I happen to chance upon these 3 companies. This is something they have in common. In the past 5-8 years, they grow very fast and became big company. But something is not right. Their cash balance to long term debt is like 1:5. For example, Ezra has a cash balance of $100 Million and a long term debt of $600 Million. KS Energy has cash balance of $40 Million and a long term debt of $200 Million. Wilmar has $1 Billion in cash and $3 Billion in long term debt. This is what we called a weak balance sheet.
For example, how can a teacher or engineer be financially healthy if he has a debt of $600,000 and a cash balance of $100,000? If interest rate spike, he may have difficulty to service the loan repayment. Something is not right in these companies. Could the tide be turning soon?
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