Organization

CEEI is in what we call the "Enigma Network". When the investment in Luen Wong (8217) was announced, Webb-site called it a bubble stock trading on a P/B of 321 and a P/E of 861. CEEI said the deal was "fair and reasonable", "a good investment opportunity" and "an attractive investment which will provide satisfactory return". It subsequently crashed, of course. We pointed out the breach of the Listing Rules, for which the company and its directors have now been criticised by the Listing Committee. There was no criticism of the bullish statements made by the CEEI board about Luen Wong.

The average sale price was $0.97. The shares represented 36.9% of JM's net assets at 31-Mar-2017, when the market price was $19.00.

Proceeds were $18.66m, or $1.046 per share. CEEI bought the shares on 20-Jul-2016 at an average $6.977 per share. At the time, CEEI said that Luen Wong was "a good investment opportunity" and "an attractive investment which will provide satisfactory return". As we said at the time, the Price/Book ratio was 321 and the P/E was 861. How could any reasonable board make such statements?

Sometimes, all you need to tell a story is a picture.

What it doesn't say: CEEI has breached Listing Rules by failing to obtain shareholders' approval in advance of Major Transactions and by failing to announce them for 4 weeks. Each stock is the subject of SFC concentration warnings. We calculate that the purchase of Luen Wong shares is at a P/B of 321 and a P/E of 861. CEEI says the deal is "fair and reasonable", "a good investment opportunity" and "an attractive investment which will provide satisfactory return".