What's to happen to Berjaya Land's Growth Story?

Previously I made the following blog entry: Berjaya Land Is A Growth Story?

I had questioned the growth story suggested.

I argued that....

• Now, let's look at Berjaya Land growth as stated.
  
  In 2005, it earned 67.5 million
  In 2006, it earned 89.1 million.
  In 2007, it earned 32.3 million! (hey... where's the growth????)
  
  Seriously. Won't that had been deemed as a DRASTIC decline in earnings???
  
  Anyway... here is the whopping growth...
  
  In 2008, Berjaya Land is FORECASTED to earn a whopping 497.2 million!
  In 2009, Berjaya Land is forecasted to earn only 212.5 million!

However in that news article, ECM Libra had their own reasoning.

• "Our recent visits with the management have left us coming away fairly optimistic of BLand's growth prospects," ECM Libra Avenue wrote in a note on last Thursday.
  
  Citing examples, the research house indicated a 33-sen annual rise in BLand's fully-diluted earnings per share by applying a 10 per cent net profit margin on its RM37.2 billion worth of property jobs in China, Thailand and Vietnam.
  
  This, in turn, translates into a RM3.7 billion net profit to be recognised over the next 10 years.

RM37.2 billion worth of potential property jobs.

Now this massive potential suffered a huge hit this morning when news article reported that Berjaya Land has made the following announcement.

• Berjaya Land aborts Vietnam project
  
  Published: 2008/01/25
  
  BERJAYA Land Bhd's plans of developing residential and commercial properties in Vietnam's Nhon Trach district has fallen through.
  
  In an announcement to Bursa Malaysia yesterday, Berjaya Land said it will not proceed with its co-development plans with Tin Nghia Co Ltd, a leading state-owned enterprise in Dong Nai.
  
  The property development is inclusive of its transportation and infrastructure network.
  
  "The board wishes to inform that after much discussion and consideration, the parties involved have decided not to proceed with the project based on the findings of the feasibility study report," Berjaya Land said.
  
  Berjaya Land had signed a memorandum of understanding in November 9, 2006 but the memorandum will now be mutually terminated by the related parties.

How?

Now with Berjaya Land aborting this Vietnam project, serious re-think is required in regards to it's whopping growth story as suggested by Berjaya Land.

Couple of issues.

One, the feasibility of a project, I keep wondering why such a study was made before Berjaya Land signed that MOU.

And lastly, MOU is MOU is just a MOU.

Btw. I had received an extremely interesting comment from PJ-investor in my initial posting on this issue:

• Know what? i notice ECM always exaggerate their reports. even after doing my calculations, i could'nt match theirs. THere are only 2 possiblities, either ECM people know something that we dont, or they simply miscalculate and exaggerate.Or, it could be that BERJAYA bosses tell them to write something ridiculous to push the stock higher then simply sell a lot at the top. i dont know...