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买复原能力强的股票/冷眼

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 There has been a few sand mining projects announced by listed companies. However, if you know the industry a bit better, you will surmise that not all projects are the same. Some may be resting on a lot of IFs; some may be poorly funded; some may have dubious buyer partners; some haven't even got the necessary permits along the whole logistics chain of production and delivery.

Let's not look into why most of the other projects aren't as "desirable". Let's focus on the Vivocom's announcement of RM3.8bn sand mining project. It has a firm contract signed with Zhen Hua CC, a joint venture company which has been tasked to undertake the construction of the third HK airport/runway. This is important as its a DIRECT supply contract with the main contractor. Too many "projects" have been flying around town that has agents upon brokers upon license holders etc...

The export buying side safe and secured. Looking at the supply and lock partners. It has signed with Malaysian Energistik Solutions Sdn Bhd a firm contract for them to extract and supply sand. MESSB is also an approved permit holder to export sand. The approval has been obtained on 7 October 2019 from the Sabah government. The export license is quite critical and a key license requirement to do sand export. Many have seen "delays" and further waiting period upon further verification ... just to get the license.

It also appears that the site to be dredged and mined has been identified and secured, which is in Sandakan. Logistics wise it more tenable and viable as it is much closer logistically to China. Hence West Malaysian operators have a disadvantage here. The other quibble is that sand mining is more impactful on the environment for those located in the Peninsula for obvious reasons, just ask the Penang state government.

As mentioned in the first paragraph, not all sand mining projects are equal. You can just go along the logistical chain of supply till export and noter the various licenses required. Then there is the issue of capital, experience and approved permits. Then there is the "buyer's credibility". Securing the site is another critical factor. 

All in, looking at Vivocom's project, it appears to have ticked all the right boxes.


p/s This is an opinion piece and not a call to buy or sell. Please contact your dealer/remisier before acting, and always do your own research.



http://malaysiafinance.blogspot.com/2021/02/golden-sands-or-sandpaper.html

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