Noble Group’s Cliffhanger

Tyler Durden's picture

Submitted by Noble Group Research

Noble Group’s Cliffhanger

2010:  Harry Banga split… most of Noble problems start here.1

2015:  Noble Group, one of the biggest traders of commodities from coal to iron ore is melting from its base.

Script writers have devised the solution of telling us a story but leaving it at a cliffhanger, thus forcing the market to postpone their execution to hear the rest of the tale.

A villain was designed and a lawsuit with an injunction was filed with the Hong Kong High Court asking to ban his research, hoping to ensure the audience will return to see how the characters would resolve the dilemma.

Behind the scenes, the legally aggressive stance of Noble Group Ltd is rapidly becoming known in the financial analysts’ community as analysts and media organizations are threatened one after another by the troubled SGX-listed trader.

The censorship and its lawyers used to claim full control of the situation with the hope that its critics and the market would be “reset”—akin to being lobotomized.

The company has left us with its cliffhanger: even the most egregious comments made by Iceberg on the trader happened to be entirely correct.

“The Hong Kong High Court has recently ordered that Noble pays a substantial amount of money to Iceberg after an unreasonable application made by Noble was once again rejected by the Court”.

The futility of Noble’s claims has been remarkable.

“For example, Noble has defended that Yancoal was not overstated (although it was valued 48 times its market value)  and that saying otherwise would be defamation.” 2

It has not paid off.

Plainly, it’s Iceberg who was right.

Noble Group, the SGX listed trader is insolvent based on liquidation value (a write-off of its commodity contracts or the asset value).

Noble recorded $465m negative OCF in full year 2015, stressing it generates positive cash flow in the second part of the year ($580m after interest) but has never given any detail on how the short hedges supporting this cash generation in Q3 and Q4...

Noble has never turned the page on 2015…

Its Management has a ludicrous coal forward projectio , pricing 60 to 70% above the current curve (and with a deteriorating coal market outlook).

Neither, Noble Group or its public relation firms have enjoyed huge credence or the control of the script lately, and one can fully expect them to be irrational until they either blow up or magically emerge unscathed…

We are prognosticating the likelihood of the former.

Using the same adjusted financials used by financial institutions and rating agencies, we can see who is without trunks as the sea ebbs. The time clock is running.

We are now entering May, with things becoming more loose: why is Noble so late in securing financing?

1. “Back with a Banga”, South China Morning Post

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HedgeAccordingly's picture

Dreyfus same deal. They are all hurting.

DownWithYogaPants's picture

Hummm Maybe I stand a chance with Julia Louis Dreyfus if she gets pimped out.  I always dug Elaine.

philipat's picture

Marc Rich & Co has gone awfully quiet recently also?

Dragon HAwk's picture

Hey if your business is failing can't you just buy a bunch of derivatives in the opposite direction and reset, Reality ?

arrogantsuisse's picture

 I wonder how a Bank Analyst implying -45% maintains a HOLD on this company only in Asia...



Make_Mine_A_Double's picture

Just for shits and giggles I loaded up on GlencoreXstrata at the nadir. I didn't base it on anything other it was cheap and that Glassenberg & his Zugg mafia would have some serious splain' to do to some of their more...ummmm...'well connected and weaponized investors'

It's the best performer in my little portfolio.

Now Noble I got a bad feeling about.

GotGalt's picture

Noble, been awhile since I heard anything about their troubles. JCB should do the same as ECB and agree to buy up unlimited amounts of corporate debt in order to back door a bail out to Noble similar to Glencore.

UncleChopChop's picture

friend of mine who doesn't have a lot of exposure to distressed asked me to take a look at noble for him a few months ago, as he was being faced with having to buy some to track his high yield index. i couldnt believe how much fraud is going on here. well, i could believe it - but it's been a while since i've seen it so egregiously.

iceberg guys are bang on. real thoughtful analysis. at the end of the day, my thinking is that if there WERENT massive fraud, they would have ALREADY opened up their books to ANYONE... as all they would need is for ONE person with a half-way decent reputation to say 'yeah, its ok.' then they wouldnt need to do massive refinancings, or assets sales, etc.etc. etc. problems would be solved in one afternoon. the fact that that hasnt happened tells me these guys are googling 'how to change your identity' and 'move your stolen cash to an untrackable domicile' for when the knock comes on their door and they start looking for their go-bag.


Big Stapler's picture
Big Stapler (not verified) May 1, 2016 7:35 PM

Based on this post, I don't know if Nobel Group is evil or good or some point in between...

...but whomever scribbled this "article" seriously needs to learn how to write. And they need to hire an editor with a LOT of patience

ReallySparky's picture

So critical, search the site. Several articles about this last fall. Be kind, the Tyler's are down a man and trying to keep us updated.

arrogantsuisse's picture


"Only in Asia"

Analyst has a TP of -40% lower but keeps HOLD recommendation.