I am out of BAT. Sold 9.65. Average cost prior to sale 9.67. Tiny tiny loss mostly due to commissions than actual loss. I hav3 over 40 other stocks that has better prospects than BAT. Consider myself lucky in BAT not to DCA and move on. Too many great stocks out there to worry about BAT.

For disclosure, my holding is still underweighted, at 2.1% of my portfolio.

When analyzing GENM, one must remember to subtract the huge depreciation and amortization which is not a real loss in the current year, but refers to the past. In H1/23, the depreciation is 618m, larger than total dividend bill of 510m (6 sen). So, as GENM turns to profit in Q2/23, it means its cash should grow i.e. 6 sen is clearly supportable.

If it sustains/improve its performance by year end, then, the 9 sen appears supportable but it will have to dip into its growing cash in H1, to pay the 9 sen for H2.

And if I keep getting 15 sen per year, the dividend yield of 6% (at current price of 2.51) is good enough for me to keep in my drawer. Still beats EPF, albeit at potentially higher risk (but also higher potential reward later), notwitstanding it is still not showing any signs of accumulations.

Professional investors can't afford to accumulate stocks that sits still. But individual investors can. I don't mind getting paid 6% p.a. returns whilst waiting.

IMHO, this company is solid enough to keep adding when price goes lower.

@nepo, thanks for sharing. However Maybank IB may be working alone and not have the support of others yet. Still hasn't seen signs of accumulation by the market. This one must be patient.

The real question mark for dividend investors is the next dividend that's usually paid in April. Will earnings be good enough to support 9 sen like last year? If earnings are not good enough to support 9 sen dividend, then, there will be a dividend cut and notwitstanding all the good news promoted by Maybank IB, if it cuts dividends, it means something is wrong. By right good news should give good dividends, not cutting dividends.

I still accumulate at lower prices (subject to maximum portfolio limits) but with no signs of accumulation, this one can be a long wait.

Quek can live up to 100 quite easily with the monies he has. But I am also okay to get 6% returns for the next 18 years ..... haha

Do what professionals do. Find a good boss with proven long term track record (at least 5 if not 10 consecutive years) and be 100% transparent to him/her.

If you are not beating FD rates, not beating KLCI index after 3-10 years of self investing, either you find a professional boss (not those educators who charges you a lot of monies with no real long term proven track record), and for 99.9% of you who cannot find one, then, put your monies into EPF first. Especially when EPF beats your past 3-10 year track record. And learn about good quality REITS. These can help you beat EPF. And be on the lookout for low cost unit trust - these are good with good timing i.e. after market crashes.

To amplify what professionals does with BAT.
1. BAT is not a component of the KLCI index (Top 30 companies). Therefore, if a professional results is benchmark against KLCI Top 30, then, he would only invest in BAT *if* he thinks that BAT will outperform the KLCI index. Here, he doesn't, therefore, he has zero weighting in BAT.
2. BAT may be a component of the FBM Top 100. If so, it's weighting should be less than 1% of the index. So, if the professional investor is benchmarked against the FBM Top 100, his neutral stance is less than 1% of his portfolio. If he owns more than 1% of the portfolio, it means he is bulllish on BAT. If he is bearish on BAT, he will own slightly less than neutral stance. And if he has strong bearish views, he will probably hold 50%-70% of his neutral stance since he also has to report to his boss why he deviates. He may hold nil, if he can convince his boss that FBM100 will remove BAT from its index.

This is typically how professional investors invests. They don't make huge deviations from their benchmark.

And for sure, they do not do DCA. Their boss won't let them.

But in education space, someone always teach the ignorant retailers to do DCA, different than what the professionals do.

Actually, when I cut loss tomorrow, I also don't behave like an institutional investor.
Institutional investors benchmark against an index. For example, KLSE index.
Therefore, their mix follows the index.
Let say the BAT share in their benchmark index is 1%.
So, their neutral stance is 1% mix.
When BAT share price falls, it's share in the benchmark index is automatically reduced to 0.8% say.
Then, the institutional investor do nothing - they maintain their mix to 0.8%.

In short, the professional institutional investors do not blindly do DCA, as what "educators"/websites/etc. teach ignorant retail investors.

The professionals get someone else to teach the ignorant retailers to do things differently than what they actually do.

I made a mistake in BAT, when I queue and not chase at RM10. My purchase at RM10 is nearly 1% of my portfolio. My strategy is simple here on Monday. I am willing to sell on Monday. Let say I sell at RM9 and lose 10%. This is only 0.1% of my capital. I have far bigger trading wins let alone dividends collected that will over come this. Therefore, I have no plans for a DCA in this stock. I cut my loss and move on. Odds are high, I will sell higher than 9.57 close successfully, so, my loss is even smaller than I planned.

This should be the professional mindset - not DCA blindly.

Only amateurs do DCA in a situation like this.
Later, on Monday, if there are professional investors reading this and putting on their thinking hats, they will cut loss and sell on Monday. Professionals do not commit more monies into a losing stock. Neither does Institutional Investors. Only amateur retailers keeps throwing good money into bad investments.

For this type of company, do NOT do DCA (Dollar Cost Averaging).
All you are doing whenever you buy is just throwing good money into a bad investment.
It doesn't help at all, whether your average cost is RM20, RM15 or RM10 when price is going down to RM1.
What matters is how much you have invested.
It matters a lot whether you are 2.5% invested, 5% invested, or 50% invested in BAT, regardless of your average cost price.
If you are 2.5% invested, the most you can lose is 2.5% if BAT goes to 1 sen.
If you are 50% invested, half your portfolio can be wiped out.
Therefore, if you are wrong already here, do NOT do DCA.

By right, all IB should be recommending Strong Sell on BAT. Hold is simply wrong. Those holding since they call to hold would have now lost 80% of its value because of holding. There is only 1 correct call which is SELL. Doesn't matter if you sell at the opening on Monday at 9.57. In 2 years time, 9.57 will be seen as very good price.

If I was Buffett and BAT is available for sale, I might consider offering 30% premium over NTA because of its existing cig business. Maybe RM1.7 and no more than RM2. then, once I own it, I will slash management expenses, stop this silly investing and spending in Vuse, and try to protect the cig space earnings. My estimated yearly earnings is around 65 sen. I would not pay more than 3 times for that, since it is dying space. I might prolong it to 3 times more but that is the reward for the risk I take. So, a private sale might generate RM1.7 to RM2 to interest buyers to take over BAT.

BAT says it is late in the Vape space because it's trying to follow the laws of Malaysia. Haha. That's like the worst excuse. Market knows Vape generates RM3.5 billion revenue, where Vuse is not even capturing 3.5 million yet. It doesn't even get inside 0.1%. This is certain death. As in not supporting RM9.57 price. More like supporting 9 sen price. BAT has to do a lot of work to be valued at 95 sen with vuse alone. Remember, BAT number of shares outstanding is 286 million. 1 sen means it needs to generate 2.86 million in earnings. If sales is lower than 3.5 million, earnings a fraction of that, it will struggle to be valued at 9 sen without cigs.

Vape market has already grown +53% in 2023 to RM3.5 billion market. Where is BAT's share in Vape in this RM3.5 billion market? Practically not even 0.1%. BAT is too late in the vape. What does it know about vaping? It has to learn and start from scratch. Sure, it tries to copy and use the best out there but what competitive cost experience does it really have? It tries to bluff by saying Vuse is just like Dunhill etc one of the leading brands, but that is empty claim, not supported by market share statistics. Market knows the truth and this one cannot bluff. Whereas if BAT claims Dunhill is fantastic experience, that is 100% true and supported by market statistics. Market knows when BAT is talking the truth vs bullshit.

Interesting analogy Income. BAT is like a Mainframe computer producer who finds itself with no moat in the laptop space because there are hundreds of China producers who produces laptops cheaper, faster. The best thing BAT can do is not spend millions to try to compete with the hundreds of China laptop producers. The best thing it can do is to convince people that it's mainframes are indispensable, and able to perform special things. It may not be 100% true, but BAT is dying anyway, no harm to try to prolong death. But if it tries to compete with these hundreds of laptop producers in China, it will just be burning cash for nothing.

In 2024-5, I will not be surprised if BAT falls to RM7, because I think there's 80% chance of happening.
I would be extremely, extremely surprised, if BAT didn't touch RM7 by FYE2025.

The second best thing BAT can do is to convince the world that smoking cigarrettes gives a better feeling than vaping. Make it a VIP experience. A privilege for the privileged few. Show real rich only smoke cigs and not vape. Spend 10% more on advertising to give that ultra superior brand. In other words, rather than invests in vape and competes with hundreds of China producers, accept death and tries to protect the cig market. BAT's future is in the cig market which is dying, but it's a question of prologing death, or die faster by committing suicide by spending a lot on vape and then find it has no moat in this new market due to China. What can 1 Malaysia cig maker do to take on hundreds of China vape makers - not even Malaysia government can stop this trend.

The best thing BAT can do is slash its Management expenses by 20% every year. Cut its cost of sales every year by 20%. Then, as it shows bigger profits, its share price will rise temporarily.

But eventually, after say 1-3 years of slashing expenses by 20%, it won't be able to do so.

Then, it's price will resume its fall towards RM1.

The more BAT spends to penetrate the Vape market, the faster it's price will fall.
Hard to understand if you are not a business man.
It is far too late for BAT to take leadership in the vape market which is dominated by China.
It is end-game already for BAT. It's future is sealed.

Exactly 3iii.

If tomorrow, BAT successfully converts 100% of its cig smokers into Vape, BAT will trade at RM1, close to its NTA of RM1.31. Of course, it is impossible to happen. But give BAT 10 years, I think it's doable. Eventually, a lot of these cig smokers will convert into Vape where BAT competes with hundreds of Made in China vape makers. BAT is a nobody in the vape market in Malaysia.

In short, there is no fundamental reason to own BAT. There is no technical reason to go long on BAT.

Graham is different from Buffett. Graham would never touch BAT and neither would Buffett. BAT fails to meet Graham's criteria to invest in cigar butts with margin of safe. BAT NTA is 1.31, P/NTA = 9.57 / 1.31 = 7.3 times, so, Graham would discard BAT. Graham may consider BAT when its price / NTA is around 0.7, i.e. when BAT price falls to 0.7 x 1.31 ~ 92 sen.

Buffett would disregard BAT too, as his places strong views on where BAT would be like in 10 years time. Answer - not a bigger earnings business, as the market is shrinking.

@MOBA, Motley Fool is not talking about Malaysia.

@MOBA, lol. If you follow technical analysis then, you should be shorting BAT and hold your short until BAT shows reversal. Right now, from memory, the RM10 has been strong support for 3 years meaning now that it is conclusively broken, technical analysis says it can fall as low as RM7 in next few months to next couple years if I am not mistaken. I am not a trader per se but if I was I would cut loss and wait at the bottom using technical analysis. Or if Bursa lets retailers like me short using online retail platform (I can’t do it yet), I would prefer to short at spikes.

Right now, it's too late for the government to do a U turn. The permanent damage has been done. Malaysia government has to now accept that its tax revenues from BAT will forever be lower. This is close to certainty already. The reason the damage has been done permanent is because Vape market is now RM3.5 billion, close to cigs market of RM4.9 billion. The exponential increase in Vape was +53% last year i.e. it is already too late and nothing Malaysia government can do now.

Even if tomorrow, Anwar comes out and says GEG is disbanded, nothing will change. Vape market will continue to grow, cigs market continue to shrink. The best Anwar can do is to say "cigs will be taxed lower" - then, BAT will spike 10% say but the downtrend remains.

Basically, the downtrend is stronger than anything the government can do.

Last year, the Group's Revenue is 2.596 billion. Cost of sales is 1.918 billion. The problem is this high cost of sales - a massive 77%.

Now, we know tobacco leaf is very, very cheap... a tiny fraction. Not even 1% of the retail price. By right, they can slash the massive cost of sales a lot. But there is only 0.1% willingness to do this. 99.9%, everyone in the chain wants to milk the most out of a declining revenue.

So, how will BAT ever grows its earnings sustainably? I can't think of a way, unless I own BAT entirely, slash management costs by 80%, reduce marketing costs (since my brand has monopoly) and try to "hunker down" in a declining revenue business. Basically accept I will die eventually i.e. how can I maximize the value before I die completely.

This is the logical and optimal thing to do.

however, the odds of this happening is 0.1%. 99.9%, they will end up spending more despite declining revenue, to try to survive and in the process, kill themselves faster.

BAT expenses is extremely fat because it was once a leading company.
Go to BAT Annual report page 88 and you'll see how much they pay their Directors and Senior Management - it's a fat amount. Multi-millions in a declining business. They need to slash that a lot and hunker down. Which of course, has 0.1% chance of ever happening. Odds are, 99.9%, these expenses will remain fat whilst everyone of them tries to milk the company as much as possible.

A simple exercise for all of you "investors".

1. Google "Best cigarette in Malaysia" - you will see many BAT products out there.
2. Google "Best vape in Malaysia" - you will see nothing of BAT products out there.

If BAT keeps its expensive expats in Malaysia, keep spending and spending and keep trying to make a presence in Vape in Malaysia to replace cigs, this stock one day won't be worth RM1 ...

Vape market in Malaysia (2023) ~ RM 3.5 billion ==> increasing trend, maybe doubling every 2-3 years? (LY increase +53%).
Cigs market in Malaysia (2023) ~ RM 5 billion ==> decreasing trend.
Hard to imagine non-smokers take up vaping - likely at the expense of cig smokers switching.

The high dividends from BAT this year, last year, prior years ... have gone up in smoke unfortunately.
Replacement is real.

Among cig smokers, they all know what is Dunhill, Peter Stuyvesant, KYO, Rothmans ... etc. this is BAT's moat - monopolizing say 16% of all legal and illegal cig market.

Among hundreds of legal vape makers (forget illegal first), does Vuse even command a tiny fraction of the branding power?

If BAT Board and Management comes out and say they will replace Cigs with Vape, you run away from BAT very, very fast and never touch BAT ever again.

@engineering ... The only way forward.....Rokok is haram (vape is not).

With this view, BAT will become a penny stock in next 3-5 years. If rokok is truly haram and BAT has to close its cig business in 3-5 years, it will become a penny stock. Vape cannot create even RM1 in value to BAT.

@tnang, BAT is no longer suitable for dividend investors.
The huge question mark is what is future BAT strategy - will it be #1 = To maximize milking its cash cow (cigarettes) notwitstanding it is a declining business? or will it be #2 = Replace cigarettes with Vapes to be sexy and "follow the trend"?

My target price for #1 is 10%-15% annual reduction in share price per annum.
Target price for #2 is far bigger = maybe double, and a share price crash.

The irony is no Board and no Senior Management will opt for #1.
This is similar to ASTRO where it is in a dying business, and ASTRO opted for the sexier option which is #2, which is to get a HUGE loans, kill its cash cow and now it dies even faster. #1 dies very slowly but milking its cash cow can justify say 8%-10% dividend yield, but #2 - even with 10% dividend yield is not high enough, when yearly fall is larger than 10% per annum.

Hence, investors and dividend investors should avoid BAT. Only traders, trying to pick bottom and sell on bounces may consider but odds are majority of traders will lose.

If tomorrow, BAT stop selling cigarrets, closes its entire cigarrette business and focus only on Vapes, it's share price should not be larger than RM1. It will become a penny stock.

Yes, there are lots of illegal cigarettes in Malaysia. however, mathematically, it is obvious to investors that:
1. Assuming 50% legal and 50% illegal and BAT+2 others controls 95% of the legal market, then, mathematically, BAT + 2 others control say 48% of combined legal and illegal cigarettes. That's still a huge share, say 16% each.
2. Assuming 300 legal vape producers of which BAT is 1 of them, BAT will be lucky to command 1% of the legal vape market.
3. It is unclear if BAT can even catch 1% of Malaysia's vaping market share let alone 16%.

If one assumes margins in Vape (after taxes) equal to margins in cigarettes (after taxes), then, it is clear, that BAT today will no longer be the same company as it was years ago before Vape comes into the picture.

BAT has to continue to push the cigarette business because it still has a moat.
If BAT kills its own cigarette business, its market value will crash and burn.
Analysts are just waiting to downgrade BAT further if it doesn't protect its moat

@MOBAjobg,
Re your comment on 11% vs 8.5% on moderate risk vs low risk, historically it is not supported in Bursa index in Malaysia.
Anyway, this is a forum on BAT.
BAT business model has changed after Vape.
In the old days, BAT and 2 others controlled 95% of Malaysia's cigarrettes, with regulatory protection, heavy taxes - little competition, extremely high margins, true taxes are high but after tax margins still profitable.
Today, 90% of the vape producers are from China. There are hundreds of legal vape producers selling in Malaysia. Not 3 companies. The competitive landscape is now completely different. The Malaysia vaping/cig world will no longer be the same as before. This is why, BAT fall is permanent.

Now, as to where is the bottom, no one knows. Eventually, the bottom will be hit. If this bottom is drastically lower, then, rebound power is stronger initially, but I would advise people who owns BAT to exit on bounces, because BAT is no longer the same company competing in the same market in Malaysia. The Malaysia market has changed permanently.

7.43 closing. Nice.

As dividend investor, one should study its dividends closer.
1. TTM dividend = 75 sen.
2. 75 sen is record low dividend - prior FYE dividends = 88 / 98 / 83 / 118 / 155 / 169 / 232 / 312 for FYE 22 / 21/ 20 / 19/ 18 / 17 / 16 / 15.
3. Over past 8.5 years, dividend has SHRUNK 15.4% per annum.
4. If dividends continue to shrink 15% per annum, then, FYE 2023 dividend will not be 88 sen, but lower ~ 75 sen. Coincidentally, this equals TTM dividend of 75 sen.
5. Looking closer, BAT has cut Q1/23 and Q2/23 dividends to 13 and 16 sen respectively (Q1/22 = 17 sen; Q2/22 = 25 sen). Q3/22 & Q4/22 dividend = 25 and 21 sen which looks high relative to 13 and 16 sen, suggesting Q3 and Q4 dividends may be cut further i.e. FYE2023 dividend will be lower than 15% shrink rate this year.
6. My guess is that FYE2023 dividend = 68 sen (say 66 to 70 sen). Basically I am giving myself a 7 sen buffer cut. that Q3 and Q4 2023 dividend will be cut by a total of 7 sen.
7. What do I think of 68 sen dividend for 2023? At RM9.57 closing price, 0.68 / 9.57 = 7.1%.
8. What do I think of 7.1% in a declining dividend stock that shrinks its dividend by 15% per annum? Not quite enough reward yet.

So, I think I'll wait at a lower price before getting in. Still downtrending anyway. Let's see.

Turnaround may take longer than 2025 or may not come at all. If during good times, they lose monies, the bet in turnaround is not prudent. At best one can only *hope* for speculations of a turnaround. The company’s financial structure is permanently altered 2 years ago with the huge loans vs massive Net Cash then. This is no longer the same company. Bad case of mismanagement. The loss is permanent.

MBB is a lot safer than BAT. BAT is still declining. Market doesn’t like BAT strategy to switch its cig clients to Vape due to further expected loss from cash cow segment into a new segment. Expect earnings to continue to decline. Those betting on warrants is hoping for a miracle price spike by expiry date which is not in the best interest of the warrant issuers. Warrant issuers always win in the long term.

Don't argue, make money. I sold at 4.10, and bought back at 3.73. Make my own dividend of 37 sen. Can't complain.

Nice. 20 sen dividend (DRIP shares @ 1.39 + remaining cash) finally credited on 11 Sep.

Personally, I wouldn't chase. I am selling into strength, because my hypothesis is:
- Last time Aug 2020 (Covid), after downtrending and after breaking out above the 200dMA, it zoomed up without much retracement, so ...
- This time, alternation principle i.e. same conditions, it will retrace back strongly ...

Market rarely repeats, but rhymes.

I will buy back when it retraces.

Well. Looks like it really got stopped at the 61.8% Fibonacci projection level and consistently fell 4 weeks in a row back to 4.4. You got to respect the 61.8% for sure.

I hope it keeps going up. I went in at 1.23. Sold half at 2.04. Went back in at 1.3. The stock is just being very nice for patient traders. However, all these are just small positions, for fun.

I personally won't chase at RM1.25.
However, worth noting that 2 years ago, when its dividends was 6 sen and the stock was trading at 90 sen, that is a super 6.7% dividend yield stock! It's a screaming buy. At RM1.25, still not bad - 7 sen / 125 sen = 5.6% but less compelling to me, but maybe still very attractive to many dividend holders. I prefer to take more risks and buy a good dividend payor at very low prices, if I see them.

Typo. Stock is not trading at 1.25 sen but RM1.25 ... LOL

This stock is certainly under-valued from P/BV and from P/E, but the dividend that it receives from RHB is still larger than the dividends that it pays out to shareholders. If it maintains final year dividend at 4 sen/share, this brings total dividend to 7 sen/share giving a dividend yield of 5.6% at current price of 1.25. Not bad.

The tide is change too. The past 3.5 years, dividend year has been steadily rising:
2020: 4 sen
2021: 5 sen
2022: 6 sen
TTM 2023: 7 sen.
This is a nice trend, which is why price seems to react favorably.

My average cost is 91 sen. The stock is trading at 1.25 sen and looks like it wants to go up.
However, for me, this is a trading stock, not a dividend keeper i.e. I plan to take profits on price strength.

Eventually, wait long enough, I will sell everything and eventually ... wait long enough, price will fall back down again and I will be buying back again ...

@fortunefire, actually, LIIHEN can afford to pay higher dividend.
In the past, it has been very conservative, paying only 40% earnings or less.
However, over the past 3.5 years, the payout ratio is steadily rising - the question is - will this become a new trend?
2020 - DPS 4.7 sen / EPS 14.0 sen = 33% payout
2021 - 2.7 sen / 7.2 sen = 37% payout
2022 - 6.2 sen / 13.9 sen = 45% payout
TTM 2023 - 7.1 sen / 12.2 sen = 58% payout.

With Net Cash of 37 sen, and trading at 87.5 sen, the business is available for sale for only 50 sen.
It's long term EPS is 12 sen, i.e. this wonderful business is only selling for a P/E of ~ 4 times.

It's dividend yield is nice for TTM 2023 = 7.1 sen / 87.5 sen = 7.0%. That must beat EPF nicely at this depressed price.

If the Company continues to share its profits with shareholders (e.g. a payout ratio of 80% EPS should be very sustainable given the huge Net Cash position, even to cover very bad lean years), even without any Special Dividends, it's DY will be higher than 7.0% and this stock is well overdue for a re-rating up.

Personally, lower prices is sufficient reason for me to accumulate.