SG Talk

Sembcorp flags S$212m impairment for H1
Sembcorp Industries has flagged an impairment of S$212 million for its H1 2021 financial results, although it expects net profit will remain positive, the conglomerate said in a bourse filing on Monday.

In its profit guidance, Sembcorp said its 49 per cent-owned joint venture (JV) Chongqing Songzao Sembcorp Electric Power will likely record a net loss for the half-year ended June 30, and for the full year 2021.

The JV, which operates a coal-fired power plant in Chongqing, China, had to procure coal from other provinces, after its JV partner Chongqing Energy Investment Group closed all its Chongqing-based coal mines following a government directive in January for coal mines in Chongqing to re-evaluate their coal mine operations, the group said.

The asset had been hit with higher coal prices, due to low coal inventory in China amid restrictions on coal production combined with continued high demand, and uncertain and insufficient government support, the group added.

Sembcorp also expects the group will face competitive pressure from low carbon power sources in the longer term.

The conglomerate will be announcing its results for the half-year ended June 30 on Aug 6.

Shares of Sembcorp closed at S$2.09 on Friday, down S$0.01 or 0.5 per cent.

Jialat

Sembcorp invested in a sunset pollutive industry. Asking for it.

“The JV, which operates a coal-fired power plant in Chongqing, China, had to procure coal from other provinces, after its JV partner Chongqing Energy Investment Group closed all its Chongqing-based coal mines following a government directive in January for coal mines in Chongqing to re-evaluate their coal mine operations, the group said.”




Still sleeping in ivory tower. Still dont want to get out???

Sembcopr investment in China turn into lemon.
Sembcorp investment in India turns into a gem worth $1.8B.

What does it tell you?

Anyway short term reaction.

I bought earlier as its India assets looks good and likely to make up for losses in China.

Investment in China can become losses when the China local govt changes the rules.

In this case, Semcorp Industries invested in local coal power plant.
Then the local govt has ruled that no coal mining in local area.
No local coal, how to run coal power plant ? 

PAP Suzhou Industrial Park turned to losses when the China local govt set up another local industrial park to compete.

Your business contract needs to protect/compensate against changes by local govt.

Squeeze sinkees’s balls and pay for sinking China’s companies. Same as City Dev

If you have a joint military excercise with other nation against their national interest, you are already "stabbing" them.Dun forget you and many countrymen are heavily invested in the country.

(02-08-2021, 12:03 PM)forum456 Wrote: [ -> ]Investment in China can become losses when the China local govt changes the rules.


Your business contract needs to protect/compensate against changes by local govt.

Not only their govt change rules, you must also kowtow to them. If pinky step on their toes, Sg companies going to suffer, just like Jack Ma.

(02-08-2021, 01:53 PM)klat Wrote: [ -> ]Not only their govt change rules, you must also kowtow to them. If pinky step on their toes, Sg companies going to suffer, just like Jack Ma.

Learn to kowtow  well and you should do well.

It's like this since thousands of yrs ago.if you don't obey absolute ruler, you are lucky your head remains on your neck.

China is a dictatorship country....so what they are doing to these people is considered very nice already.