@qqq3 stop giving hollow statements. use proper reasonings and arguments to defend the scheme. most people here have understood the scheme better than you and yet still critical of it

I already mentioned the 20% is only worth something if you convert into traditional mortgage. if you sell and price has depreciated, you will bear the drop for the first 20% (essentially wipe off your capital). read the terms more carefully before brainlessly trying to defend this scheme

just to be clear, I don't see this as a ponzi scheme. it doesn't rip off new member's money to pay off previous members' returns

but it is actually more of a financial/investment product than a financing scheme. and it's also a marketing tool for developers to unload their unsold inventory to the very people that can't afford it in the first place. it is encouraging speculating and excessive lending

like what others have pointed out, when houses are unaffordable, no matter how creatively you package it, it is still unaffordable unless you tackle the underlying issues

@qqq3 you have failed miserably in answering all the questions. let me just show you point by point how you are still confused

1. plenty of hawkers and businessmen with no regular income own houses, banks are smarter than that. in fact they are more than happy to lend money to you if you are creditworthy. the problem here is the target buyer of this scheme is not creditworthy
2. simply put, buyer who can come out 20% on his own most likely qualify for a loan. otherwise, he's just feeding off parent's or other people's money
3/4. agreed upon doesn't mean how the scheme works is right. the whole scheme is still heavily in favour of developers
5. the problem is this scheme doesn't even identify or try to screen buyers with the right profile. there's no telling if your credit rating will improve and the scheme is only interested in selling properties to whoever that wants to buy it
6. it's not free,nothing is free in life. your 20% is already paid and if the market doesn't appreciates, you could lose your entire 20%, that could be more costly than rental
7. how to make arrangements if buyer can't get loan? investors also needs to be protected. if market is soft for another few years does it mean investors will be stuck while buyers get to live for free for another few more years?

in case you have not understood the scheme, your 20% is only worth something if you buy it after 5 years. if you sell it's subject to market prices and any depreciation will be borne by you

have you also heard of a chinese saying "there's price but no market"? the last transacted price may be RM500k, but no one's gonna buy at that price when the market is soft and actual value is RM400k.

lawyers can't help if the scheme is inherently in favour of developers. and if these uncreditworthy buyers are seduced by the no monthly payment thingy, do you think they will bother to understand the fine prints?

if you still can't grasp what's the potential problems of this scheme I will summarise some questions for you, maybe you can try to answer them

1. why is the buyer not qualified for loan? why is he buying a house if he's not deemed creditworthy?

2. how does the buyer get the first 20%? is it loaned from sources with even higher interest rate or simply relying on others (family and friends)?

3. why for normal sales, the developer can offer rebates of up to 40% and can't recoup any of such rebates/discounts when the house appreciates? but here developer gets to recoup it at the expense of the buyer?

4. why does the developer share on the upside but not the downside? similarly investor downside is also after buyer bear the first 20% depreciation

5. is there a restriction on what price level the buyer can purchase based on his current income and projected income in 5 years time? if not how do you think buyer will be able to refinance the house after 5 years?

6. if after 5 years buyer wanna stay he has to refinance at market rate, how is it different from buying a new property other than the 20% which probably doesn't come from his own money?

7. if after 5 years buyer can't refinance and wanna sell but market is still bad with limited buyer, does it mean the property have to be sold at all cost (steep discount)? what if multiple properties at same location from FundMyHome hit the market at the same time?

these are key questions that need to be answered before this scheme creates a time bomb in our country, both for the property industry and individual buyers. buying properties with money that you don't have, refinancing down the road etc. are the key reasons why subprime mortgages happened in 2008 crisis

for this scheme to be viable, property needs to appreciate in 5 years time for that 20% to be worth something. mind you, if the property nominal value is RM500k, its actual value is only RM400k (that's what developers actually value them hence the 20% discount). so instead of thinking RM500k appreciate by 20% to RM600k and above then buyer gets capital appreciation, in actual fact the property needs to appreciate by 50% (RM600k/RM400k) before buyer can see capital appreciation

this whole rebate/discount system is one of the main causes of property prices skyrocketing between 2011-2014 but now when market cools down, there's no way you can pass a property worth RM400k as RM500k anymore. Developers and buyers need to wake up and face reality, there's no free lunch in life, if anything you are just stealing from other people's lunch...

I don't know what are you missing but they did amend the faq example so now the role of developer is not explicitly mentioned there maybe that's why you are confused. but it's still the exact same thing so notice how buyer's portion doesn't appreciate until house appreciates more than 20%? there's even an article written by others just on this FundMyHome scheme which you can refer to have better understanding. next time maybe do a bit more reading before passing out judgment?

the whole point of my article is not just to point out how this scheme merely help out developers (and FundMyHome portal) but also they are targeting the segment that are financially vulnerable and possibly financially illiterate. They could be tempted into buying the house because of the no monthly payment for 5 years thing without properly understanding the scheme and risks involved

I have updated the scheme after studying more. Now I figure out the developers' game plan which is to give effective 20% discount (by using buyers' money) to get investors to fund the 80% for returns. Best still, they even get to participate in the first 20% capital appreciation.

So developers get to sell inventory, get cash and potential capital appreciation to recoup rebate/discount and zero downside, while investors get returns plus potential capital appreciation with limited downside (most borne by buyers). It's the buyers that get the raw deal as depreciation will hit their capital while appreciation will mean higher refinancing cost. And ultimately it depends on their eligibility of a mortgage loan in 5 years' time

they should also stop misleading people. P2P scheme does not promote home ownership, it merely kicks the mortgage application 5 years down the road. In the meantime, instead of paying rental, you pay the 20% amount upfront (which is a lot)

I disagree with PM when he said he was convinced because he was shown the property and buyer. Of course developers are happy to list their property on that portal and buyers (or speculators) are also more than happy to get involved in such schemes which "sounds too good to be true"

I symphatise with developers over land cost, compliance cost, bumiputra quota etc. But I believe in market forces. If the market is telling you it's oversupplied now, you slow down building, not take the easy way out to make the market work for you

As for certain someone, I don't think he has the people or the nation's interest at heart. Maybe just to help his developer friends and make a quick buck himself

Property market is not crashing.It's just undergoing a healthy correction right now. But the developers are impatient and just want to keep selling houses that majority cannot afford. What I can't accept is people pretending to be noble but in reality just want to rip off the poor that is financially vulnerable and are not aware of the risks involved

I believe mass public housing is the way to solve property issues for lower income while middle and high income group will be subject to market supply and demand. One day I might write another article to explore how this may work in real life

1. We need to understand each market unique characteristic. Our market liquidity is a problem due to domination of institutions. We need more liquidity not less. Value Partners also commented that our market free flow is too little and it's unhealthy. If CGT is imposed which discourage realising profit by our institutions, chances are they will never dispose any shares even when valuations are unattractive, which also means value investors will not waste their time in our market

2.I agree with you that some reforms are needed to strengthen our capital flows. But these can't be improved overnight whereas new taxes can dent confidence instantly. Again using a patient's analogy, you don't perform surgery on a weak patient, you let him recover strong enough first before it can be done

3. I am mainly referring to market with low liquidity for your point 3. It's the same problem why Sdn Bhd find it hard to raise equity because many people don't invest due to lack of liquidity. Companies don't stop raising financing once they list. They might still need placement, rights issue etc. to continue to grow the company. If our market is not attractive, they will list elsewhere where it's easier to raise money in the future. And mind you, good companies which can list elsewhere probably will while those lousy companies which can't list anywhere but Bursa will stay. That's when you end up with a bunch of rejects in our market

Bottom line, my personal view is CGT is the wrong tax (limited revenue impact) at the wrong time (volatile capital flows). Our priorities now should be clean up and develop our capital markets first. Beyond that, I am not entirely against the concept of CGT

I wrote this article hopefully to raise some awareness, after realising how little the man on the street understand this issue when I was talking to a friend.

Feel free to share this article or spread the word. I may not be entirely right, but at least others would get the chance to see this issue from another perspective.

Thanks for all the comments. As expected, readers here are overwhelmingly against CGT, most likely due to self-interest.

But self-interest apart, I do worry of the new taxes and their potential impact to our economy. Our largest trading partner China is suffering at the moment and dark clouds are forming in global economy. Hope our govt does not throw in any reckless measures in Budget 2019.

it's sad to see that a young person who sounds brilliant yet shows such narrow mindedness. hate to see talent get wasted so some advice below, whether you understand and/or accept is up to you.

1. in life, attitude and interpersonal skills often are more important than academic brilliance, i.e. EQ>IQ. of course, best case is to have both

2. labeling others is dangerous especially when you don't know them well. this is also often an act of arrogance, thinking you can put complex personalities into categories

3. technical trading is not just about charts and indicators. good traders would know it's about market psychology. last I checked, psychology is still a globally accepted university subject (but I never think it's exact science, because humans just don't behave all the same). again judging something without spend time understanding it is reckless

4. all stocks will suffer in a crisis, just the extent of it. you may think that your stock picks will survive it but you forgot all your assessments were done based on pre-crisis assumptions. during real crisis, say blue chips like Nestle could also fall 80% because nobody can be really sure of when economy and consumption will rebound. and also partly because in crisis, unit trust and ETF investors will redeem their investments and fund managers will be forced to liquidate the holdings. so to think that fundamental picks will survive crisis is just naive

5. surviving a crisis cannot settle who is superior between fundamental and technical investor. so what if a trader sees signs of market peaking and sold all his shares early while you keep averaging down until almost bankrupt as the market tanked 50%? his process better than yours? traders > fundamental investor? every crisis there will be investors and trader who go bankrupt

6. investing is better practiced than preached. it's not all about the intelligent investor or fundamental value investing. one may argue that ultimately everything can be classified as high or low risk investing. then it's all about risk-adjusted returns. if others are taking slightly more risks yet get significantly higher returns than you, you are simply not as good as you think

7. The biggest flaw for fundamental value investing is assumptions. I am a fundamental investor and I love this great quote "investing is a probabilistic decision based on imperfect information on an uncertain future". that's why there will always be different views of what is the fair value of a company. so if you think the company is worth RM4.00 and today it's RM4.50, so you sell as you think it's overvalued and would revisit if it falls below RM4.00. I may think it's worth RM6.00 and so now I would label you as a trader who try to time the market, would that be fair?

8. Managing other people's money is totally different ball game and learning on the process is simply reckless and irresponsible. if you haven't been able to manage your own money well, then don't take others' money as you may discover one day you might lose more than just money. there's no set criterias to meet before you manage others' money but based on this article, maybe not yet

careful, could be another stock like brahim when MAS start to cut cost. but to be fair to pecca, their biggest customer is perodua not proton

still unshamefully spreading lies, why don't you share the source of your crack spread data
http://www.cmegroup.com/apps/cmegroup/widgets/productLibs/esignal-charts.html?code=D1N&title=JAN_2018_Singapore_Mogas_92_Unleaded_%28Platts%29_Brent_Crack_Spread_&type=p&venue=0&monthYear=F8&year=2018&exchangeCode=XNYM

all refineries go through statutory turnaround, even the likes of petchem etc. if what you only see is the drop in production from this scheduled downtime, again shows how short sighted or limited in knowledge of the industry

for those who try to spread lies that refining margins are going down in 4Q based on an ill written article, please use your own eyes to see the chart below

http://www.cmegroup.com/apps/cmegroup/widgets/productLibs/esignal-charts.html?code=D1N&title=DEC_2017_Singapore_Mogas_92_Unleaded_%28Platts%29_Brent_Crack_Spread_&type=p&venue=0&monthYear=Z7&year=2017&exchangeCode=XNYM

for those who try to spread lies that refining margins are going down in 4Q based on an ill written article, please use your own eyes to see the chart below

http://www.cmegroup.com/apps/cmegroup/widgets/productLibs/esignal-charts.html?code=D1N&title=DEC_2017_Singapore_Mogas_92_Unleaded_%28Platts%29_Brent_Crack_Spread_&type=p&venue=0&monthYear=Z7&year=2017&exchangeCode=XNYM

half baked analysis

1. don't know where the chart comes from, look at cme data, 4Q refining margin so far better than 3Q
http://www.cmegroup.com/apps/cmegroup/widgets/productLibs/esignal-charts.html?code=D1N&title=DEC_2017_Singapore_Mogas_92_Unleaded_%28Platts%29_Brent_Crack_Spread_&type=p&venue=0&monthYear=Z7&year=2017&exchangeCode=XNYM

2. EPS 113 is for 9 months, not full year.

such careless and elementary mistakes

if petron 25-30% upside is insufficient for some investors then good luck. some stocks may seem to offer much higher upside but sometimes it may be wise to ask yourself why they are so undervalued, chances are most of them are value trap. if you have invested long enough you will know that net asset play is one of the worst methods of investment, especially when shareholder activism is so low in Malaysia

total sales volume also touch the 9m barrels/quarter level for the first time!

last year was 7.8m, last quarter was 8.5m. I don't think malaysia vehicle volume has increased a lot during the same period, which means petronm is fast gaining market share on petronas and shell. this is a sign of healthy and sustainable growth on its retail side

derivatives are used to hedge exposures such as currencies, commodity prices etc. When you hedge, you are locking in positions for certain time at certain level, i.e. you may avoid some potential losses but also may have to give away some potential returns. this has the effect of smoothing your profit so it won't show too much volatility and over time, such gains and losses tend to even out. that's why petronm profit is now more stable, hopefully investors finally appreciate that

Great results. company made d conservative choice to hedge so make losses on derivatives so this quarter make less profit than they should but long term will minimise volatility. net cash at RM110m now despite higher working capital and paid RM59m dividend

some dishonest puncak advocate and triplc critics slam triplc like crazy then suddenly turnaround and say they make money from it, makes me laugh at the same time wanna womit. mislead others in the past and refuse to acknowledge the mistakes, totally disgusting behavior.

so what if you make money in one stock or two? doesn't hide your other mistakes. we talk about probability and consistency, making more winning investment than losing ones over longer period. those who think that they are smart by making money from one stock, without making due analysis, sooner or later will be the classic example of how to be a millionaire...by starting from a billionaire

9M net profit already double 2016 profit. in fact in terms of core net profit (excluding revaluation gain), 9M profit already at a record high since listing

1. revenue grew because of general insurance, not travel insurance
2. part of their low profit is because they can't contain the claims in general insurance, so the biz that is growing is not a profitable one (at least for now) plus competition from detariffication will hurt them
3. the main reason the biz is bad is not because no one buys travel insurance but because last time its biz potential was overstated. people bought travel insurance without realising it, once the practice is banned, tune biz drop drastically
4. if 4q the seasonally strong quarter eps only 1.77c, investors better sell now and look for other stocks.

plenty of better companies trading at cheaper valuation, no need to be stubborn and stick to the same one

RM3 is the cap by disposal price but if for some reasons it doesn't go through, we know at least it's still deeply undervalued, I don't expect some scums to understand that. My readers and me make our money from RM1.50 to RM2.38 yesterday while we also make so much more in other stocks highlighted in my articles. all while some sorry low lives can only visit pages of companies they don't own, talk shit but salivating at the returns

book value is the worst way of valuing a company except for financial stocks

publics justification is lazy, even if market cap is smaller, does it justify PE being 50% lower than regional average? based on their RM14.46 tp and 7.5x PE, putting 10x PE will get a tp of RM19.30 and its PE still below average. then their market cap will be obviously higher and deserve lower discount?

zecon disposing 49% of its RM606m university concession for RM155m. that shows you triplc RM599m concession alone should be worth close to RM310m, not to mention the Z1P2 and all its land value. this has again substantiated my previous verdict that this company is seriously undervalued

it's clear that some people in life are just pure waste of resources

many contra traders are eager to get off the ship. they will then come back when it's closer to ex date for dividend, typical

but completion risk is minimal now, it would be more of waiting time. igb is also trading at a discount to goldis offer for this reason. triplc should trade closer to 2.70 now (10% discount for the wait)

that will be after disposal completed, now should still have some discount

Triplc (or Pimpinan Ehsan) will be a PN16 company so this time round it's different from Puncak. Puncak got more cash from its disposal but only distribute RM1.00, Triplc distribute RM1.95 which is the max it can distribute with its current retained earnings, if not more approvals needed and delays. If you want to estimate how much the price should trade at, look at previous PN16 examples such as Tecnic or Abric (close to cash level after disposal completed)

1. It's a sensible thing to distribute most of the proceeds back to shareholders. For new acquisitions, the company can always gear up or raise appropriate amount for it. If reverse takeover, will just issue shares, so the management did the right thing by not keeping too much cash around

2. As highlighted before, high dividend is the best chance that triplc shareholders will vote for the deal. Of course, no disposal then there won't be dividend. It's a package deal, you have to vote for both or otherwise, no cherry picking

3. People have been asking again whether the price is fair to triplc shareholders.If you refer to my earlier articles, it's clear that the deal significantly undervalues triplc concession and land. But Malaysian investors are very simplistic, they just want to look at PE, Now Z1P3 earnings kicking in, then people start to buy because of low PE. Before that, they just can't see the intrinsic value. So I don't expect investors to fully appreciate triplc, that's why in this case I'm leaning towards realising the investment at a reasonable (not full) and certain value rather than betting on our investors starting to understand concession biz

4. With this bumper dividend, I think there is a high chance that most shareholders will vote for the deal. Puncak approval is not a big obstacle considering they just need 50% approval and they are already getting a good deal (some stuck-up shareholders finally realise that after seeing triplc earnings). So come monday it makes no sense for the share price to continue trading at such huge discount (>25%) to the disposal price anymore. This would be the reward for patient triplc shareholders

how many companies make >RM100m profit a quarter in similar commodity industry? I can only think of Press Metal which is making around RM150m a quarter. Profit 50% higher than Petron, lower than Hengyuan yet market cap is RM17bn vs Petron, Hengyuan RM3bn each

insas is a giant web of unrelated biz, a bit like bjcorp. the only thing I like is inari, other than that I think insas is a value trap

A conservative valuation:
Projected net profit RM400m, Free cashflow RM400m (usually FCF is even stronger than profit due to depreciation) EV/FCF 10x (Petdag at >20x, Litrak also >10x). Net cash RM200m (by end 2017, Jun-17 already RM90m).

Petron fair value now should be at least RM4.2bn or RM15.50 about 30% more return

Crest concession already finish construction, so it will be a cash cow but there won't be significant earnings contribution. The current profit is mostly construction and property, seems like a record year in the making

https://www.msci.com/eqb/gimi/smallcap/MSCI_Nov17_SCPublicList.pdf

guess whose name is included

https://www.msci.com/eqb/gimi/smallcap/MSCI_Nov17_SCPublicList.pdf

guess whose name is included

please see petdag operating profit and PBT. it's a fantastic result. it's not Petdag management's fault that investors pay 20x PE for their stock. but high benchmark means more room for petron to go higher

not for now. all other ideas pale in comparison with petron and hengyuan for the moment

petdag short inventory turnover also managed to improve PBT substantially, petron and hengyuan are going to earn bucketloads more

big buyers already coming in last week, now even ASB can't stop the momentum

haha lot of triplc critics now finally see the light and turned supporter

non issue for ekovest, whole proposal just a smoke screen.

the deal is subject to shareholders' approval and no way minority will approve it. ekovest and iwc have two very different sets and type of shareholders. plus most current iwc shareholders cost are higher than 1.50, so they are also reluctant to sell. lim kang hoo himself already said he's not selling

based on latest annual report, ekovest has more than 60 acres of land. if the news is true that property segment is injected to iwc, it should be a win-win. ekovest concentrate on construction and highway (and can get property construction project from iwc), iwc gets land which has immediate development potential up to RM8bn GDV (some without plans yet)

the only risk to this is if ekovest gets iwc shares instead of cash. iwc share price a bit too volatile and near term profit may not be great