No more main wayang for this counter. Time to get serious folks. See last week peaked at 0.265 then dropped. Now the real rebound. Not just pump and dump by the sharks.

I confidently predict that KGROUP will be 0.22 and KGROUP-WA 0.03 soon!!!

KGROUP is rising slowly to 0.20 and more after the good QR. It is as expected as more investors gain confidence in this counter. Its planned IT projects should start to show results soon and then its stock prices will vroom up. Now we see mother share and KGROUP-WA already taking off after prolonged hibernation periods. Be among the first to enter not when it's already taking off.

The recent unexpected recovery of the global oil price is resulting in the present bullish phase of the Malaysian oil and gas companies including KNM, with sudden big jumps in price and volume. KNM has been really down for quite a while in recent memory but now it seems to be bouncing back for the better. Its latest QR is not that bad in terms of PBT and NP, in the greens. Its price recovery catalysts will be more contracts with Petronas (even though RAPID contract is unfortunately diminishing rapidly), ethanol RE plant in Thailand and Borsig in Europe. The Peterborough, UK power project in is delayed but will be online in 2019.

So, Gen Ir Lee is bouncing back with KNM. KNM will rise again like a phoenix. These few days the price of mother KNM rose from 23 sen to 28.5 sen, an amazing 24% rise. And yesterday it was the third most traded stock with volume of 128m. What more can we ask for, hah?

Even the long dormant and pathetic warrant of KNM-WA suddenly comes to life with 270k trades at 0.5 sen yesterday.

Even this traditionally quiet KNM forum suddenly comes alive and becomes a hive of activity these last few days. Indicating good days and weeks ahead for KNM.

KNM might soar to 50 sen, or even RM1, as predicted by realistic optimists here. Arguably, KNM is following in the footstep of jumping JAKS, even without pumping by any prominent investor or unethical sharks. So KNM to the moon, not mere rhetoric my friends.

Without a doubt this is certainly good news for those of us who all this while have faith in Gen Lee and his KNM.

Long live Gen Lee. Viva la Jen Lee !!!

C'est la vie Gen Lee !!!

Ini kali lah KNM !!!

There you go stonenut2. Yahoo!!..., KNM RM1.50 soon. Ini kali lah.

Buy KNM. Bye for now.

Ok Jack Yip, maybe I was also over-realistic and believed in their projected income from the renewal energy ventures. In actual fact, the profit might be wafer thin or non-existent due to operational costs and unexpected extras - plant and machinery depreciation, increasing labour and fuel costs. Higher fees for consultants and directors. These negative factors are seldom highlighted in project proposals to clients or financiers. But lets be positive and believe that KNM will rise up like the phoenix. Ini kali lah KNM !!!

riko, sorry I do not understand your point about TP of 0.32 and 0.4 being the 'lie', and also your very special symbol/character of ... Never mind, I believe you bought KNM stock and would also like to see its price go up. Peace yo!

nikicheong, I'll try to answer your question on why the P/BV, or price to book value ratio, of KNM is so low in my own understanding and in my own way. Later maybe others more knowledgeable can give theirs. And I do hope no accountant, economist or finance expert will laugh at my explanation as I try to act like one.

The ratio is R=P/B, where P is the closing price and B the book value for the last quarter. As B is a constant for the quarter, then R only varies with P. If P is large then R is large; and vice versa. So, in the case of KNM in the last few years its P has been relatively low and disappointing. Recall that before that it was a purely construction and engineering company and keep on getting contracts, thus becoming the darling of Bursa. Then things went south in 2008-2009 but its price managed to peak at nearly RM2 in early 2011. Then it went downhill to around 40 sen in early 2014. However, when oil prices started to fall in 2014 the price of KNM went the opposite way, going up to almost RM1 in the middle of 2014, then nosedived to 40 sen in early 2015. Then increased to about 70 sen in a few months time of March 2015 before falling to a roughly linear trajectory to around 30 sen now in May 2017. So, in the last 5-6 years the value of P for KNM has been having a roller-coaster ride of RM2 to 40 sen to RM1 to 40 sen, then 70 sen and now 30 sen. Assuming, and hopefully this is a realistic and reasonable assumption, we can replace B with the present net tangible asset (NTA) value of RM1.12 for KNM, then R varies from a low of 30/112=0.27 to a high of 200/112=1.79 for KMN in the period of 2011-2017. This first order, or back of the envelope, calculation shows that in terms of R, KNM is not doing too bad in the covered period, at times below expectation (undervalued, R<1) and other times above expectation (overvalued, R>1). The undervalued period, R<1, seems to be from 2012 to now. So yes, R for KNM has been low these last 5 years. Why? That's the question of nikicheong, I presume.

So why the low R for KNM these last few years? Do also keep in mind that UMWOG, Armada, MMHE, Alam and other O&G guys are not having great R either for this period of time. In 2014-2016 the global oil price collapsed dragging down the major oil and gas players and their contractors and suppliers like KNM. In particular, KNM lost the bet (investment) in the Canadian oil sand (shale oil), due to shale oil extraction in Canada/US becomes uneconomical when oil price falls below USD 40 per barrel. Local contracts like from Petronas dwindled. KNM also reported losses in its Brazil and Kuantan ventures, but I was not able to extract further information about these particular failed ventures from their latest reports, 4Q2016 released on 24 Feb 2017 and 2016 Annual Reprt released on 28 April 2017. So, obviously the weak earnings and bigger losses led to the depressed prices of KNM, and hence lower R, the defined price to book value ratio.

But, there's a silver lining in the cloud for KNM. Its change of focus from purely contractual projects to renewal energy projects is leading to a change in its fortune. And going to provide it with recurring income. Its ethanol plant in Thailand with construction contract and capacity of 500,000 litre/day will provide it recurring annual income of RM15 million from 4Q2017. Then its waste to energy plant in Peterborough, UK of initial capacity 18MW, final capacity 80MW will give it RM 50 million annually from 2018. And do not forget that by 2016, KNM was awarded about RM 500 million of projects in Pengerang RAPID. More contracts could be secured in 2017 and onwards. But as cautiously warned by yifie_911, securing a project carries a risk of not executing it well or as planned.

Sorry if this rather long and winding write-up bores and annoys some of you. I do this because I'm excited about the near future prospect of KNM. And I have my own self and financial interest at stake. I also see many enthusiastic KNM supporters here.

Buy call on KNM by HLIB with TP 32 sen - The Star Tue 16 May 2017 - repost:

KNM GROUP BHD

By Hong Leong Investment Bank Research

Buy (upgraded)

Target price: RM0.32

HONG LEONG Investment Bank (HLIB) Research is optimistic on KNM Group Bhd, following an announcement by the latter to invest a further 1.3 billion baht (RM159mil) in its bio ethanol project.

The process equipment manufacturer and energy group has recently announced that it has allocated 1.3 billion baht (RM159mil) for the construction of Phase 2 fuel-grade Impress Ethanol Plant in Thailand.

“Overall, the investment is a positive to the group as the investment for the bio-ethanol project’s second phase signifies the successful implementation of the Phase 1 project, which has been completed in early May 2017. The project is expected to provide long-term recurring income to the group,” said HLIB Research in a note.

The second phase of KNM Group’s bio-ethanol project in Thailand is projected to raise the plant’s overall production capacity to a total of 500,000 litres per day. To note, the first phase of the project could only produce 200,000 litres per day.

While it is positive on the announcement by KNM Group, HLIB Research indicated that it did not rule out the possibility of delay in the commencement of the project’s second phase. This is due to the fact that the first phase has also been delayed for about a year.

However, the research house added that the risk of project cost overrun would be minimal for the process equipment manufacturer and energy group, as the engineering, procurement, construction and commissioning (EPCC) works of the plant would be carried out by the group’s internal EPCC arm.

“The earliest earnings contribution from this project is only expected in 2019. Based on assumptions of ethanol selling price of 23 baht per litre and cassava cost of 5,600 baht per tonne, the expected profit contribution of the second phase project is estimated to be RM15mil, which is in addition to first phase’s expected contribution of RM10mil.

“We believe the worse is over for the group and expect a better financial year 2017 ahead, in anticipation of stabilisation of oil prices and maiden contribution of KNM Group’s Thai bio ethanol project Phase 1 which would provide recurring earnings base for the group,” said HLIB Research.
The research house upgraded its recommendation on KNM Group to “buy” and left the target price unaltered at 32 sen.

Read more at http://www.thestar.com.my/business/business-news/2017/05/16/genting-malaysia-bhd/#cb6cuJqZUuyht1q2.99

Very happy to see that KNM is moving up again. This KNM forum is suddenly alive and kicking with positive and optimistic comments. The recent good news of the Thai ethanol plant project is really a catalyst for the present investor confidence and positive momentum. The UK renewal energy plant is also expected to contribute positively soon. The recovery of world oil price with the recent OPEC and NOPEC planned cutbacks will ensure that KNM will get more O&G contracts in the near future, leading to better financial quarters. The recent TPs by HLB and MAYBANK of 0.32 and 0.58, respectively, could be easily reached with recent announcement of big contracts. Even the warrant of KNM-WA which expires in Nov 2017 could even reach 5 sen. Remember that KNM is a resilient and well-diversified company. Its founder/CEO has experienced rags-to-riches then to rags again journeys, representing the ups and downs of the economic cycles. He and the company persevered and undertook different projects to survive and prosper. So for us, especially the small time investors, this is the chance to be richly or reasonably rewarded for our loyalty to this company through thick and thin. Hope the next QR at the end of this month reflects positive results for KNM. Mother KNM goes up about 10% in this mornings trade. Then we'll see KNM-WA shoot up.