Amid the carnage
LOCAL JUNIOR MINERS – specifically coal stocks – have taken a real beating in the last few weeks as labour issues have sprung up and investors steer clear of any risk. Coal of Africa has gone on record saying that it is now placing its Mooiplaats operations under “care and maintenance” and looking at retrenching over 500 workers. This general negative sentiment has weighed on a lot of the miners and those supplying the sector, including Buildmax. After the recent share consolidation it was trading in a range between R2.25 and R2.50/share but as the news f low has turned negative, so has the share price and it has dropped below the R2/share mark.
TNAV per share is R2.84, which implies that you are buying the share at a 42% discount to its assets. Even with some creative accounting around its depreciation – as implied by some analysts – this is tempting.