DEMCO's wind project is taking off.
DEMCO, a short update due to a press release which is bullish.
At the link below you can read about Demco's (2.82) new wind project (they are the key contractor, not the operator), as was just published in the Nation Newspaper today.
What is surely incredible here in this news article is that they state its all "together a 10 Bill. Baht project", this so far more then I was told initially. The Wind Energy Holding company says “it will require a combined investment of tens of billions of baht and…. Details of the projects will be unveiled soon.” This is impressive and likely so as the reporter quotes the sources.
Reportedly yesterday, the company signed a contract to award the construction work of more projects to Demco. And DEMCO, as they call it a “construction company”, earlier won a Bt1.3-billion contract for the plant in Phetchabun. As there reported, construction work on the plant will start late this year.
Here is the significant added news to what I was told just recently:
“Pradej Kitti-itsaranon, managing director of Demco, expects the construction work under the new contract to start in mid-2010 and the value of the contract should exceed Bt10 billion. The contract covers projects to generate 600MW-700MW and will require an investment of between Bt40 billion and Bt50 billion", he said.
"Demco will be the co-developer and contractor of the projects, in charge of land clearing, wind-turbine installation, power-plant construction and the transmission grid. The value of the three-year contract is expected to exceed Bt10 billion," Pradej said.
This so is very bullish for next year as we were previously told this is a 1.3 Bill Baht project. Now its becoming clear that there is much more behind it. I can see DEMCO earning a Billion baht of this wind project over the next 2-3 years and so one day, on the anticipation of this, say next year, it should be a 5-7 Baht stock. Unlike some other companies we know, DEMCO has a good history on paying stock dividends, issue free warrants and has an above average IR. I have been visiting them regularly for 3 years now and like the people there. So far this year the stock has disappointed us, but this is about to end in my view.
Here is that article from today:
http://www.nationmultimedia.com/2009/08/07/business/business_30109344.php
Here is an earlier article on that same topic from Feb 20 ’09:
http://demco.listedcompany.com/newsroom/20-02-2009_TheNation.pdf
And here is my just previous article on DEMCO, posted on July 22:
/index.php?module=Pagesetter&func=viewpub&tid=1&pid=959
Since this article the stock price is up a about 12%.
Here is DEMCO’ IR web site:
http://demco.listedcompany.com/
Year to date, along with upcoming the 2 Q to be reported, DEMCO’s earnings have been on the down slope, for all the reasons I already explained in previous articles and member forum postings. And don’t’ expext any improvement on the 2 Q. to be released next week.
The exciting thing with DEMCO is its very likely strong earnings recovery late in year ’09 in’10 and '11. As now more then ever in the past, and after some delays, the mega wind project is finaly taking off and DEMCO will realize huge gains on that for some years to come.
Members should patient with DEMCO, look at like a longer term investment, not a stock trade,...and one day you all will likely thank me on this now strongly into next year earnings recovering small cap. If it sells off a bit on a market correction or on the release of poor 2 Q earnings, I would rate it a strong long term buy. Yes, I much like DEMCO at prices below 3, now even more so based on this news. Here is a new green company about to get noticed.
COMPANY PROFILE: Demco Public Company Limited operates 5 core businesses; 1) Design, Construction and Contract all kinds of Electrical Engineering works such as Transmission line, Substation, 2) Mechanic and Electrical System, 3) Energy Conservation, 4) Telecommunications 5. Fabrication and Distribution of Steel Structure for Transmission Line, and Billboard Signs. The company was established on June 1st, 1992 and became listed in the Stock market on December 14th, 2006 with its registered capital of 402,286,100 Million Baht of which 302,350,462 Million Baht was paid capital. The company is under the management of senior-level engineers with over 20 years of experiences....
Best Regards,
Paul A. Renaud.
