks_watchlist_for_6_1_2020.jsp

As oil prices shot higher after a U.S. airstrike killed a high-ranking Iranian military leader, which traders fearful of retaliatory attacks from Tehran on Middle Eastern energy infrastructure, we can expect these key O&G stocks would be potentially rallied next week: 

1st Liners: Producers, FPSO & Rigs:

1. Hibiscus

2. Reach Energy

3. Sapura Energy

4. Yinson

5. Bumi Armada

6. Velesto

2nd Liners: Maintenance & Fabrication:

1. Dayang

2. Petra Energy

3. Deleum

4. Wah Seong

3rd liners: OSV & Downstream maintenance

1. Alam Maritim 

2. Perdana 

3. Icon Offshore

4. GFM Services - via a newly proposed acquisition of Highbase Strategic Sdn Bhd (HSSB). The latter’s existing orderbook would be a major boost to GFM. Given HSSB’s orderbook of RM261.4 million for over 5 years and assuming conservative PAT margin of 7%, new additional revenue and PAT to GFM would be RM52.3 million and RM3.7 million per year from FY20. GFM's 9M19 and FY18 earnings stood at RM9.1 million and RM7.6 million respectively.

Additionally, the more O&G activities in town, the more HSSB’s downstream maintenance services are also needed. 

Demand for O&G plant turnaround is expected to be positive as plant turnarounds are scheduled periodically and is part of legislation compliance. With the secured contract of providing plant turnaround services for PIC in Johor, this gives HSSB the credibility to bid for similar type of projects in other areas.

The latter’s services are critical as it helps to prevent from undue interruption of its clients’ production performance and avoid damages to clients’ facilities. 

Technical wise, the stock has signaled a bullish reversal as the stock has been positive divergence with weekly MACD histogram, with high possibility to rally upon closing at and above 33sen. Inflow of money into the stock has been increasing as shown in the daily MFI chart, which means strong accumulation in anticipation of the rally ahead.

Recall that the Group has recently proposed the acquisition of approximately 49% stake in HSSB. Additionally, GFM has also entered into a call option agreement, which grants GFM the right to exercise the call option to acquire up to 2% in HSSB @ 51sen/share, which HSSB shall become a 51%-owned subsidiary of GFM upon conversion.

Lastly, "I always believe that the share price move first and fundamentals come second". In other words, it is better to react now on GFM before the actual results come out!

Tq, Fred

On Friday, Gfm Services Bhd (GFM:KLS) closed at 0.185, 208.33% above the 52 week low of 0.06 set on Mar 19, 2020. Support 180/170

Kajian Saham Picisan

On Tuesday, Gfm Services Bhd (GFM:KLS) closed at 0.17, 183.33% above the 52 week low of 0.06 set on Mar 19, 2020.

Kajian Saham Picisan

https://www.theedgemarkets.com/article/gfm-services-seeks-raise-rm1975-mil-private-placement%C2%A0
10% PP

Stock Review GFM

• GFM customer mostly are government or government link companies, political unstable might affect the revenue of GFM if their maintenance contract is not extended

• Has operating lease of RM 312,522,869 until 2035 for UiTM. Stable income  until 2035. Around RM 45,000,000 of 37.90 % of the 2020 revenue is secured until 2035.

• 10 % partnership for EPCC contract to build Solar System for 6 number UiTm campus. RM2,713 per kWp which is a reasonable price during the signature of contract however with current increasing and unstable cost of photovoltaic cells the price might be a bit tight. RM 3,000,000 to GFM is completely done

• Acquisition of 49 % in Highbase Strategy Sdn Bhd (HSSB) - O&G downstream company. RM 2,882,359 for 49 % of share. Projected value of HSSB contract until 2024 is RM 261,100,000 (estimated RM 102,351.20 - 0.8 safety factor)

• GFM had a call option to purchase 2 % of HSSB share at RM0.51 (49 % discount) until 31 July 2024. GFM management can exercise the option and make HSSB subsidiary of GFM when they think HSSB is profitable for the company

• GFM plans to subscript Rm 15 million to RM 20 million of RCPS with a fixed 6 % per annum.

• GFM proposal to acquired AMZASS (M) Sdn Bhd which had contract to upgrade existing plus highway north bound and south bound Benbam lay by in state of Malacca into rest area. However it had proposed three time. Latest Stop date is 30 September 2021. RM 500,000 deposit had been paid to AMZASS.

• ESOS and Warrant are out of money at the point of writing.

• GFM took out RM 317,530,520 (96 % of 2020 total debt) to support the concessionaire with UiTM which had operating lease of RM 312,522,869 until 2035

• GFM had positive flow in free cash flow while negative growth in price. The price did not growth with the company's free cash flow.