Posted by: donmihaihai | September 11, 2016

Jardine C & C

A Conglomerate within a conglomerate owning a conglomerate? Not true. JC&C is an investor within a conglomerate owning a conglomerate.

Invested in 50.1% of Astra International, 43.8% of Tunas Ridean, 27.1% of Truong Hai Auto, 22.7% of Refrigeration Electrical Engineering and 24.9% of Siam City Cement.

While REE is a mini conglomerate, Astra is as the AR says, a premier conglomerate with listed subsidiaries and associate such as Astra Otoparts, United Tractors, Astra Agro, Astra Graphia, Permata Bank & ACSET.

I say invested because these entities do not intergrade into Jardine. If I am correct, it stop at JC&C and Bintang level.

JC&C owned 50.1% of Astra International and consolidated Astra results. But JC&C doesn’t seem to be running or even leading Astra. Astra is still being run by Indon management. Regardless of what accounting say so, Astra is just an investment. It is the same for the others.

Which mean JC&C is an expensive “closed end fund” or “investment holding company”.

Having so many listed subsidiaries and Associates is making life easy with looking at JC&C. The only black box is Truong Hai Auto. The rest are a group of excellent companies mixed with few lousy ones. Jardine direct motor interests in Singapore and Malaysia are pretty good companies too.

More excellent than lousy, on average I think these companies can generate ROE of above 15%. 15% is what I would pay for an investment. Which mean no go for JC&C.

 

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