A lot of us look at the large cash holding and think that

• We have a value proposition there
• This cash holding can pay for many years  of dividends

Often we realize too late that  the reason for that cash holding there is to serve as working capital. It looks really good during the good operation times.

But when they are  facing some lukewarm long term or short term operational issues, or cyclical  down times, they can turn rather fast.

Nam Lee press metals was at a rather good valuation not too long ago.

It has a current market cap of SGD 77 mil but it was trading as high as SGD 89 mil.

Its cash holding 1 year ago was 52 mil and no debts.

The enterprise value works out to be 37 mil.

The appeal is that Nam Lee have a low PE or EV/EBITDA indicating value.

It ...