I have been following VGH for some time and got in last week. I...

I have been following VGH for some time and got in last week. I bought despite doubts generated by institutional mass exit. I can see why instos are exiting:
1. The communication from VGH
2. The picture of doctors exting
3. Change of managing director
4. they are already in breach of covenants based on market cap (which the banks may not get too worked up about --but are going to be in more serious breach if EBITDA significantly falls)-this potential terminal event has been reflected in the current price

But where I think value is in VGH is
1. doctors are the crux of the group funcction and they know that; it takes on an average 9 to 12 years after 5years of medicine to become an ophthalmologist(including internship,resident years reasearch then the training programme and fellowship)and after extreme competition. thats nearly a total of 15 to 17 years of learning

2.Ophthalmology is a very competitive speciality in australia and is supply constrained by a very restricitve college; if doctors feel that they are not given their due share then the model will be non sustainable; the board seems to have recognised this and I think this is involved in the 100 day plan; so the company seems to be working towards a sustainable option

3.Since the doctors realise that infrastructure provisions are a core element to successful surgical practice - I think that if a remuneration scheme seems just on them- they will stick on

4. vision group has never posted a loss in the recent past. Its earnings have been flat(because of the lack of a proper perfromance based remuneration scheme)EPS in the last half was 8.7cps. full year EPS is projected to be close to 15cents. (current PE of 1x)

5.although there is large scale dumping, the price has support at 14.5 - 15

6. I believe that in the August final results there will be a dividend of 2cps - this will be supported by the banks in whose interest it will be to prop up the market cap to justify their loan of 110 million for a company with a current market cap of 10million

5 In a years time this could be well trading at at least 60cents

any thoughts?