How to avoid Value Traps by Equity Tracker

1.Conglomerate business - sop vluation.
Exp: $DRBHCOM / 1619 (DRB-HICOM BERHAD)
-always much higher than share price.
-no conglomerate trade at sop value.
-only when breakout or restructuring to unlock its true value by SOP.

2. Property companies
-How much discount compare to net asset value.
-Compare share price with Revalued net asset value - bcoz value the land bank of what company have and compare with current share price - will project value of the land bank of current price of future price.
-All properties trade at discount at RNAV. The only difference is how big the diff is。
-big company like Mah Sing is about 30% discount.
-Only $SPSETIA / 8664 (S P SETIA BERHAD) trade premium at NAV - is becoz they build really good quality executive.

3. Legacy company - a company that exited for quite a long time but still run by family themselves.
Exp: 1.Selangor Properties $SPB / 1783 (SELANGOR PROPERTIES BERHAD) . - 1 landbank in Damansara is much more than whole market cap.
- they no intention to unlock the company value. Not aggressive to develop the land bank they have. - privatised at quite undervalued price.$GPP / 03029 (GPP RESOURCES BERHAD)
2.Oriental Holdings $ORIENT / 4006 (ORIENTAL HOLDINGS BERHAD) - same like Selangor.

4.company that hold a lot of cash but dun utilise it for exp expand their business or rewarding shareholders - no plan for the cash.

5.Plantation Company - the earning for plantation is slow and thus they make the landbank into propeties segment to earn more fast money. But this is just one off earning and there is no continuous earning for that landbank.

6. NTA can value a company?- Only liquidating basis only gt use and depend on the asset u means. If a lot of NTA ismachinery u need to give a lot of discount. This is because machinery wont worth a lot during liquidation. Benjamin's analysis only atribute 20% of the value to he machinery during liquidation.
For banks u can use P/B bcoz their NTA is cash and this is close to that.