A Kick in the Groin...

I wrote the earlier post on Welli-Multi Corporation (WMC) less than 24 hours ago; praising it to high heaven.

Look what a difference a day makes. On opening bell, it lost 18 sen to RM1.30 and from thence, WMC went down 44 sen (sei-sei!) to RM1.04. Finding its bottom, it rebounded to RM1.19. The dumping of WMC shares was an expected reaction to the SC sanction. Good buying opportunity.

Do you think the worse is over? What has Moore Stephens, the newly appointed auditors discover that is not pleasing to the eyes of SC? SC apparently needs more time to authenticate trade receivables of RM113 million out of the total of RM135 million of WMC and to explore the propensity of its recoverability. So, they will be getting together with WMC shortly to pore over the accounts to safeguard shareholders' interests. The new CEO has also indicated that all trade receivables owing to WMC will be collected by March 2008 or else these parties will be hauled to court! So we will leave SC to do its job.

Meanwhile, let us look at the speed WMC is moving on with its gelatine project. I believe the new management is giving the highest priority since its is a flagship World Halal Hub project of Malaysia for the OIC and the entire Muslim world to see. Nothing must go wrong as far as the Malaysian authorities are concerned. Licences will be given by fiat by MITI,MIDA and JAKIM. Also the banks will be lining up to the door of WMC to give loans to it. Being associated with the project will be most important especially for Bank Pembangunan and CIMB.

There is no doubt that the expert machine fabricator from China will be taking a stake in WMC. I think the price of RM4.00 for a meaningful stake is credible. WMC is definitely being taken over by powerful parties. From the looks of it, crystal ball gazing, WMC will most likely undergo a name change to reflect its new business in agro-technology in time.

Do not for a moment think that Hadhari Cattle Industry cannot take over WMC via a share swap and then restructure the capital to involve even Khazanah and the EPF. It certainly can especially with the new no-nonsense management team which I believe is mission and market driven. Bearing unforseen circumstances, the project will come on stream.

I will stick my guns out for WMC and still sing my praises until such time it loses its lustre.

Heartsong