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TBF its not JPM conservatism as far as I know, its just the ridiculous closing value of the ADRs so the "official" mark just before they got suspended - but yes ONCE they reopen and remark to respective levels will be a big move just to get to FV and would imagine people finally notice this.... fingers crossed...
If JPM’s ultra-conservatism does prove to be unfounded (among other things), and one day we do see a sharp increase in the reported NAV, it will be interesting to see how quickly buying drives the SP up towards the re-stated NAV. Should get most of the way, fairly quickly
Yes agree, the NAV is posted based on liquidation potential as it is what could be guaranteed. I understand why JPM are being super conservative here but either the current NAV or the NAV if selling restrictions weren't in place could be considered false to an extent. They should post both.
So i've been pouring over this for days, thinking surely must have missed something - completely agree with FV of 450 purely on where the actual underlying equities are on MOEX right now (ie not ADRs etc). Even if you look at the holdings (on bloomberg) it has the largest holding of 15.21% in Gazprom ADR but then it reports the Current Market Value of this at 5.01mm versus Reported Value of 47.79mm which reflects the fact that the OGZD LI was suspended at 0.58 from 8 so down 92% but then actual Gazprom is currently down ~25% from "pre" ... Once the ADRs get remarked this will revalue at >400 without anything else on truce / political scenario ??
Was due to be today, now open ended until sanctions on clear pay system lifted, basically when the war ends and the moex won't actually have a reason to dive. Awful the situation in Ukraine but the Russians have handled the financial fallout very well.
4% now
Moex up 2% odd
Mysteriously Russian government bonds and corporate bonds were left off the sanctions list
He’s talking rubbish …….fact Financial Times 10th March JPMorgan &Goldman Sachs say we are withdrawing from Russian market. ……fact Wall Street Journal 30th March. vulture funds buying up Russian government bonds, and corporate bonds. Wall Street journal goes on to name JPMorgan & Goldmans as the main buyers. It reckons they will profit by 100%+. Also State department officials have said sanctions are not meant to be permanent and will be part of any peace agreement.
https://am.jpmorgan.com/content/dam/jpm-am-aem/emea/gb/en/regulatory/annual-report/ar-jpmorgan-russian-securities-plc-2021.pdf
A couple of thoughts and observations in case they may be of interest:
- the trust's 10 year financial record on page 27 of the above pdf is a great read. The NAV per share has really perfomed (before the invasion), as has the trust's revenue from dividends. Like clockwork a very high proportion of revenue per share is paid out in dividends. Market value of assets held is volatile, with Crimea annexation, covid and now being lows.
- investment managers seem to do a decent job and costs seem acceptable.
- the companies invested in by the trust are big, cash generative and seem to have excellent long term earnings power. Yes, they will all have a very tough time from sanctions and war (probably losses and no dividends for a while), but no way will they all cease to exist. Buyers for energy will be found. Sberbank will continue its near monopoly etc
- who knows where the SP is going in next week or month. Certainly not me.
- for anyone not invested during March, we now seem to have a truly incredible entry point. War-wise, it seems more likely than not that within some months, things will begin to normalise. Putin doesn't seem to want a fight with Nato, nor does he seem likely to want another post-soviet imperialist adventure any time soon.
- when normalising happens, the tide will turn and we'll begin a climb from 145p.
- imagine the gains if one day (let's say 2027) the trust makes a new all time high and divis are back above 35p a share. You got in below 150p. You do the maths. it's worth having and could happen, as it did post crimean invasion and post covid.
- risk of getting caught up in further SP decline, seems outweighed by long term possibilty.
- trying to time entry for lower price has risk of being late for the boat.
-even imagine a Russia minus Putin, that's friendly to outside world and shares export profits for the good of the country and its people. Its companies (like those held by JRS) and economy would have a bonanza. These lows might be that historic opportunity that so rarely comes along.
- if SP does down in next weeks/months, good, simply buy more.
- if things are going great in some years, and we start reading about russian troops amassing on borders, we know what to do with JRS holdings.
If jrs was actually liquidated, it would only happen after a peace deal was signed and sanctions were lifted. There would then be a huge return for anybody who buys jrs shares now.
Hello, Manfor, I was just wondering where you had pulled this quotation from?
“The sanctions that have decimated its NAV aren’t going away soon. Russia has been kicked out of emerging markets indices and that isn’t going to change for a long time either. “Then there’s the embarrassment factor of being invested in a murderous regime – that can only change if Putin goes. I think the board was wrong to recommend that shareholders vote in favour of continuation and the asset manager will want to disassociate itself from it before too long (as two of its directors already have). Its days are numbered.”
Sat on the sidelines all week, with the rouble recovring its Pre-Ukraine invasion levels, this looks a fantastic opportunity.
If nothing drastically changes overnight im giving this a go.
GLA DYOR
Manor, I'm invested in poly too, you state there going to zero as well, looks like I'm doomed...
You posted on poly, 28/3/22
The risk of appropriation by Putin here is far too high. If this happens then there is a very high probability that these shares will go to zero by the end of this year.
T w a t
manfor if you think that roubles can't be converted please just stick to investments like Bitcoin. Even today I can buy rubles as travel money....
Manor...
What's your motivation, do you feel you have a moral duty to tell me this information or would you like me to sell my shares so that you can buy them at a lower price?
“even if the shares are sold and assuming they are sold in an orderly fasion over months at a reasonable price, there would be rubles worth around 450p plus the non russian assets valued at 40p, the rubles would be owned by the fund, so the fund would retain that value, holders of jrs would effectively own this value regardless of where they are held and in which bank i would think. The rubles could then be used to buy up shares in kazak or other nearby companies listed on russian exchanges in rubles i would imagine. “
And how would an investor ever get there money out in dollars or euros or pounds? The roubles cannot be converted, so what use are they unless you are willing to live the rest of your life in Russia?
manfor do you know the meaning of a free market? It means that me and other people can put the money where we want. It means as well you can stay out. So please save your comments in relation if this ETF should be or not open.
“The sanctions that have decimated its NAV aren’t going away soon. Russia has been kicked out of emerging markets indices and that isn’t going to change for a long time either. “Then there’s the embarrassment factor of being invested in a murderous regime – that can only change if Putin goes. I think the board was wrong to recommend that shareholders vote in favour of continuation and the asset manager will want to disassociate itself from it before too long (as two of its directors already have). Its days are numbered.”
The article basically says exactly the same thing that I said. It says that the manager JP Morgan will not want to continue with this toxic Russian vehicle for much longer, and so it’s days are numbered. They are saying that it will soon be liquidated. The shares will then be worth zero.
Gazprom bank is currently unsanctioned, took this from the BBC app just now...
Vladimir Putin has outlined a pathway for the cutting off gas supplies to Europe, if Western customers refuse to pay for supplies in the Russian currency the rouble.
However, the market reaction suggests the details of the mechanism, means that, in practice, European customers will just have to change their currency dealers to Gazprombank. That bank has already been left unsanctioned, for the purpose of continuity of energy trade.
Threatening to switch off gas to Europe unless its paid for in rubles via Gazprombank. Interested to see what consequences it has for the peace process and us, short and longer term. Not least since Gazprom and Gazprombank are JRS holdings.
https://www.dailymail.co.uk/news/article-10672659/Putin-threatens-turn-Europes-gas-supplies-TOMORROW-countries-refuse-pay-roubles.html
fossil why are you even here then?
i suppose theres always political and other risks.......
https://www.youtube.com/watch?v=H1PogORIVds
thats the strange thing, if theres an assumption moex will come down, it would need to more than halve from current level to reflect jrs at 150p. lots of moex shares have gone up since it opened this week, i dont think this can be demand from people covering shorts if they thought the prices would fall from 1st April, but ibnstead genuine reasonable valuations. I reckon jrs might go up a lot over coming months, possibly from tommorow, unless theres a perceived risk that funds or assets will be taken, but that doesnt seem to be the case. Even for duel listed shares on lse and moex they are less than half the price on lse in some cases, this could result in downward pressure on moex ones as funds could sell and buy the lse equivalents for long term, but there must be some doing that already who have access to both markets, and this could increase the prices of duel listed ones on lse. Have you seen the difference in price for polymetal on moex and lse, its pretty extreme at 969rub at gbprub of 109 equates to about 875p, compared to 320p on lse...