RE: Uncomfortable15 Jan 2019 11:22
I suppose there are two ways of looking at everything..
Directors being involved in another venture in the region given their contacts, would itself be nothing unusal nd we see examples of this across AIM
However, I do agree that the proximity and early stage of cashew processing plan may rise questions over the willingness of those directors to invest / secure finance to progress this alone. Taking the previous company md year announcements in context, it is clear that whilst outlining the challenges faced by the maco economic market conditions in Palm oil they also point to a poor harvest. That said, as a processer not a producer per se' ,the business makes margins, albeit volumes clearly matter.
The cashew side has been sold to us by the chairman as being potentially highly profitable. I have no reason to doubt that there is value in the diversification strategy. It certainly makes sense to hedge the bets against the current negative sentiment to PMO. The proof is this pudding will no doubt play out over the next few months. If the short term revenue and margins allow the diversification without dilution (in any form) we are onto a winner, if not then i think the SP will tank.. This is, I suppose a binary play but i am as reassured as i can be that the odds are in our favour given the major drive by the local government to make the most of their agricultural resources and attract investment etc etc.... The ethical business model is also a good indication of a quality operation. Just my humble opinion but i do value other points of view and you both raise very valid concerns .
regards DJ
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