At RM5.40 the market cap of MKH will be around RM1.7 bil. The plantation 15,000 ha is already worth more than RM1 bil (RM70k per mature ha).

EPS should be more than 40 sen this year and with historical PE of more than 8 .. TP 3.60
Happy investing and happy new year!

To contact the reporter on this story: Jeanette Rodrigues in Mumbai at jrodrigues26@bloomberg.net
By Jeanette Rodrigues Dec 26, 2013 1:50 PM GMT+0800

Deutsche Bank Sees Asian Comeback as Pimco Positive

Taiwan’s dollar and the Indonesian rupiah are forecast to lead a recovery in Asian currencies next year as attention shifts to the region’s growth potential and away from the reduction in U.S. monetary stimulus.

The Taiwanese currency will climb 2.4 percent by end-2014, while the rupiah will start reversing this year’s 20 percent loss by rising 1.7 percent, Bloomberg surveys of at least 18 analysts show. South Korea’s won is seen up 1.8 percent, China’s yuan 1.4 percent and the Thai baht 1.1 percent. The forecasts point to a rebound from the Bloomberg-JPMorgan Asia Dollar Index (ADXY)’s 2.2 percent drop this year, its biggest since 2008.

Taiwan’s potential export gains from a global economic pickup and Indonesia’s yield advantage over most of Asia are adding to the appeal of their currencies as Deutsche Bank AG, the world’s biggest foreign-exchange trader, says the region offers the best growth prospects in 2014. The Federal Reserve’s decision last week to start cutting its monthly bond buying has mostly been priced into Asian exchange rates, setting the stage for advances, Societe Generale SA said.

“We haven’t seen any toxic reaction to the Fed statement, there’s been no bloodbath,” Benoit Anne, the London-based head of emerging-market strategy at SocGen, said in a Dec. 20 phone interview. “When investors come back to work in January, they’re going to realize there’s a huge window of opportunity to go long emerging-market assets.”

Pimco’s Optimism

Pacific Investment Management Co., the world’s largest manager of bond funds, and Deutsche Bank say Asia will receive a boost from a recovery in developed markets next year. The region’s emerging economies will grow 6.5 percent in 2014, outpacing the 5.1 percent expansion of developing nations around the world and 2 percent for advanced countries, the Washington-based International Monetary Fund forecast in October.

Asian currencies will hand investors a 2 percent return in 2014, while counterparts in the Europe, Middle East and Africa region will gain 4.5 percent and Latin America’s will lose 1 percent, Deutsche Bank predicts.

“Emerging markets are maturing,” Deutsche Bank analysts including New York-based Drausio Giacomelli, wrote in a Dec. 19 report. For growth, “Asia remains best placed.”

The Taiwanese dollar will strengthen to NT$29.3 by the end of next year, according to the median of 18 analyst estimates compiled by Bloomberg, after reaching a four-month low of NT$30.06 yesterday. The currency has lost 3.2 percent this year, its biggest decline since it fell 5.7 percent in 2001.

Indonesian Rupiah

The rupiah, this year’s worst performer among 12 Asian peers tracked by Bloomberg, will climb to 12,000 per dollar by the end of 2014, from 12,200, a separate survey predicts. The currency tumbled to a five-year low of 12,260 on Dec. 23.

China’s yuan and the South Korean won will probably perform better than peers in coming months, while the outlook for Malaysia’s ringgit is improving, according to Manik Narain, an emerging-market strategist at UBS AG.

Concerns remain about India’s rupee, which fell to a record low of 68.845 per dollar in August, and the rupiah, he said. The rupee will end next year at 62 per dollar, from 61.98 today, according to another poll.

With the exception of China and South Korea, “we are not forecasting foreign-exchange appreciation in Asia,” London-based Narain said in a Dec. 20 phone interview. “We are particularly worried about India and Indonesia still.”

India and Indonesia will be the only nations among Asia’s 10 biggest economies to run current-account deficits in 2014, Deutsche Bank estimated in report dated Dec. 19.

lcng .. Similar to CPO prices in Malaysia, when you have weaker local currency the CPO will adjust higher to mitigate the impact. IDR/MYR weakened by 4% but CPO price is higher by 8% in Q4 2013.

Merry Christmas and Happy New Year!
A house issued TP 3.05
http://klse.i3investor.com/blogs/kenangaresearch/43925.jsp

MKH pays to pay lesser on borrwoings. I'm thinking to convert the warrant .. Happy investing!

Internet download speed slower than Brunei, Vietnam and Thailand. What has MCMC been doing?
We deserve better services from Celcom, Maxis and DIGI.

我們不如汶萊和 泰国 .. 新加坡沒話講. (以下南洋商报主要版)

吉隆坡30日讯）互联网监测机构Speedtest.net昨日发布的全球宽频下载速率报告称，香港以71.91Mbps高居榜首，新加坡则以53.11Mbps，排第二位。

马来西亚排名第117，宽频下载速率是4.95Mbps，相较于一些亚洲国家，台湾排名第11位（37.71Mbps），中国第43位（16Mbps），泰国第56位（13.24Mbps），越南第57位（12.86Mbps），汶莱第108位（5.71Mbps），印尼第151位（3.34Mbps）及菲律宾第163位（2.90Mbps）。

古巴垫后Speedtest报告显示，排名榜末的是古巴（第186位，0.84Mbps）。

出人意料的是，美国仅以20.77Mbps的宽频下载速率在全球排名第31位。

Speedtest.net称，该公司使用基于Web的网络诊断应用来进行宽频测试，统计日期是2011年5月30日至2013年11月28日，并统计了100多万份测试结果。

This news should be positive to Instacom and OCK.
http://www.thestar.com.my/Business/Business-News/2013/11/29/MCMC-moving-in-right-direction.aspx

Total assets increased to RM1.8 billion from RM1.4 billion, but interest expense dropped 21% to RM17 million from RM21 million. That shows operating cash flow capability of the company.

Alex Chen is bullish so do I..

lcng .. from your analysis eps should climb more than 40 sen next year. This company has been historically accorded with PE 8. Will anyinvestment bank tag TP of RM3.60 (45 x 8)?

bsngpg .. I think it is more of an accounting issue here. Alex Chen does not care about accounting. If you ask me, Q3 should have accounted for some of the forex loss. How can the loss only appeared in Q4, not logical.

MKh shows typical plantation company symptom .. when USD up, profits are hit as they borrow in USD. I guess it is just one of the business risks.
Look at MKH's earnings potential and capacity. MKH generated operating cash flow which was 5.7 times more than last year or RM109 million. This enabled them to substantially finance the investing activities amounted to close to RM200 million. In fact its gearing has dropped from 63% to 55%. I guess MKH is down to earth for not proposing any dividend.
Now MKH's shares are being traded below its NTA of RM2.72 per share.

4Q results out! Plantation made losses. Operating cash flow was strong. No dividend proposed.

Shareholders need fund to convert the warrants .. higher dividend may help and in fact could reduce MKH's borrowing cost if shareholders buy into prospects of the company.

MKH's investment property stood at RM250 million. If 10% increase in market value, EPS will be enhanced by 7 sen.

With plantation, earnings is now more transparent and sustainable. I believe they also have intention to build its property investment portfolio which will be held for recurring income. Small IOI is in the making ..

Manage to read the Edge's article here .. http://mkhberhad.com/
Best has yet to come .. not only the plantation also the property segment as well.
Happy investing!

thanks lcng123 I can understand the articles.

shrobin thanks .. with CPO price now getting higher, it is going to be bountiful years ahead for MKH. Can't wait to get a copy of the Edge.

Below was extracted from the The Star Saturday. Can someone tell what is the FFB and CPO yield? Thanks

~~ Today, MKH’s oil palm plantations estate is 98% planted or about 15,655ha of total planted area inclusive of road drains and cannals.

MKH says the yield achieved was 29.9% higher than the budgeted yield and it recorded its highest ever yield of 25,996.64 tonnes per ha in September 2013 since the commissioning of the oil mill in October 2011.

Plantation companies usually get their crop in 30 to 36 months after planting but we manage to harvest it in 22 to 24 months. It grows much faster and produces fresh fruit bunches earlier because we are located along the equator where there is a lot of water and sunlight. ~~

But how come .. if like that IOI and KLK only report Malaysia output but not the indonesia estate to Bursa?

They should disclose to Bursa the plantation information voluntarily if not compulsory. Any accountant/consultant can advise?

hmm .. 1.75 was ex the bonus and right issues. its market cap has indeed increased my wealth has also increased. The outcome would be otherwise if hop-on-hop-off scenario.

EPS 2010/12.7sen 2011/14.8 2012/26.0 2013/23.9(3Q)
MKH has historically rewarded its shareholders via Bonus Issue in order to preserve cash.
In view of EPS is likely to be higher next year, will MKH do it again?
But given Public Bank a substantial shareholder which prefers cash, will MKH paying higher dividend?

http://klse.i3investor.com/blogs/kenangaresearch/40756.jsp
Plantation - New USFDA Proposal May Boost CPO Prices

Come on ... IOI paid 1 bil for Unico's 12,700 ha. MKH has 15,000 ha but its market cap. has not reached 1 bil. In term of tree age profile and CPO yield, MKH's yield is to show far better growth rate than Unico.

What is the RI price?

Looking forward to next year eps of > 10 sen each quarter hence making inroads into whole year eps of > 40 sen. Says PE 8 TP 3.60 .. enjoy investing!

lkfo512 me too .. great counter .. resilient model .. great growth potential

MKH Boulevard
Property Type:
Serviced Apartments & Boutique Shop Offices

Built-Up Area :
Type A1/A1a Built-Up 575 sq.ft: 126 units
Type B1/B1a Built-Up 840 sq.ft: 52 units
Type B2 Built-Up 840 sq.ft (corner units): 21 units
Type B3 Built-Up 840 sq.ft (corner units): 31 units
Type B2a Built-Up 870 sq.ft (corner units): 26 units
Type C1/C1a Built-Up 1,094 sq.ft: 52 units

Total Units :
Serviced Apartment: 308 units
Shop Offices: 25 lots (3 storey) & 5 lots (6 storey)

Status:
Serviced Apartments : Bumi Units Only
Shop Offices : Limited Units Available

This round MKH may have to hike its dividend to make warrants conversion more attractive. Isn't that one of the things to do for issuing the warrants? I agree .. shrobin that higher dividend rate is imminent .. otherwise MKH will incur higher borrowing cost.

I see it this way... at the low cycle of CPO price, IOI bought Unico for RM1 bil. Unico, a pure plantation company, owns planted 12,700 ha in Sabah. IOI is known to be a prudent buyer. MKH owns planted 15,000 ha East Kalimantan and currently has market capitalisation of less than RM1 bil. Simple comparision - market has not attributed any value to other assets in the MKH Group .. Why?

This freehold land serves to compliment its Kajang 2 commercial development by putting in more population ..

just .. if you believe in QL business model .. before 2010 was teenager after year 2010 is adult .. more wisdom to go a long way. do not undermine what a brand can do and replication of its successful operations in malaysia and indonesia to somewhere else like indo-china and china ..

MKH Bhd, an established property developer in Kajang, recently unveiled part of its 550 acre integrated township, Hillpark Shah Alam, to the public.

The new integrated township, with an estimated GDV of RM1.3 billion, comprises double storey link houses, superlinks, semi-dees, bungalows, shop offices, service apartments, mixed commercial component, a proposed school and a police station.

“Due to the overwhelming response, we opened our second phase, Cherry, for sale, which also received an encouraging response from the public,” said MKH managing director Tan Sri Eddy Chen.

“Hillpark Shah Alam is strategically located in the Northern Corridor of Shah Alam, with easy access to six major highways; Latar Expressway, GCE, NKVE, DASH, Federal Highway and the Puncak Alam Highway. The distance is just 20 minutes away from Shah Alam, Petaling Jaya and Kuala Lumpur,” added Chen.

The project is near University Teknologi Mara, an existing McDonalds, medical centre and an Econsave supermarket. There are plans for a hypermarket to be built soon for the convenience of residents.

Chen said, besides its strategic location, the township was designed with nature in mind throughout the planning stages and caters for people from all stages of life. For those seeking active lifestyles, there will be mountain bike tracks, jogging tracks and innovative playground among other features.

Thematic parks such as Herb Farm, English Orchard, Spanish Courtyard and Japanese Rock Garden within the development will offer residents havens from the daily grind of working life

MKH is keen on making Hillpark Shah Alam a green development.

The company says what set its township apart from other nature-inspired development is the sheer size of its Forest Park and Central Lake Park, providing 50 acres of greenery for all residents to enjoy.

This excludes the neighbourhood parks that will be built in each precinct. As part of the project’s green design, all the units will be built in a north-south orientation to reduce the heat from the sun which effectively lowering the energy required to cool houses.

As safety is also of paramount importance, MKH has incorporated CCTV coverage into the development and perimeter fencing along pedestrian walkways.

The group believes that this latest addition to its growing list of developments will help to meet the high demand for landed properties in Malaysia as well as introducing MKH to a new and wider market in the Northern Klang Valley.

Pines, the first phase of the township, offers 311 double-storey link homes with built-up areas ranging from 20ft by 70ft to 22ft by 70ft. The second phase, Cherry, offers 412 double-storey link and superlink homes that range in size from 22ft by 65ft to 26ft by 80ft. Another phase called Olive consists of 343 22ft by 75ft double-storey link houses.

These units are targeted at house buyers who want larger homes for a growing family. The units in the township start from RM440,000.

“Considering the great value we are offering to the market, the development has attracted young families and first-time buyers,” said Chen, adding that Hillpark Shah Alam has registered over 7,000 interested buyers to date.

Following the successful launch of the Pines phase, Cherry and Olive are now open for sale, with more phases to follow. While both phases will feature their own parks, the more exclusive Cherry phase will have extra greenery in the shape of the Pines Linear Park, Neighbourhood Park, Central Lake Park and the Forest Park.

“We expect Cherry to enjoy quick sales when it is officially launched for sale,” added Chen.

~The Star~ 5 October 2013

This counter moves towards its RM4 TP as 2nd quarterly results draw near ..

"Going forward, we will strive to achieve an even contribution between our two core businesses of property development and oil palm plantation,” Chen, the CEO said recently."
Good! Please disclose more information about your plantation such as age profile and FFB and CPO yields.

1. That's how to see it. At the low cycle of CPO price, IOI bought Unico for RM1 bil. Unico, a pure plantation company, owns planted 12,700 ha in Sabah. IOI is known to be a prudent buyer.
2. MKH owns planted 15,000 ha East Kalimantan and currently has market capitalisation of RM908 mil.
3. Simple comparision - MKH's other assets, which have bigger value than the plantation segment, have no value.
4. Of course you need to consider other factors such as planted area age profile and yields which I think MKH has an advantage to overtake Unico in the foreseeable future.

no advertisement only phonecalls and sms ... 311 units of the PINES link houses in the Hillpark township were sold out. 412 units of the CHERRY superlink and link houses with higher GDV are now open for pre-booking. Entire GDV for the two projects may be close to RM500 mil. No wonder the directors keep buying ..

Major shareholders Chen members consolidate their shareholdings under one roof. Is this normal? Why? Thanks

Buying into MKH is still property exposure. Its plantation distinguished it from other property players which I like it. Be it plantation or property, land being a crucial feedstock. Still MKH could increase it plantation landbank but is costly relatively to MKH size. I like to see MKH to actively seize its property's profit which can then be reinvested into palm oil. The successful launch and good take-up rate of the high rise MKH Boulevard has boosted confidence in the pursuit of high rise ambitions in Kajang.
Thanks bsngpg I could use the formula to compute when CPO price rises :-)

bsngpg 即将腾飞的巨龙美景控股(MKH-6114)[中篇]

Probably ya .. probably now they want to protray MKH more as property player .. which in a way easy for people to understand. Q4 should see higher FFB a general trend before taking into consideration more mature trees in the MKH case.

MKH should disclose more information about its plantation such as tonnage, yield and CPO price realised .. if earnings from this division is expected to rival or exceed that of property. If not required, do it voluntarily lah.

2862862 if your TP is RM5, then the warrant price is 5.00-2.26 = 2.74 Wow! :-)
I look for TP RM3.60 niah ..

It would be highly positive news if this company could secure contracts which generate long term revenue stream i.e. leasing its telecommunication towers and fibre.

you guys notice it? MKH has opted to raising its profile in the TV. Previously - Work hard talk less. Now - 'Branding' is part of the hard work. Bravo!

Chen has bought in again ..
If next year profit up by more than 30%, EPS 45sen is foreseen. With PE 8 times, that is 3.6 target.