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I put a comment on this thread over at TMF, you will see it as you move down through the replies.

http://boards.fool.co.uk/Message.asp?mid=11380292&sort=whole


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Write up of RCG over on TMF :

http://boards.fool.co.uk/Message.asp?mid=11382830


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Some RFID/Biometrics news from RCG :

http://www.rcg.tv/html/eng/about/newsroom/industry_news/rfid_news/2009_details_3.jsp

RFID for vehicle recharging stations
5 Jan 2009

A start-up company in California has recently introduced a network of vehicle electronic recharging stations within the region. Batteries of specific vehicles can be recharged in the stations when drivers are away from home garages. RFID cards are used in money rechargeable cards in the form of pay-as-you-go and monthly unlimited access subscriptions. Data transfer between the RFID card and the reader is encrypted to ensure data security during the transfer.

Vehicles will be parked at specific locations, where drivers hold their high-frequency RFID cards to the kiosks with the embedded RFID interrogators. Information collected will be transferred through GPRS to a centralized server which verifies the card information, and an authorization packet will be sent back for initiating charges. According to statistics, 20% of cars in the United States will be electric by 2012, representing a market potential for the widespread growth of the technology. Approximately 8 million charging states may be deployed by the company which uses RFID as means for secure payment.

Source: rfidjournal; RFID Is the Key to Electric Vehicle Recharging Stations (Nov 21st, 2008)

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http://www.rcg.tv/html/eng/about/newsroom/industry_news/rfid_news/2009_details_2.jsp

World's smallest active RFID tag announced in India
5 Jan 2009

According to a recent announcement, a company based in India has recently introduced an active RFID tag which claimed to be the smallest in the world at the moment after 18 months of research and development. It can be used for asset tagging including notebooks, servers and vehicles in industries including healthcare, manufacturing and IT etc.

Active RFID tags include an embedded battery for powering up signal transmission through the antenna, which is one of the barriers to developing smaller tags. The newly introduced tag has a reading range of 20 meters, with dimensions of 26 x 23 x 7.3 mm which is believed to be the smallest among the tags in the market. The active RFID tag has been deployed at a telecom company in India for asset management.

Source: RFIDnews; Indian Company claims 'world's smallest' active RFID tag (Nov 24th, 2008)

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http://www.rcg.tv/html/eng/about/newsroom/industry_news/biometrics/2009_details_3.jsp

Biometrics passport facility built in Malta
5 Jan 2009

According to a recent announcement, a factory facility has been purposely built for research, development and production of biometrics passport located in Malta. The factory was said to be the first site in the world for manufacturing biometrics / e-passports required by many countries for enhanced border security.

The facility occupied 2,600 square meters and has a capacity of producing 2 million biometrics passports annually, which could be expandable. The factory, which costs at EUR 6 million, is capable of manufacturing biometrics passport, which contains embedded chip storing digitalized facial image or fingerprint images for authenticating travellers and visitors.

Source: findbiometrics; World's first purpose-built 'epassport' factory opens in Malta (26th November, 2008)

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http://www.rcg.tv/html/eng/about/newsroom/industry_news/biometrics/2009_details_2.jsp

UK consumers preferred biometrics
5 Jan 2009

According to a recent research project on consumer's security concerns, consumers in the United Kingdom preferred biometrics and are most well-adapted to the technology throughout Europe. Statistics showed 75% of the UK consumers accept fingerprint as means for identity verification in banks and government agencies, compared to 63% in Italy, 62% in Germany and 59% in France.

The area receiving most concerns from the UK consumers was financial security, such as misuse of credit and debit cards - has been increasing throughout the last six months. In terms of iris recognition, 74% of the UK consumers were prepared of such means of verification, compared to 72% in the Netherlands, 48% in Germany and 45% in France. The survey showed a general preference of UK citizens towards biometrics technology compared to other parts of Europe, and the increasing concerns of identity theft and border security within the region.

Source: findbiometrics; Brits ready for biometrics to tackle ID fraud (November 25th, 2008)

Trading statement overdue?

Nothing can be released while the Hang Seng listing application consideration is in process.

A poster on another board has just been in contact with the CFO and asked some questions, here are the questions and replies :


Q*The RNS issued in November 2008 mentioned the listing may occur at the end of 2008 or first quarter 2009. Does the company still expect the listing to occur in this time frame?

The HK listing exercise is currently in progress and if it happens, it is expected to be in the 1st Quarter of 2009.

Q*Does the company intend to remain listed on the AIM market or perhaps gain a full London Stock Exchange listing?

Yes. RCG will be dual listed on both AIM and SEHK.

Q*January trading updates have been forthcoming during each year. Does the proposed HKex listing preclude the company from delivering such an update?

Due to the on-going listing exercise in HK, we are not expected to make any further statement other than what have already been made public to the market.

Proselenes Emailed the CFO and just received the same reply of HK listing 1st 1/4 09 from CFO

Comment from Chartist "Zak Mir" over at SC.


Zak Mir Reged: 28/06/07
Posts: 559

Re: RC Group (RCG) [Re: Proselenes]
#437178 - 09/01/09 09:12 AM

Technically, we need to see a weekly close above 2 month resistance at 39p - something which now does not look to be too difficult. The target would then be the 200 day moving average at 57p.

Absence of trading update makes it very difficult to assess the impact of the global recession on RCG's business.

From a poster on a different BB :



Q&A with CFO of RCG.

1. Has RCG received clearance from the listing body to list on the HKEx ?

The HK listing exercise is currently in progress.

2. Are RCG still planning to list on the HKEx ?

Yes. The plan is on-going.

3. Has a listing date been set yet?

We are expecting 1Q09.

4. Do you prefer to list before, at the same time, or after the announcement of the annual results?

The timing is not entirely within our control.

5. Once a listing date has been set, how far in advance do you plan to inform the markets?

Once a date has been firmed, well notify the market immediately.

6. Will RCG, or RCG's largest shareholders, be making any shares available as part of the listing process?

Unable to comment at this moment.

7. I have read the last announcement that trading is in line with market expectations. Would i be correct in summarising the market expectations as eps of 18-19p for 2008?

Market expectation is for a FY08 Turnover of round and about GBP132m*

* 43% revenue growth between 2007 and 2008

pp surprised you are still ramping RCG when your other blogs are so derrogatry towards chinese companies. When RCG has enough cash to pay shareholders a decent dividend then their shares may be worth something.

RCG is a great Malaysian company. Most of their business is Middle East / South East Asia.

Chinese exposure is small, but building now.

Cash, RCG have plenty of that, did you not read the interims ? However, they are a growing business and so will divert cash into growth.

Dividends are only required when the "growth stops" and you have nothing better to do with the cash.

RCG do pay a small Dividend, and put the rest of the cash to work growing the business.

Some Biometrics/RFID news updates on the RCG site :

http://www.rcg.tv/html/eng/about/newsroom/industry_news/biometrics/2009_details_5.jsp

Biometrics ID cards issued in Morocco
13 January 2009, 23:00:00
According to an announcement by the North African government,............


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http://www.rcg.tv/html/eng/about/newsroom/industry_news/biometrics/2009_details_4.jsp

UAE deploying biometrics to eliminate fraud
13 January 2009, 23:00:00
According to the UAE Ministry of Interior, an agreement has been reached with the UAE Central Bank and other banks.........

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http://www.rcg.tv/html/eng/about/newsroom/industry_news/rfid_news/2009_details_6.jsp

RFID for vehicle recharging stations
13 January 2009, 23:00:00
A cosmetics company has recently deployed RFID-enabled technology ........

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http://www.rcg.tv/html/eng/about/newsroom/industry_news/rfid_news/2009_details_4.jsp

Belgian hospitals adopting RFID
13 January 2009, 23:00:00
Two Belgian hospitals (St. Trudo and Jan Yperman) have recently adopted ........

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Hang Seng listing confirmed Feb 9th should see some movement now

Yes, once the shares are finally on the Hang Seng, and buyers come in, then the SP should start moving.

AIM is dead and not going to drive the price, however, given its very easy to transfer stock from AIM to Hang Seng, any demand in Hong Kong is going to really drive the AIM price upwards to maintain parity.

http://www.investegate.co.uk/Article.aspx?id=200901191100008525L


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Nice article over on TMF.

http://www.fool.co.uk/news/investing/2009/01/19/bag-an-aim-bear-bargain.aspx

Bag An AIM Bear Bargain By David Holding From the Fool blog

Published in Investing on 19 January 2009

This cash-rich small-cap is priced at two times possible earnings!

The good thing about a bear market is that it treats all companies the same.

Of course, that isn't completely true but a lot of companies with rock-solid balance sheets, exciting prospects and which haven't yet put a foot wrong, have seen their valuations trashed.

AIM-traded RCG Group (LSE: RCG) has a prospective and historic price-to-earnings ratio (PER) of under two -- with over half its entire valuation covered by cash and a net asset value of more than three times its market capitalisation. So the share price of 34.75p seems to be pricing in a heck of a lot of bad news despite the company giving no hint of any such news so far.

Value and excitement?

You could be forgiven for thinking that RCG operates in a staid, boring sector where there is pessimism over future earnings. But not a bit of it. The Hong Kong-based company has a wealth of intellectual property in fingerprint and facial-recognition technology, biometrics and RFID products, which use technology to track products and people as they move from one place to another. And its been growing like Topsy supplying these security products in South-east Asia, China and the Middle East.

The firm's broker has earnings per share (EPS) of 18.81p penciled in for this year, which would put the shares on a PER of a little under two - or less than one against enterprise value (market capitalisation minus cash)! And in the first half of 2008, the annualised basic EPS was 18.3p -- so it's not like the forecasts aren't grounded in reality. Of course, RCG certainly isn't immune to the downturn but during November, we were told that trading was in line with expectations as RCG felt confident enough to take a larger stake in Vast Base Technology Limited.

A wealth of research

This excellent write-up links to other discussions and a wealth of information; Motley Fool discussion board devotees are certainly no strangers to RCG, and the company has its own forum here.

RCG has given those on board a rough ride over the last couple of years as this chart shows, though seemingly through no fault of its own. Market sentiment and forced selling seem mainly to blame. In fact, RCG was considered to be strangely undervalued a little over a year ago at 85p as this write-up illustrates. A recovery to this "low rating" would reward investors buying in today two-and-a-half times over.

Concerns

That said, there are a few concerns. RCG's AIM status, its Far East headquarters and Bermudan registration are sufficient deterrent for some investors -- particularly institutions -- whilst the issue of who owns the shares left by the late Nina Yang hangs over the company. The background to this issue is well explained here. It could result in Tony Chan controlling over half the shares.

On the other hand, RCG has announced an update, today, on its plans to list on the Hong Kong stock exchange, which could well give the shares a boost. It is hoped that trading on the exchange will begin early next month.

All told, I think the shares are patently undervalued.

Disclosure: David owns shares in RCG Group

January 2009 Corporate Newsletter is out, link below, and it makes good reading.

http://www.rcg.tv/html/eng/about/newsletter/2009jan.jsp

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On a seperate note I have topped up again, originally got a load at circa 32p levels as posted before and now some additionals at 34p levels.

The case for RCG gets more compelling as sterling falls further, and its akin to being able to buy HK dollar earnings at knock down rates in sterling (for a few more weeks anyway)

RC Group is an Asia based company and is well known in Asia, particulary in Hong Kong.

The Hang Seng listing should see Hong Kong investors lapping up the so low PER of RCG and pushing the value of RCG stock up to anywhere even circa 15 times the HK dollar earnings (HKex average is circa 15 times)

As its very simple (read the web site) to swap stock over to sell on the Hang Seng from AIM and the other way around, the prices on AIM and Hang Seng will be matched to within couple of percent maximum.

There is a whole mass of companies on low PER's on AIM, however, they all suffer the same problem, low PER but also low liquidity. With no buyers around it makes no difference if you pump out PR (as WCC did today and it made no difference) or if you pump out results or anything else, simply there are no buyers on AIM and the low PER's are here to stay for a very long time.

So, what do you do ? Do you load up with little illiquid AIM stocks like WCC, TAIH, GNG and others, try to make yourself believe its a wise choice and will hedge against falling sterling value, but in your real heart of hearts you know that its so illiquid on AIM you have no chance of selling in quantity, and even with the very best news the lack of buyers and liquidty means the PER stays low until the next market bubble in.....well, how many years ? Are you really willing to potentially lock it up for 3 to 5 years with no chance of selling it unless you take a loss, should you need cash out of the market.

Or, do you pick a stock like RCG, which will soon, God willing, be dual listed on the Hang Seng and AIM, will be open to much more liquidity with lots of Hong Kong/China buyers buying in to such a low rated stock which is a "brand name" in the region. Liquidity is key to reratings, and if RCG were to remain just "AIM" then it would also remain "low rated" IMO, until the next "boom" in the economy.

However, everything changes in terms of liquidity when the Hang Seng listing goes live, and many Hong Kong stocks have done it before, and multibagged within a short time of listing. Hopefully, RCG will also join that list, although it may not happen overnight, it should happen withing a reasonably short period of time.

As ever DYOR ! and things might go wrong and the listing might not happen, but then, what happens if it does ? I am happy to have a lump exposed to RCG now at average of around 33p, and would seriously love to sell this, this year or next, at 15 times the Hong Kong Dollar earnings price equivalent in sterling pounds

The price should be driven solely by the Hong Kong Hang Seng index soon given AIM weakness, and that is the driver, the liquidity and the key to an AIM stock rerating, and hopefully this ones.

At a guess one should expect earnings to be around about 2.2 HK$ per share (and given the Hang Seng listing, and that the Hang Seng will drive the price once listed, AIM will just follow it).

With 2.2 HK$ of earnings, priced at the Hang Seng averagle multiple of times 15 you get circa 33 HK$ share price for RCG.

This equates to 3 pounds sterling a share.

During bubbles the Hang Seng can go to 30 or 40 times multiples of earnings, so 6 to 7 pounds a share.

Even so, and ignoring that, and falling back to a below average 10 times earnings (below the current average for the Hang Seng) you still get over 2 pounds a share.

Just keeping those fingers crossed that the listing goes ahead early February as planned.

Some good news, the Hong Kong Hang Seng listing looks approved.

http://www.investegate.co.uk/article.aspx?id=200902031200026861M

Plenty of information available as well too. Looks quite good.

SP went up well yesterday and today so far.

Roll on the HK listing, and a proper x 15 valuation, not x 2 before cash.