Forum Archive Index - October 2003

["Fiona Phibbs" <fibz@xtra.co.nz>]

Hi Philip

The float was a major flop for the public that's for sure, but using even
basic relative valuation techniques this should have been easily identified
as a fizzer.  It highlights the fundamental importance of separating the
company from its share price.  The company may go on to great things and I
hope that they do from a kiwi perspective, but the original public
subscribers may have to wait a while to see a positive return here!

Being a DPC shareholder I'm also concerned the damage the float may do to
the company, who were promoters of the issue.  In an earlier posting I
commented on the risk to the company of being an underwriter - but obviously
underestimated the gullibility of the public because the issue was fully
subscribed!  Sure DPC got their underwriter/promoters fee but must have done
some damage to their client bases through subsidiaries Direct Broking and
Equity Research, who would have been pushing the issue heavily to their
clients.  I don't know what management were thinking here, promoting the
shares on the terms that they did, perhaps they were in a time warp that
placed them back in 1986, or drinking too much of the clients product - who
knows!

I can't help but also comment on the sanity of the NZSX letting a company
list at an unrealistic valuation - it does a lot to promote the market to
the mum and dad investors who again get burnt.  A lesson to be learnt
perhaps - beware anyone that tells you to 'focus on the story' of a company.
In plain language this means  - we can't justify its valuation using any
other conventional means.

Cheers Dean


----- Original Message -----
From: <philip@goodreturns.co.nz>
To: <sharechat@sharechat.co.nz>
Sent: Friday, 17 October 2003 10:48
Subject: RE: [sharechat] Below 42


> Quite nice to see actually. I thought that people were going to go crazy
on
> this and bid it through the roof on hype. However it seems discussion
about
> the company on sites like this and in the media have made people truly
> understand the business.
> To me the whole issue had shades of the tech boom - lots of hype but
little
> substance.
> I'd be interested to hear how people who bought at 50c feel at the moment.
> Anyone brave enough to say they put money in?
> Philip
>
> -----Original Message-----
> From: sharechat-owner@sharechat.co.nz
> [mailto:sharechat-owner@sharechat.co.nz]On Behalf Of Mark Hubbard
> Sent: Friday, October 17, 2003 10:12 AM
> To: sharechat@sharechat.co.nz
> Subject: [sharechat] Below 42
>
> By the look of it, 42 Below is soon going to be below 32  (cents).
>
>
>
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