Gupta’s Oakbay is melting
If you think you’ve had a tough start to the year, spare a thought for the Gupta family.
President Jacob Zuma’s unofficial first family has been all over the news, culminating in xenophobic threats from the freedom fighter in chief, Julius Malema that they must “leave the country” and how SA isn’t for sale for “a plate of curry”.
And it’s been just as bad for them on the JSE, with the Gupta-owned Oakbay Resources having shed two-thirds of its value in just the first few weeks of this year.
Of course, before you start imagining that this is somehow a well-considered reaction to the flak they’re getting in the media, or perhaps even someone’s savvy strategy of shorting nuclear stocks, we should point out that the price has fallen based on less than R100,000 worth of trades.
Last year, Oakbay’s “value” had soared to an immense R24bn, based on a similarly small number of trades. So the fact its value has now fallen to just R8bn is probably something you should overlook just as easily.
Considering it made a R38m bottom-line loss last year, after reporting operating profit of R23m, it’s difficult to assess the actual value in the company.
But ignoring the political noise (of which there is, admittedly, a whole cacophony right now), Oakbay is a company that could do well providing sentiment shifts back to uranium stocks.
And it won’t hurt if government keeps on pushing for the nuclear power option.