TSM sitting on a heap of cash

The country’s largest manufacturer and supplier of wire harnesses for vehicles by sales, TSM or Juan Kuang as formerly known in the market, is sitting on a heap of cash of 91.7 mln and virtually gearing free. This will translates into 1.72 per share. But, TSM was traded at 1.00 on Friday.

In FY2008 ended July 31, TSM reported a net profit of 14.67 mln, which is an increase of more than 100% from the corresponding period last year.

Analyst says the cash in its coffer will allow TSM to be resilience to the financial crisis and give ample opportunities to invest.

But, the charts show buyers have very little interest in this counter. Volumes were mostly below 20,000 shares per day except on 7/11. There was an accumulation of 170,000 in that particular day. As such, it explains that there might be some insiders’ accumulation before the publicity of this analysis.

The immediate resistance is 1.02, it is advised that punters should only step in after it broke this barrier with volume. Next on the list are 1.07 and 1.10. Whether or not price will shoot higher than 1.10 will very much depend on volumes. Volume depicts the strength of support. Its downside support is 0.97.