@Thirai, if the earnings stand steadily at 10 sen per share till next quarter the PE would be higher because many people will start to believe the plan that Sonos is moving out all the operations in China to Malaysia for products to be exported to the US and this is going to complete in 2022. I read this news some time ago and if this is going to be materialised we can expect a fabulous top and bottom line boost next year.

@JKing. I'm trying to do deeper research and I'm not sure if you could help me on this. Does FPI export Sonos finished product directly to US or is it sent to other factory/company for final assembly? Which company will export the final product to US?

And probably because of that our government is confident that our manufacturers are able to catch up by end of this year to achieve sales slightly better than last year.

I believe quite a lot of inventories (perhaps RM 45 millions) are actually goods that are already landed at US but somehow not yet recognised as revenue or cost of goods sold due to the term of trading. I am not able to verify this at the present but hope someone to enlighten us.

It is not so easy to move out. You got to look at other requirements. Otherwise Lii Hen would have first appeared somewhere in Africa by the name Great Afri Furniture etc.

I think the risk of missing a good entry has become higher than the risk of loosing the opportunity to buy at lower prices over time because:
1) Things are getting better and guys running the business will buy more
2) When things are getting better insiders including management, suppliers, employees are receiving good news and they will buy more too
3) Good news will come out on the newspaper eventually and other retail investors will be interested to buy
This risk-reward curve will quickly skewed in 3 months time so the more waiting, the more expensive would be to invest.

This should be the trend and ignoring the short-term volatility this is an achievable target price with justifiable reward to buy at current price.

@Thirai, the Q3 result is already out for a few days and the price doesn't go south. So I believe this is due to change of opinion of existing Liihen's shareholder where they are looking forward for the recovery of the earning which is yet to be reported in Q4 report rather than the damage which is already done and accounted for in Q3. I agree that the appropriate PE for this stock is around 8 but I think we should use forward PE instead of rolling 4 quarters in the past because we do not expect the same damage to be repeatable. If we are using forward PE, I think reasonable annual EPS should be RM 0.15 x 4 = RM 0.60. Target price should be RM 0.60 x 8 = RM 4.80. Buying at 80% discount the discounted target price should be around RM 3.80. Assuming 40% dividend payout, this should be able to support the price at RM 3.80 or higher.

@LKOH Thanks. I would like to find out and buy one to try.

I thought Dairy Champ is manufactured by Etika Group? What's the relation between Etika Group and Able Global / Johore Tin?

Dairy Champ? Didn't notice. Is it sold in Aeon or 99Mart?

@Thirai - Indeed 2021 is an awful year for Liihen because all factories lost production for 3 months (Jun, Jul, Aug) and some factories loss about a month production in Q1. If full vaccination would be able to prevent this in future, I foresee quarterly EPS to normalise to around 15 sen per share due to raising demand for wood furniture in the US. Don't forget that Liihen is still in expansion mode even if under pandemic. For this particular stock at the present, I couldn't figure a better time to buy it, for a handsome capital return when she announces next quarter earning after CNY 2022.

Is Able Global selling any dairy product in Malaysia?

Davidkkw79, you should have sold it just after MCO 3.0 was announced. But if you have held it until now, it is better to continue to hold it because the business has returned to full swing since Sep 2021.

Pricing of the warrant plus weaker quarter earning drive the price down...

@Cipta, this can be achieved only by getting permit to bring in more foreign workers.

@Teosoontong. Main source of raw material is from local suppliers, not its rubber plantation subsidiary. You can check the segmental reporting in quarter or annual report to verify this. The raw material cost can be transferred but may not be at 100% efficiency and it takes time.

If you are still worrying perhaps you should look for other stock that suits your profile better. It is not good to hold any share you do not feel safe about it.

This share is a growth stock + turnaround (from temporary issues). Growth stock generally gives you long term return and turnaround gives you short term return. With these two combined, you can expect a medium return at low risk in within a year. I don't think there would be any buying opportunity for this stock if it is without temporary steep drop of revenue and profit due to MCO 3.0.

@Thirai - What you feel is very normal if you just look at the surface of the number alone that happened 5 to 2 months ago because it is not a nice figure. However, to see beyond this or to be able to see the future, you need to digest this figure with OTHER INFORMATION. By checking the quarter result in MCO 1.0 and how the earning recovered after that would help you to understand. You may be able to observe that the company is now coping with MCO 3.0 in a lot more effective way to reduce the impact and also you may be able to see that the shock level to the shareholders is a lot less from how the share price curve changed.

80% of the profit comes from market in Malaysia. Contribution from Vietnam is only 20%.

Spread of Covid-19 and MCOs etc. will change the timing of motorcycle production and therefore the transaction but not reducing the demand (the demand should be increasing instead). Therefore recovery would be strong and quick.

Very likely result is already good in Oct and Nov so that the management made a statement where "barring any further MCO, result for FY 2022 will be satisfactory". Furthermore, in general, Malaysian's income has reduced in the past two years and many M40 has now fallen into B40. These people are then motivated to opt for a cheaper mode of transportation which is motorcycle instead of car, due to affordability and the need to rebuild their emergency fund. Lesser disposable income will also encourage them to save recurring fuel and maintenance expenses which can only be feasibly achieved by choosing motorcycles.

Hi CWC1981, Sonos' order is placed to FPI through Wistron. However, I do not know how much of the total order is allocated to FPI.

I beg to be differ. This 2022 Q1 result is far better than what I predicted. With this result I'm a lot more confident that HLIND will achieve RM 0.90 to RM 1.00 annual EPS for FY 2022. If this is real share price will have very good chance to go up to RM 11.00 or higher by end of FY 2022.

Look around other stocks of matured business which could fetch EPS more than RM 1 annually, their share price is around RM 14. So it is quite conservative to predict HLIND to achieve RM 11 or higher when its EPS normalizes to RM 1 or higher annually.

It is unreasonable for the market to price HLIND at least RM 2 lower than its fair value just because of this expected -10 sen quarter EPS as a result of MCO. The money is yours to grab, as much as you need, to buy at current price and wait for 15 to 20% appreciation in 4 months time.

My forecast for HLIND Q1 result: -10 sen :)

Furniture is one of the industries that is expected to turnaround in Q4. Poor result is expected for Q3 due to plant shutdown during MCO. I believe deep pocket investors are aiming for this opportunity as well. What are they waiting for? When inexperienced investors are panic to sell after seeing the Q3 result that is to be released soon because they had not weigh-in the damage of MCO inflicted on the Q3 result, that is the best time for these smart money to take a good position. However, if the fear isn't great enough to motivate a sell down, I believe these smart money will eventually loose patience and starts to flow in by December, otherwise they will miss the chances to buy low.

While US might be reducing the import tax, it is more likely to happen in staggering rather than total cancellation. Furniture industry is still a labor intensive industry and don't forget that wages in China is no longer cheap. Risk of investment should be quite low at RM 3 per share. Even if the business could not recover to the result achieved in 2019, the performance that it requires for the share price to appreciate to RM 3.60 level in early 2022 should be a low hanging fruit to reap. In short, "low risk and moderate / high reward" is what I could think of for Liihen shares at its current price.

There might be back log in Q3 due to MCO but one of the main customers commented that Malaysia factory is recovering better than expected. Actually, most of the FPI's customers feel that demand for audio electronics are still very strong. Some even got positive response from stock market where they are listed when they increase the selling price of their product recently. So the worse thing could be Q3 profit not as good as Q2 but is still delivering decent profit and Q4 will be the best ever quarter that we have not seen before. Don't forget that Sonos plan to double their size by year 2024. Check this out: https://www.bloomberg.com/news/articles/2021-03-09/sonos-targets-annual-revenue-growth-to-2-25-billion-by-2024 Therefore be far sighted if you are really investing into fundamentals and long-term gain.

Hiring 100 operators and expanding...

Thanks @tctan070708 for your kind explanation

Why this company only announce 3 quarter report each year? Anyone mind to help me understand this? Thanks

Let the data speak. Next quarter result will be poor but it will come back strongly after that.

Yamaha 125cc sold out everywhere

Q3 result is coming closer and closer

The darkest days are about to pass. The golden age of motorcycle industry in Malaysia is coming.

The factory closed for about 2.5 months out of 3 months in Q3

Hi Pasar_Pagi, I think Liihen will register net loss in Q3. And the amount of loss would be high enough to cause some sell down once the result is published.

Hi Pasar Pagi, I don't think its plantation is the main source of raw material. Is there anyone able to estimate Liihen's next quarter (Jul to Sep) loss?

Hi Philan, the question is, why would someone jack up the price to 4.50 for these employees to exercise the ESOS and sell the shares?

My guesstimate is that RM 3 could be the high side of the fair value.

If next quarter earning is bad, then the bonus might be less attractive. If the result is very good, then the price might break RM 3.

Hi Carimakan, I think need to wait for a while. Need to apply and wait for Bursa to approve. Long process. The entitlement might be after the next quarter report if it takes more than 2 months.

Suddenly up and suddenly down. Maybe something big is brewing.

It will be most terrible if it close at lowest today.

Looks like another wave of dumping

I think 2.70 is a fair price. I believe annualized EPS 30 sen per year is achievable and sustainable. The warrant is to prevent some late joiners from buying cheap and partially because insiders have excessive cash to re-invest.

Based on this understanding I think majority of existing shareholders are still in a comfortable position to decide either to stay or exit in weeks or months to come.

Technically, the chart shows that sellers have an upper hand, but there is strong support at RM 2.75 to RM 2.77. I guess the management has confident to pay higher dividends so that yield remains attractive at 4-5% after bonus issue to support the share price so that warrant will be still attractive. As such, I think following months the price have strong support at around RM 3 before bonus issue and RM 2 after bonus issue. Please share your thoughts also. Opposite opinion is welcome.

Look at the size of the fund that BPPlas is going to raise through the warrants. It is about the same size in term of the value of existing property, plant and equipment in total. Looks like BPPlas has a plan to double the output in long term plan and possible 50% expansion in short to mid term plan. So I guess business could be so good that massive expansion is required. Well, I could be wrong. I hope that someone who has more information is willing to share here.