Asia Pacific Wire & Cable Corporation Limited [NASDAQ: APWC] was a top performer in yesterday’s session and looks set for more gains short-term. While it has eased up in pre-market trading, the overall momentum remains bullish. Traders are taking profits after a 96% rally, but the company’s fundamentals are overall strong. This follows a recent announcement that the company had acquired a loan that it would use to boost its operations.
During a recent stockholders meeting, the company announced that it had also procured a US $ 6,000,000 from its majority shareholders. It is a straight loan that carries a 3% interest rate and is secured by a pledge of the ownership of a stake in Sigma Cable Company Limited.
Loan to Boost Company’s Project
This loan comes at a good time when the company has secured business projects that need running capital. The Asia Pacific Wire plans to aim to fund capital expenditures as well as allocate working capital funds to subsidiaries that will undertake their projects in this region. This funding will be on a needs basis depending on the subsidiaries’ ability to run their sub-contracts. Further, the company will also set aside some funds to run some corporate affairs. Some of the projects that are currently on the pipeline are the acquisition of a new warehouse in Australia, acquisition of new machinery and other equipment, as well as the execution of a $200 million supply, delivery, and installation (SDI) projects in Singapore. This project was awarded to Sigma Cable last year. This loan will significantly boost the company’s growth and developments putting it in a better position to acquire even bigger projects come next year and improve on its service delivery. As its intrinsic value grows, so will its stock value to reflect the improving fundamentals.
About Asia Pacific & Cable Corporation
Asia Pacific Wire & Cable Corporation is one of the leading manufacturers of cable and wire products for the telecommunication industry in the Asia Pacific region. It mainly supplies these products in Thailand, where it has its headquarters, Singapore, and China. The company deals with copper and fiber optic, enameled wire as well as power cables. It has its own manufacturing plants where manufacturing takes place as well as its own distribution mechanism. Furthermore, it also distributes wires and cables from Pacific Electric Wire & Cable Company which is its main shareholder in Taiwan. In addition to manufacturing and distribution, the company also provides installation and other engineering services to most of its customers.