I don't agree with the analysis. The articles does not explain fully what will increase profit by another 14 mil as stated. Based on current margins made the company, you must at least record 50 mil in revenue which I feel is highly unlikely judging by their current performance.

The author merely rehashed research reports by UOB and Rakuten and using a lot of "ifs", "possibly" etc.

Well, one thing for sure. Monday's gonna be a blood bath.

@RainT - I'm pretty sure their customer's gonna go back to them since both of their bosses have a good working relationship. Big question is can they quickly change cardboard designs to suit new requirements by next qtr. Also side note, they really really need to diversify customer base, with that sort of cash they have in hand, I'm sure they can.

Yes. Pretty disappointing to be honest. At least they did better than immediate past qtr.

Yes this will be interesting to watch. To be fair, MCO was in full swing this QR. Most companies had to work at 50% capacity to follow SOP.

@dawchok - Great article. I'm not surprised with the outcome here. If you are really interested in investing in Magni, I would recommend waiting this QR to be released before deciding.

@scholez - 15% discount rate?? That's pretty optimistic right? Some companies only do 6-8%. What is your justification?

Riiight... Says you

That is a sign that big money is exiting

@lcng123 - Its because people are dumping RM assets due to the uncertainty. It should hover around RM4.15 per USD.

@Chonghai - trade war doesn't scare you but this does? Usually dividend players would hold out unless there are big changes in business strategies or the company's dividend policy. Plus talking about valuation, i think its safe to say that market is starting to price it Covid-19 impact albeit slowly.

@macOS - Very unlikely to achieve such valuations. Market adopting wait and see approach to gauge the intensity of Covid-19 impact. Some investors are opting risk off approach to consumers related to chinese demand.

You fishing for people to offload your position? Very irresponsible

@remus - You have to check Nike online sales in China. But I feel online sales would not be able to cover the closures of physical stores in China. Even if production shifted, you have to contend with no demand. It would be interesting how things will pan out.

@Rotiboy - The proper question to ask would be why you want to invest in Magni in the first place? If you are happy with its business model, company financial position and dividend yield, I dont see any point of holding back

@ok

Good question. Should post it to RCECAP's management the next AGM.

But i think thsy are reluctant to venture into car/home loans as both these items are considered big ticket items which may necessitate RCECAP to loan more money which usually means margin compression similarly to what is currently happening in AEONCR.

@ok
Referring to the post :
https://klse.i3investor.com/m/blog/LouisYapInvestment/2019-11-18-story237167-Malaysia_Stock_Analysis_Report_RCECAP_9296.jsp

I don't think RCECAP will venture outside personal loans to gov servant. In terms of loan recovery, it is easier for RCECAP to loan gov servants as they have salary deduction scheme where monies as automatically transferred to pay back loans.

@Johnathan Choi: Didn't you write an article about a potential black swan behind RCECAP from Angkasa loans being dished out indescriminately? Despite the fact, why would you still go into RCECAP?

@chesslim: I disagree. It will be way beyond Magni's historical PE range and would be overpriced at that stage.

@William Ng: My opinion is based on its historic PE. I think it is stuck with low PE is because that Magni has no plans to expand its operations (i.e. M&E or looking for new customers etc.). Hopefully if Nike decides to open up new facilities in Myanmar, Magni would follow.

@William Ng: At the current price, I would say that it is fully valued. Unless Magni suddenly decides to do an M&A, do expect the price to hover around today's level or less.

@klse888 Usually I wouldn't even bother investing a company for a 5 to 10% return. If that is the kind of returns you are looking for, then you are better off investing in ASNB. Lower risk with virtually guaranteed returns of around 5.5 to 6.5% p.a.

@apple168: I should ask you the same. Why are you worried about my stand on Magni? I'm not concerned so much about Mr Trump's view on trade, as long as Magni (and Nike) does well, should we be really bothered? Moreover he has been president for 3 years, during these 3 years Magni has been consistent in dishing out dividends, how would another year be any different?

Magni's jump in profit is not hot air like London Biscuit, it is backed by increase in cash and assets which resulted in increase of NTA per share. People pay for that growth, not just coz you say its overvalued.

@apple168: As long as Magni's business has not changed in any singnificant way, why should you be concerned? As far as this quarter is concerned, Magni did pretty well.

Majority shareholders of Magni are Tan Poay Seng and Tan Sri Tan Kok Ping. Every time they buy or sell shares they have to declare the trade, I don't see them sell. Of course, you are always welcome to sell/short Magni shares if you know better.

Frankly RCECAP is a good company with a reasonably sound business model. The management are committed to only give loans to quality lenders which can be seen in their y-o-y drop in impaired loans. Plus their customer base is mainly government servants which are stable income earners.

Most likely reason why the market isn't valuing them like elk-desa or aeoncr is the fact that their market is limited (i.e. government servants) which usually translates to limited room for growth in business. Another possible reason is that RCECAP only gives out non-collatarized personal loans which are considered risky.

Great quarterly results from Magni. Congratulations to all who invested.

eskay67: Although that is true, do not forget that Aeon Credit intends to move up market (i.e. M40) which usually translates to higher loan value and corresponding interest.

apple168: What you just posted made no sense. Tariffs are aimed at China, not Vietnam! President Trump's endgame is to contain China. Just a few days ago he just asked American companies to leave China. This would leave Magni at a better standing since if Nike does take President Trump's directive and get out of dodge, they would have to source garments from Vietnam to compensate whatever lost production!

You really should post one dollar money game story to your recommended stocks. God knows people there need it.

Agreed with Philip. If RCECAP wants to improve their value, they should consider venturing into collatarised loans business (i.e. housing loan, car loans etc.) and diversifying their customer bases to include GLC employees as well.

antoniomc27: Could possibly due to ELK-Desa does second hand car financing which is expected to be boom during times of economic uncertainty. In comparison to personal loans, you at least have the car to act as a "collateral" (albeit a lousy one but better than nothing). Also, anyone with a decent credit score could take a loan from them.

In comparison, RCECAP does personal financing which in theory is riskier because it is not backed by any collateral. However, mode of repayment of the loans is through monthly salary deduction which, again in theory, should negate the previous risk as I have not known GoM to default on salary payments to civil servants. Secondly, they only make loans to civil servants which limits their customer base. The larger the customer base, the more loans you can give. I think PH government may limit uptake of new civil servants to save money which could also explain why the lack of interest in RCECAP.

apple168: Yes we should. From the likes of you.

apple168: You have just discredited yourself. If you have nothing better to argue against their points, you should refrain from making further comments. There is a saying it is smarter to say nothing, than saying something which is means nothing.

As of right now, USD continues to strengthen against MYR, additional 10% tariffs on remaining imported items from China which will encourage Nike to take from Vietnam, continued sales growth of Nike in China as per latest QR, Nike against trade war with China which will create sympathy for Nike in China, upcoming Olympics which will boost sales even more.

Plus bonus issue and share split as cherry on top.

I pity you let your blind hatred get the best of you. Probably it is better you take your sympathy elsewhere ( like your Hibiscus, Genting, Ajinomoto and all other stocks you recommended). Most of them are reeling from losses since the last time you recommended them. Lucky you are not in China, the CCP prolly will make you disappear for causing unsuspecting traders for losing so much money.

apple168: He can shout whatever he wants because frankly at the end of the day, he either gets the deal with China done or he can kiss his re-election good bye. Anyhow at the mean time, I am appreciating his efforts in strengthening the USD which means better profits for Magni.

apple168: Both Nike and Apple are AGAINST the trade war against China. Since US is taxing sporting goods from China, they would be more inclined to take more from Vietnam!

apple168: Peg the ringgit? With what reserves? As of today, 1USD=RM4.18. Nike was one of the few who openly appealed to President Trump to stop the trade war against China so there will definitely be some sympathy among the Chinese public. With the US imposing tariffs on sports clothing from China, Nike would draw more from Vietnam which benefits Magni! Furthermore the Olympics is coming next year which will be a bonus to them as well.

apple168: 1USD=RM4.155.

remus: As long as fundamentals are intact, it shouldn't be an issue. Price will always fluctuate.

@shareinvestor88: Buy and sell at your own risk.

@Whey Whey: Pointless to predict where it goes tomorrow. If you think worth keeping for long term then go in whatever the price point is. Price is what you pay, value is what you get.

@bwho: That's incorrect way to look at it. Bonus issue and share split is usually means to increase stock liquidity. It should not be viewed as the same as private placement where your holdings get diluted. As long as company continues to make continuous profit growth it should be viewed as a reward to shareholders.

@Whey Whey: This is why:

Share split and bonus issue

http://www.bursamalaysia.com/market/listed-companies/company-announcements/6242505

@john doe: increase in receivables could also mean they are not getting paid by their clients. From the current QR, Russia is virtually their revenue source.

hng33 : Personally I think this is a damn good stock with continuous revenue and profit growth with relatively low PE and relatively OK ROE. I'm not so sure why market isn't valuing this the similarly to Aeon Credit and Elk Desa. Anything to do with default rates?

cyeec2000: Cannot blame apple168. He has vested interest in doing so. Best thing everyone can do is to make sure proper research is done to counter whatever untruth this person is dishing out.

Like Ajinomoto, a few days ago he was pushing it when it was RM17.80. Now it is RM17.28. He lucky there is no law to prosecute him for irresponsible calls.

shareinvestor88: Please do some research before deciding to buy or sell. No one here will be responsible for your losses if you blindly follow forumers here.

Carson Teor: Magni before this is "usually" valued at PE7-8 which is where it is now. RM8 is PE12 which i think quite unlikely at this juncture.

chonghai: That is true. But from what I observed in some of their recent qtrly reports, they managed to bring down operating costs a bit. Plus with new plant up and running 2nd half 2019, savings should be more substantial. Otherwise no point having new plant if there is no improvements to their existing production line.

I am interested to see how Magni's management deal with increasing labour costs.

apple 168: You can sell if you want. No one's forcing you to keep and hope you can find peace in it.

Carson Teor: Will never happen in the near future. Consolidation around RM5 more likely for a few months.

Fundamentally one of the better non bank institution with low default rate. I dont think tax claim from government will be of substantial impact to its business.

apple168: You got it backwards boy, had I listened to you, I would've lost big. Resorting to personal attacks still doesn't answer your questionable intentions. Thank you but I will be avoiding all the stocks you recommended. Good luck trying to push them.

apple168: You have been preaching the same thing since last 1-2 years (i.e. TP 2 as per 26/06/2018) till now. If anyone had listened to you then would've lost 23 cents per share of dividends + capital appreciation of about 10%. That is a whopping RM2300 in divs if they have 100 lots!

Good intentions... Really?