Abaci's Common Sense Investing

OOIL announced today that it had proceeded to initial completion of the disposal of the 4 North American ports. The Vancouver part of the deal was done while the NY part is still pending approval from the Port Authority. This means OOIL is certain to receive HK$14.66b out of the HK$18.33b total considertaion. Since the deal in terms of consideration is now 80% completed, it's time to re-run the valuation formula we had last time.

Valuation of OOIL shipping business: 30.6b - 14.66b cash - NY ports 0.38b* - remaining ports 1.98b - properties 9.5b = only 4b!!!

* conservatively restated at 1.5x p/b assuming no completion.

The updated figures of CSCL and China COSCO (shipping business) was HK$14.4b and HK$12.7b respectively.

China COSCO has risen some 20% due mostly to the A-share hype so it's no longer a sector bargain, which now goes to OOIL which is now about 30% cheaper than its peers.

My sector preference now is OOIL -> China COSCO -> CSCL. Keep in mind the revived industry prospect is not yet reflected. The shipping plays should still have a long way to go.

DISCLOSURE: I hold 1919 and 316 at time of writing.