I think doing a plant visit is the best way to understand, to see the truth behind. Some companies has some ambitions, however in driving the growth or momentum is a bit lacking. It could just perform a single quarter then came down due to many reasons sometimes, labour, material, then forex loss. In conclusion, not able to produce a momentum of profit growth ( at last last for 2 to 3 quarters).

EG has changed its direction to a higher margin model.They key point is do they able to execute it in terms of facility, man power (the know how), then procurement and importantly the sales team to get customer. EMS is very competitive industry, only the bigger and stronger can survive.

In overall, EG sems like going big from their expansion. Now, it is about how well they can run the momentum. So, talk to the management is the best way to kmow.

Anyone nearby Penang or interested for the sit visit. If we have enough shareholder request for visit, I believe they will grant us that

anyone went to AGM? any update?

hi fly,

do u have the details of the line expansion it has done with the cash call ?

why got writeback of the yarra project expenses? May I know which quarter it incurred and the amount

Not bad your technical..I also aiming at comfort

@greatful...It is not same as Supermax...The way they being stopped..And if you see it rebounded

Hi ymchan,

Technically, it is end of the falling market. How fast it would rebound? We need the confirmation on the supply side... Generally, it is a good sign...There are quite a number of stocks performing the same way...If u wish to learn...I may give you the sign when it is ready...Btw..I don't think the banker is here to have fast gain...

You may private message me..I do not do open comment as everyone have different view

It depends on how it rebounds. That's why I mentioned need confirmation.

This is the message I want to bring out. I have bought this share around 50 sen. The main purpose of this message wants to bring about is to alert shareholders not to be panic. I am not saying this is a worldclass company but they are building worldclass building. Industry wise, they are in construction which is fairly competitive. Margin is definitely is not a nice double digit figure.

But, if you sell at this moment, it might indicates you do not understand the rule of stock market, being shaken out. Fundamental is an important knowledge. Understanding the rule of finance market is also equally important.

Thanks LeoTing sharing. Looks like the shortage could be due to some major steel player furnace down also increasing pricing has triggered buyer to stock up as well before the price trending higher. If based on inventories, no doubt ssteel could fill u the market shortage as it is able to run its facilities

Do Masteel have furnace to melt scrap steel? Or they just bought billet and rebar it right? Since Lion's Amsteel and Anjoo furnace have issues, then ssteel should be winning more market share?

I thought fully automated RTA has been installed during June 2016. Still yet to see improvement? Currently evergreen no on production...is it they sell by purchase from others?

Well....a down move is unstoppable temporarily....

Hi Waadalui,

Could you ask about the new factory? Initially, i thought they have operated for the milk packaging. But , it seems what they have invested just factory according to 2016AR. So, when would be the machines came in and start operation. I think it already a year already. The warehouse I think has been completed and for operation already.

Thanks

uptrend will kickstart

Great article...may I know did u do some valuations?

Any difference betwen cscsteel and prestar? What about Choo Bee? What makes the difference that some make money and some are not?

So, based on PEG valuations, at what value is cosidered fair value? I reread the news the 25% growth in 2017 is refer to overall profit growth of 25% or 25% of the growth will becoming from bright steel? What is the bright steel used for? Its margin expanision is due to recent steel price rally? and the effect of CRC regulation lifting up?

i did check their website..mainly on construction....EPC....so also based on contract basis....what is the fair value u think the company...I based n the data you provided..and the chart tells me it is worth Rm1.5.....

what is the msi contribution..did they mention in their acquisition?

May I ask why you relate copper price with this share? Are you saying that one of the products that produce from waste recycling is copper? And may I know you saying the TP of 25 sen is based on what valuations?

So, you define it as accumulation as the graph dive into bottom and it din create new low though the vol is high?

May I know how you define as accumulation from the volume of the weekly chart where there are upbars and downbars? Could it be distribution on high vol?

Ya..i infact really plan to go ahead and buy..but, when I read thru, I have this doubt. And if coming quarter still cashflow problem, they will be running low on cash for expansion..the debt is not low in fact...I have been in E&E industry...I know it is very competitive especially OEM....

Any update on the visit?

Hi Ming Jong,

Yes, the VSA is a triggering method for me to dig deeper into it. I find that VSA also being too short term. In fact, noise is higher in short term. Thus, I did modify it and use for being mid and long term investment. I find that it is quite useful.

A lot of breakout could be fake or a trap. If we do not analyse the chart in an overall view, it will always being trapped and sometimes stop loss is not fast enough as the drop could be very significant like what happened in Gadang and Mycron. Thus, this is the reason I have modified based on VSA.

ANyhow, any method is a good mehod if it works for you to become profit. I am glad you share your knowledge with me..

Hi Ming Jong,

Thanks for your information. I totally agree with you the management of trading and investment is different. From what you explain to me, I understand this is the technical analysis commonly used in market.

Just to share with you, I used more on volume and spread. However, I did modify in a way that will give me more confidence on holding mid term (3 months to 6 months) especially when investing. Johotin, I bought around 20 sen for the warrants just about 3 months ago. JHm I bought around 55 sen on March this year and sold during end of Aug at 1.38. This are the fundamental stocks that I bought and I use technical for entry/exit that shorten my waiting time. You may see my previous comments.

Just to understand are you purely based on pattern to judge the stock trend ?

Hi，

A few of the stocks you mentioned was actually in my portfolio for investment and trading (some stocks I just treat as trading as their fundamental wise I am not familiar with).

Just a bit curious, on the way you drew the rounding and target price. Have you ever trade on the stocks you mentioned? I am here to learn from you not other purpose. I am a technical guy as well..and I did use it for my investment. I am more to spot a trend...I don't do daily trade.

I am sorry to say that personally I feel drawing a pattern and trend line is a bit virtual as the same person on same chart can draw the trend line with different angle each time.

Becareful.....in 2 weeks time, you will see a TOP is formed. Resistance round RM2.13 is an area of distribution...

Thanks for your info. I have yet to go into PUC but I have studied Sedania.

Make it clear, that I am not bias as I don't own both either. Sedania is considered a well-managed company. Why I think so?

1) Good apps (Green Bill, Share Share, etc) and it keeps innovating. This is critical especially for IT related company to stay competitive

2) Good in business development. Able to capture into almost all major telco in Malaysia. I just guess it might be the pioneer and possible the only one providing Air Time sharing (please correct me if I am wrong). It even enter Bangladesh market

3) Good company image. Well, if you look into their website and website does reflect how company manage its investor relations and possible external customer.

4) Company mentioned that they will focus on marketing moving forward to promote its product

However, although it had many good points, I still dont buy it. Reasons

1) IT/App is a very competitive market. It needs talents only able to shine. In conclusion, IT will be heavily spent on staff cost to remain relevant in market.

2) Unfortunately, no matter how good the app is, I only see they keep focus on air time sharing which I don;t look good. If you aware of telco market, you will see the shrink of prepaid market due to cheaper post paid package. I know I just simply plug this from my observation on surroundings. But, who are those prepaid market, it is the immigrant or foreign workers the most. Do you think they will often use the app for air time sharing? Or will they really need such service? Well, one good indicator is the Bangladesh market. It already more than a year there. You can notice that their market is not stable from their revenue. In fact, Malaysia revenue is in decreasing trend for a year. Managment even admit it but push it to GST, while in fact I dont buy this reason.

3) If a company do not have a stable business, even they stop on R&D. How can can they go? Even they keep exploring more mobile operators, I don't see the market. In summary. No market no business.

That's my qualitative analysis of the company. No figures are needed if we don't see the market. BTW, they have into collaboration for the cloud business. Not much information. But, this is also a very competitive market. If they can do it a lower cost, lots of SMI will be their potential customer.

I will look into PUC. But, if you can provide me more info. That will be better of course.

Thanks again for your writing.

It is a good strategy in fact. Buying a too low profile company or without much growth, then you to wait. Buying company that is beaten down during irrational selloff but fundamental still strong, will give a good yield. The timing of turning over is also critical. Mudajaya is one of the excellent examples.

Hi zexon,

Thanks for your comment. Normally I dont talk too much on this but let us put this as sharing and learning from each other.

For FA, if we purely based on numeric of past record, then we are studying the history. But, if we based on numeric and analyse it further qualitatively, then it is not about past it is about future.

For TA, it is a little bit complicated subject. Too many people argue is TA works? I do have same doubt before. But, I have one important concept that makes me believe TA will work which is if there is no market manipulation, stock price wont move even though how good the stock is because stock movement is by human and fundamentalist will not buy stock in such a way to push the stock up.

I have used these simple concepts that helped me do quite well in this few years.

Anyhow, let us cut the story short. Let us continue to monitor this stock and revisit each month and see how it works. I like to do this case study as well and learn from all of you.

I used a lot of TA on buy/sell after my fundamental study. I wont give an exact price because I know it is almost impossible to predict on that.

But, if based on trend, it is much easier. For Hevea, I would say, very likely, it will be fluctuating or sideway for sometime (1-3 months).

For me, I see distribution is already ongoing. Let us continue monitor and see for 3 months.

My summary for Q3.

1) The Q3 gross margin has dropped by 2 %. Diary margin (8.5% PBT) dropped by about 3-4% compared to Q1 and Q2 which is 12-13%. Tin manufacturing not much changes
2) SUgar and milk powder price is on uptrend
3) USD loan increase due to trade loan. However, loan in RM has dropped significantly by 20 mil to 379mil.
4) Interest expense remain high of 5mil. Majority of the interest expense (10mil in 3 quarters are paid for investment for a stake in KianJoo)
5) Depreciation remained high of 5.8mil perquarter
6) Outlook remained. But, monitor on milk powder on sugar price as government would like to increase the sugar ceiling price by 30%


Just to share a bit on my investment experience. I never expect the chart would continuously shoot up. I do expect a very good quarter report even better than 2Q. the result is not bad but not so excellent compared to 2Q. My take is this chart would consolidate for a while, but moving north is the way it is going.

Ya..i think my eyes are blur at this moment..let me finish this and go zzz

I think others include associate result, and other investment holding as well...

this is why we have section like segment result which is negative and we have interest income

But, I wonder what have they financing and get high interest expense for this "others" section?? This interest expense of 10mil span for 3 quarters is about 3 mil per quarter..it is very high.

Regarding property rental income, I check cashflow, I din see any as well....Where do that figure comes from?

hello popo92, others is actually contribution from KianJoo, you check the share of resuts of associate is matching the YTD in the income statement

May I ask where do you obtain the property rental income of 13mil? I cant find it in the quarter report

GKENT is going downhill....on the way for some consolidation of at least 10-20%

You need to be patient...A stock needs several factors to be ready to push...The chart has shown the selling pressure ease..and the manipulator has enough bullet to push it..

Just my personal view, a good stock can be pushed if there is enough manipulator that is going the same way...On the way to push, a lot of different views will make it zig zag....

Lets sit tight and see

SUPERMX ready to become superman tomorrow...

Just a recall from my last post.

You may chek the chart. I am happy for everyone. I am very happy as well...enjoy the ride

Posted by andyhard > Sep 25, 2016 10:25 AM | Report Abuse X

1) As of 2Q 2016 performance, if I strip off the 3 mil FOREX gain, EPS will still be aound 0.07. (calculated based upon before bonus issue)
2) If based on EPS of 0.29, and PE=10x, the TP is around RM2.9 (ex bonus issue TP=1.087)
3) Cashflow has become very good in 2Q, inventory came down and short term trade facilities also very low with long term borrowing remain low
4) Cash has increased and it gives the group a chance to expand the milk powder lines in 2017.
5) The small MI at 2Q2016 0f 0.6mil, indicated the PAT of around 3 mil for Able food which produce milk powder.
6) This is still far away as 1Q2015 alaready achieve 3.7 mil PAT for Able Food.
7) The factory and warehouse is expected to complete by end of 2015 as indicated by the increase in capital ex and also in assets
8) Now, after 2 quarters after FY15, I expect the company should be more or least stable and should be able to provide a boast in revenue and increase in margin
9) My short/medium TP=1.087. Longer term TP=1.5

TA wise, the chart is getting read

Expect significant retracement....15-25% retracement....need to monitor

Hi hng33, may I ask you trade based on technical or fundamental? It seems maybulk will still consolidate for a while

hahaha..another TGuan in the making.....I am quite eager for its next quarter result

Just some updates on what I found,

Borrowings dominated in USD
RM'000
Q2FY16 Q1FY16 Q4FY15
Secured
Receivable financing 6,519 56,342
Foreign currencies trade loans 6,989 5,159 7,818


Unsecured
Bill receivables 4,246 40,024 4,418
Foreign currencies trade loans 42,895 18,134 61,036

Total borrowings in USD 60,649 63,317 129,614

In conclusion, the exposure of borrowings in USD had been reduced significantly from Q4FY15 to RM60mil in Q2FY16. This is a good move to reduce the risk to forex fluctuations.

I have checked that the PBT margin for can manufacturing is so meagre around 2-4%. In fact, it is rather close to Johotin. Can division revenue had been stagnant or move around RM80-100 mil per quarter and it is sort of sunset industry. Again, it is same as Johotin case. Reason being is stiff competition. I see that people tend to move forward to fresh food than processed, reducing the demand for can.

Now, back to the basic of a stock that will shooting high as mentioned by Cold Eye, must have 2 engines. One is growth engine, one is macro positive environment engine.

On that, I very specific on management team as they are the one allocate the CAPEX and direction of the company. From the back ground of the Yeoh family, I only can use one word EXPERIENCED. They have built numerous famous brand like Ibumee. So, from capability wise, they are good. From they way they hold KJ Can, I personally feel they are aggressive in controlling or grabbing market share. This is GOOD too. From can diverting to evaporated creamer and sweetener, I think they are good in business sense and growing the company. Same as expanding to Myanmar.

The only bad thing is they don't pay good dividen and they are very low profile (in annual report, there is also not too much information). I just hope that there is no conflict within their family members that will affect the company.

I will look more into dairy business and see how far it can go

TA wise, mmode looks interesting.....It is getting there to fly

Hi Yi stock,

Thanks for your info. As I am studying some other stock, not enough time to kick into this. Thus, your research does help me to make quick decision.

Just a few more questions hope you don't mind

1) I saw the revenue from 2014 already 307 mil for dairy, so it seems 2016 1st half of 303 mil doesn't really increase if the new evaporated creamer line start operating Q32015. But PBT does improve. So, the dairy mainly is on evaorated creamer and sweetener? Do they do on milk powder like Johotin?

2) Regarding FOREX, do you know how much of the outstanding loan is USD denominated? As mentioned by you, the repay 99 mil. If loans denominated in USD are paid down, the forex impact is very high mitigated. If USD stay firm without strenghtened much, then forex impact is much lowered. As long as the fluctuations stay firm, the forex impact is not that much. Do you have the figure of interest paid per quarter. As the borrowings is huge, the savings will be huge as well if they repay it fast.

3) Do you have the margin of the can industry and dairy industry. I have studied quite a bit to Johotin, I can do a quick comparison if I have those figure.

4) Thew new factory in Myanmar in can factory? When would it be expect to start operation?

Thanks. I see recent correction in chart is a good time for us to study more. Consolidation will takes time

Hi...the new diary line expansion completed by Q42015? Did they mention start operation on Q12016? It seems the revenue din increase much...the Myanmar is KianJoo Can new factory??

Thanks. BTW, may I know why you said coming quarter will be very very good? What is the driving force behind? Are there being impacted by forex movement such as raw material? I like companies with lots of effort to improve margin and hardworking enough to work on the capital for expansion or growth especially organic....

TA wise, looks risky...Just be cautious...expect to see some severe downmove