Welli is well on its way….

From a small-time food and beverage company doing an assortment of mumbo-jumbo trading activities, Welli-Multi Corporation Berhad (WMB) is on its way to become a new goliath in the Malaysian industrial and corporate landscape. Taking over the former Four Seasons listing, WMB is slowly being transformed, beginning 2008 into an integrated agro-industry player specialising in animal farming, animal feed, plantation and gelatin manufacturing in line with the country’s re-emphasis in agriculture chiefly in the value-added sector. On top of that, it has position itself well to be able to play a big role in the government’s World Halal Hub project.

The new Board members are well connected, in almost every way; and can bring their respective forte to nurture WMB into a global player particularly to serve the OIC countries.

The feverish trading of WMB shares from 21 May 2007 onwards is an indicator of the kind of rumours driving up and driving own the counter. There is immense speculation in the market on just who exactly is behind WMB. The shares shot up in price from a low of 88 sen to RM3.32 before falling like a stone to RM 1.79 on 14 June for a 73 sen loss in a single day.

It is trading today at RM1.48, a good bargain price. However, the SC's direction to Welli not to release its latest annual report may put a dampener on its price tomorrow. Be that as it may, the new management is continuing its quest to rebrand WMC as the world's largest halal gelatine producer. They have just signed an MOU with Erawat, an Indian machinery supplier in the gelatine capsule business.

In 6 month’s time, the gelatine plant should get off the drawing board and financing will be needed to put up the plant. Let us see how resourceful WMB is in getting finance without affecting its internal cash flow. They have said that Bank Pembangunan and CIMB are just awaiting details before they offer loans to them. Hope they are right. We know for a fact that no money will be spent in the strategic alliance with Hadhari Cattle. However for the Hagecap halal gelatin capsule buy-in, it will use internal resources. I believe Hadhari Cattle will take a stake in the newly WMB. It is a matter of time.

WMB is the counter to watch out for in the 9MP. It is that new darling that you have been waiting for. The counter would surely move upwards after all the annual account of 2005 and 2006 have been externally auditied to the satisfaction of the SC.

Heartsong