huaan is a proxy for the current bullish steel sector. their product is a raw material for steel production. how sustainable their performance will depend on how sustainable is steel price

the way shares are gobbled up, seems like a new institutional buyer has emerged. no way retail buyers eat up like that

triplc still trading at a steep 30% discount over the cheap acquisition price (not to mention the real value), so triplc is still deep undervalued counter with good earnings prospects

I already highlighted before the deal is tilted toward the benefit of puncak, even MSWG said so
https://klse.i3investor.com/blogs/purelysharing/112371.jsp
https://www.mswg.org.my/sites/default/files/16.09.2017%20Newsletter%209%20September%202017%20to%2015%20%20September%202017_final.pdf

it does matter. if in the case triplc or puncak shareholders (until now I don't know why) reject the deal, then at least you know it's still an undervalued biz. so triplc by itself is fine, plus still 30% discount from disposal price. but puncak without triplc, I can only say good luck

results considered very good if you factor in raya holidays. plus now PE still <6 times, earnings will get progressively stronger before shareholders decide on puncak acquisition

company put 16c eps there to let investors speculate how much it is worth

Good article. Just to highlight a few things

1. I think Petronm capacity not sufficient to support the volume they sell so they have to source some from 3rd parties, which will reduce their margin
2. there may be some transfer pricing between refinery and marketing. sometimes it's also quite hard to distinguish between these two when both are under the same roof
3. Hengyuan is sourcing crude oil from shell for 5 years and its products are also mainly sold to shell malaysia for 10 years. the management team is also mainly from the shell days. so I think you are right to point out hengyuan is different from typical red chip

both petronm and hengyuan are good companies to ride this refinery upcycle

http://www.bursamalaysia.com/market/listed-companies/company-announcements/4233585

for new investors, adventa glove biz long time ago disposed already to aspion

to convert warrant to arbitrage, time is of the essence. and there's always risk when there's potential return. at least from technical point of view, trive seems still quite ok. fibo support at 21c, 18c and 16c. and bonus issue egm this friday. just for reference, not recommending anyone to punt

crazy market. news speculation already mention it's the privatised biz that could be top glove's target, doesn't belong to adventa anymore. wonder when punters will realise that

this stock I don't see much accumulating last time, so banker doesn't seem very ambitious. and the way they pull up the price so aggressively suggest they want to get out quick. most likely a short term spurt only, now will depend if their earnings can deliver. luckily I clear all already

this stock a bit too hot now. promoters conveniently forgot to mention that most of its biz is held by 70% owned subsidiary so not full net profit to them

put in simply, sendai has a poor track record in executing its contracts profitably. for construction companies, focus should not be on how much contract they win but how much they can earn from it

a friend raised an interesting point that fund managers are buying petron but not hengyuan because hengyuan is seen as a China red-chip company even though its refinery is in Malaysia and its largest customer is Shell Malaysia. once big fund managers wake up to that, hengyuan will get a massive re-rating

These should answer most of your warrant and call warrant questions

https://klse.i3investor.com/blogs/purelysharing/124972.jsp
https://klse.i3investor.com/blogs/purelysharing/125019.jsp

to be fair, EPF outsourced a lot of funds and different fund managers have different ideas. that's why you see sometimes EPF buy and sell the same company in the same day. it's not because EPF day-trade but are actually 2 separate transactions by different fund managers.

there are only a handful of companies that can give you extraordinary returns over long term. there are more companies that give you ordinary returns or destroy value over long term. so don't just blindly follow a certain way of investing without understanding the underlying rationale

Congrats to all shareholders. Seems like my previous RM13 target price wasn't that aggressive after all. those naysayers just missed easy 50% return in a few months, all because of bad attitude and unwillingness to learn. in life, these will cost you dearly.

now that petron has again broken out, wouldn't be surprising if Hengyuan will be following soon

my view is any appreciation of value would add to a company's value, but if it's operating assets that generate cashflow then it may not be straightforward. typical DCF is valuing cashflow plus value of non-operating assets. cashflow however could change depending on your assumptions. if you assume it has a shelf life, end of the day the higher land value should be taken into account. if you assume it's perpetual the asset value may not be apparent. but logically, everything has a useful life. if one day the cashflow returns from running the plant, after considering reinvestment is less than the land value or land converted for other use, then that's where land value becomes apparent. that said, hengyuan plant is still up and running so no point really shouting about land value

thanks Mr OTB. always good to have quality sharing

early signs do point to a good q3 but that said, there is no 100% certainty thing in investment. i read a good quote somewhere, investing is making probabilistic decision based on imperfect information on an uncertain future.

everyone can have different opinions but the opinions should be backed by sound arguments. explain why you think differently and I'm sure others will appreciate a different view. but most haters just nitpick, like whether Mr OTB has the right to post, just makes me laugh. that's between OTB and his subscribers, plus he did give his subscribers a few months advantage

i have also mentioned before it is natural for people to at least have a position before he/she promotes the stock. Why should the person give you free advice and some more have to fight with you to get in on the stock he/she thinks is undervalued or underappreciated? that's just idiotic and unreasonable expectations. as long as people put their money where their mouth is, I'm ok with it

haters gonna be haters. I also stopped posting at petron page after it is filled with haters who don't contribute anything yet are so happy when the price kept falling from 8 to 7. look where the price is now.

for risk management, key question is not how much will I earn if it goes up. the right question is how likely will it go down, and how my position would be affected. if you don't have an answer, you are better off without margin

at the end of the day it boils down to risk management. risk management does not mean don't take risk, it means taking sensible and profitable risk. say a few years ago if you use margin to trade the SPAC arbitrage, pay 5% interest but earn a high probability annualised return of >10%, that is good risk taking. if you use margin to follow hot stock tips then good luck.

thanks for the comments

@hng33 puncak is a riskier choice. if the deal goes though, triplc earnings can sustain them for the next 3 years but I'm not sure how huge their existing operations and new plantation losses will be. young trees literally gives no fruits and revenue in the first few years. if for some reasons the deal doesn't go through, triplc profit will remain strong but puncak will continue to slip into oblivion (which many puncak shareholders don't seem to understand). but I understand your trading rationale, just be aware of the risk

@PurplePain if you think it's fake then again it shows how limited you know, a reading of how IAS11 or IFRIC12 came about last time may broaden your narrow mind. personally not a fan of recognition only at completion, just make it difficult for investors to understand what is going on

@OOMMGG seems like you have some industry knowledge, do you mind sharing your source of shrinking of gasoline and diesel cracking margin? any news or links that we can refer to?

meanwhile, below is the Singapore gasoline crack spread, which seems to be going up instead of down. is this a rough guide we can rely on as reference?
http://www.cmegroup.com/apps/cmegroup/widgets/productLibs/esignal-charts.html?code=D1N&title=JUN_2017_Singapore_Mogas_92_Unleaded_%28Platts%29_Brent_Crack_Spread_&type=p&venue=0&monthYear=M7&year=2017&exchangeCode=XNYM

wow what is happening with this counter, up even when market is down. and anyone know why its LA is trading at a discount to the mother? shouldn't it be at a premium when it's convertible 1 to 1 to mother and carries fixed interest (7-8% a year) compared to hiap teck low dividend?

short term investors already spooked, long term investors can consider

construction companies some quarters just happen to have lower revenue due to work progress, over time will even out. company already said it's not due to seasonality, so best not to assume Q1 always be the weakest and Q4 strongest

those who shared great info here are going to get questioned when price comes down, but people forget what about when price was up? did they get paid when they recommended petron at below RM5?

it's the same thing like ekovest all over again when too many idiots crowd out the comment section and all the "I told you so/it's coming down/the company is a sham etc." when the price dropped.

maybe I should also leave the petron page temporarily before my IQ drops reading those comments

@cpng so you have no better ideas to share? I'm disappointed

1. what you said about oil price may be right, short term it is bearish, but what about 6-12 months down the road? or even longer, 3-5 years time? are you so sure it would stay around 40 then? the truth is no one knows for sure so stop acting smart

2. in case you still haven't realise (after so many people shared), oil price drop doesn't benefit or hurt petron directly. it's true the timing difference could affect them but to say they will be hurt like the upstream oil players (Hibiscus, Reach etc.) is simply ignorant

3.If my memory didn't fail me, Gdex and Karex even in better earnings time, never traded below 30 times PE (not to mention current craxy PE of 50-100 times) as people keep saying they deserve a premium (Singpost factor, e-commerce, largest condom maker etc.). are you really comparing them to petron's PE of 6 times? if petron PE is 30 times, now the price should be at least RM27

4. when it was 2.70 it was still making losses under Exxon brand, now EPS for the past 2 years are above 80c each year and last 2 quarter more than 40c each quarter, still RM2.70? if follow your kindergarten logic where earnings doesn't matter, Maybank was RM2 back in 2008, now is RM9.50, oh my gosh so overvalued? Top Glove IPO price 2.70, if you count bonus issue and share split, now adjusted price should be above RM100, wow the most overvalued stock! since I have pointed them out, if you really have faith in your logic, please go to Maybank and Top Glove page and tell the shareholders and analysts how overvalued their company is. whoever that speaks against you is definitely insincere

I don't usually name-call but when you doubt others yet cannot back it up with evidence or logical reasoning, then you deserve it. some people it's better for them to stay mysterious and not to explain themselves, because once they open their mouth then you know it's rubbish

I agree it's stating the obvious, but very few people manage to practice it in life

for a good company, if you can sell at high and buy back at low, that's the most ideal investing strategy. over the years, however I realise the returns I miss is much higher than trying to time the market this way. but that's just me, there are a lot of young genius nowadays, maybe they can time it correctly that's up to them

@cpng how about share your expert view on global strategy, world oil market and to what extent it will affect petron earnings in the next 12 months? while you are at it, maybe also share by what measure petron is overvalued now? that would help a lot of people

as I have pointed out many time, 40c eps a quarter is a bonus, not a staple. do you really expect to buy a company earning RM1.60 eps a year at RM8?

assuming a benchmark PE of 10 times (actually with petron strong cashflow, I think it deserves higher), current market is pricing in an eps of around 70c, which means 2Q-4Q average 10c per quarter, up to you if you think it's fair.

as the sentiment turns more bearish, petron is not your stock if you need to make quick money by next week or next month.
will crude oil stay low or go down further? maybe, but don't forget Aramco listing is coming up soon and the guy who promotes Aramco listing just became crown prince of Saudi Arabia. it's essential for crude price to be higher to get a good IPO valuation

as the price goes lower, the potential reward to risk just gets higher. those who have a stronger risk appetite and stomach can consider collecting batch by batch. who knows there may be more people who are willing to throw at lower price, haha

haha some jokers spreading rumours that crack spread is falling, in fact it's expanding based on the data my friend just sent me. anyone with a bloomberg machine can corroborate it

I can excuse someone who does not know which crack spread to use since there are so many in the market (that's why I show a few usually as reference) but like what probability rightly point out, the chart the joker use shows the spread highest in 1Q16 and much lower in 4Q16 when petron and hengyuan clearly shows the opposite, that shows the blogger is either lazy or has a sinister motive

it's true that when crude oil drop, the time lag could be a drag in its profit (assuming refining margin stays the same), that is a fair point. but to mislead with a clearly wrong crack spread chart is inexcusable

http://www.straitstimes.com/singapore/health/two-new-zika-cases-at-kensington-park-drive

I suspect the selldown is because people are speculating that petron might earn lesser compared to last quarter as the oil price is on a downtrend, but definitely overreacting. it's all about expectations, if you are expecting 40c eps every quarter, you are bound to get disappointed, if not next quarter then the quarter after next. but if you look at the longer term, each year RM1-1.20 eps, excellent cashflow and balance sheet, then you won't panic when price come down.

this drop is nothing compared to not long ago when petron-cb dropped from more than 50c to 25c, hehe

for some people, only old man kyy is their golden rule (almost like an obsession). whatever kyy buys, they buy. whatever kyy don't buy, they don't buy. they forgot kyy has a lot of money to lose, they don't

For the 5c gross profit, I think it's fixed under the APM scheme. So even if your revenue falls (same volume, lower petrol price), the gross profit should stay the same, GP margin might look better in %.

They are not only selling petrol though. They still have refinery, LPG and jetfuel biz, plus inventory gain/loss effect. So it won't be that straightforward. but I suppose petrol volume x 5c would be a staple gross profit for them, a base for them to build on

funny psychology. everything is rosy when price shot up and now everything is bleak when price come down. that's why most investors always buy high sell low

10% monthly is nothing really, but 10% on a million dollar fund is really something. anyone can get high returns at some point of time, but whether she can keep it up over a longer period that's the question. without other source of income, if market turns bearish then she could get into trouble. full time trading is only recommended if you can prove yourself over say at least 2-3 years

market is not mature yet. the returns offered do not sufficiently compensate for the risks

as most investors have limited capital, just remember to factor in opportunity costs

reading the article and comments trigger some thoughts

1. most of those who kept talking about biz sense has no idea what it means. if all business owners have biz sense we wouldn't see so many loss-making companies in Bursa. as investors have limited info and access to mgmt, the tried and tested way to gauge a management's quality is still through their qualification and track record.

2.investing (FA) vs trading (TA) has existed as long as investing has been around. I have seen practitioners of both disciplines done well so I'm not against either approach but one should not mistake one for another. kc is clearly talking about FA here but many others keep talking TA with "biz sense" as disguise.

3.many still cannot differentiate between investing/trading or stock price vs value. Some companies are suitable for long term investing while some just for short term trading. and rubbish companies don't turn good just bcos the share price went up, vice versa.

4. if you trade on a rubbish stock which price went up and you exit with a profit, congrats as you time the market right this round. repeat the trading enough times without clear risk reward management plan, you would soon join the herd who keep complaining that stock market is just a lie that cheat people's hard earned money

5. the most difficult thing about stock returns is not about how high % return, but consistency. why warren buffett is regarded as the greatest investor when he only generates slightly above 20% return a year? many in any investing competition would have beaten buffett hands down this year but can they repeat this return over 50+ years? gaining 50% a year and losing 50% the next year actually gives you 25% loss whereas someone who makes 10% a year would have made 21% return

in summary, kc is trying to teach the youngsters nowadays about long term fundamental investing principles but most are just interested in making a quick buck in the next week or month.

to kc, I share your experience. sometimes pointing out a lemon does makes lemon owners irritated. but as long as someone learns something or save him/herself from that lemon after reading your article, that would make it worthwhile. cheers

the most important rule in investing/trading, know what you are doing. if you are unclear, please seek help or just avoid it, no matter how attractive the potential returns are

2 for 1 exchange ratio

@yoloisreal say a warrant is 2 for 1, if the premium is maintained, every 2 sen movement in mother the warrant should move 1 sen. so if 1% of mother now is 5 sen, warrant technically should move 2.5sen, so you divide 2.5sen over current warrant price to get the % movement.

in real life, all price movement is subject to supply and demand so premiums will fluctuate constantly

yes, like what kcchongnz has mentioned. don't forget your last trading day is 3 market days before expiry. so last 3 days your hands are tied and can only watch on the sidelines

@Dragon88 just to elaborate on my point, imagine if a stock trading at RM1.50, exercise price RM1, exercise ratio 1 to 1. the warrant trading at RM0.60 or 6.7% with 1 month to expiry. if the stock held steady at RM1.50, the warrant value will slowly trend down toward RM0.50. If you hold until expiry, you are expecting stock to trend above RM1.60. say if it close at RM1.58 on last day, your warrant eventually only get RM0.58 even if it ends up in the money. anything below the breakeven price of RM1.60 at expiry it is better for you to sell the warrants earlier.

if you are interested on the topic on options time decay, you can google it. my general advice is don't hold until expiry unless you are reasonably quite sure.

@kcchongnz thanks for the comments. yes call warrants are more speculative, that's why I mentioned the company you like must have price appreciation potential in the short term. even though FA sometimes teach you to go contrarian, never do that when you buy call warrant. do not go against the trend.

however if you buy a call warrant that expire in 6-9 months, you should go through at least 1 or 2 quarterly earnings and if they are good, then the price will move. for beginners especially should go for longer expiry as possible to buy time

my TA is not that strong, so I perfer to rely more on FA. with good FA support, even if the price doesn't go up, it shouldn't fall too much, so my risk reward ratio is effectively higher.

@Dragon88 I don't think there is any costs involved if you hold it till expiry. You will only incur the brokerage costs when you bought it earlier. However, it's best to confirm with your brokers as things may have changed over all these years. I have never held a call warrant till expiry because like I mentioned, premium would collapse in the last month. most call warrants expire out of money. It's usually better if you sell it earlier, unless you are very sure something big will happen in the last month before expiry.