11 Jun 2010 No Comments
The effects of the last 2008 recession was felt a bit late in the Mauritian stock exchange: the lowest point came about Feb-March 2009. Now we hear of the recent Euro Crisis and the market went down a bit last week… already?
A bit too quick. Naiades shares that has risen from Rs 26 to 28 went back to 25.5 (it’s back to 26.x now); Air Mauritius went down from 14 to 13 and is still going down. So are a few other companies. Will this trend persist? I think it will be temporary. It’s not the big financial crisis that coming again. It’s too early, if you base upon Robert Allen’s theory of cyclic markets (I know he might not be an authority, but his words make sense)…
I’ll persist with almost the same list of companies I recommended last time: SBM, NRL (it has good cashflow and is underpriced: other resorts groups are about 2x their NAV), AIRM (when it has gone down a lot – anyway, it’s underpriced), GIDC, Omnicane (these two are long term). The Shell, GCL and Rogers remain solid companies but let’s wait for a fall. If you bought MCFI and BAIN (as in the previous list) it’s time to sell.
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