KTL Global

KTL Global: hit a 3-yr high of $0.152 yesterday, and chaled up a 32% return ytd. The Edge notes that for a company that is barely profitable and whose fortunes are tied to oil prices , which have not stopped falling since 2Q14, the rally may seem excessive, even if the company has been buying back shares. KTL , which supplies steel wire ropes to the O&M and construction sectors, said this wk it had taken a 30% stake in a company partly owned by its CEO Tan Kheng Yeow, whose father is KTL's executive chairman. Their private invmt vehicle owns ~55% of KTL. KTL paid a nominal $1 for FW Coastal (FWC), which provides training and certification for skilled workers for the O&G industry, and is involved in eqpt rental. As part of the deal, KTL gave FWC a three-yr loan of $1.5m, despite the latter's lack of track record. FWC stared business only in 2012, and is loss making. It is interesting therefore to see what KTL can achieve from this invmt. Meanwhile, mgt expects KTL's business to remain challenging for the next few quarters.