Posted by bonaventure > Nov 1, 2013 11:24 PM | Report Abuse
Dear kcchongnz, I noticed that the CFO of Plenitude has resigned today from Bursa announcement - after less than 3 months in its position. Furthermore this is the second CFO to resign in just within a year. I am getting nervous now as would it be the chairwoman is very difficult to get along with or the CFO smells anything fishy. Appreciate it if you could share some of your view on this.

I really don't know anything why the CFO resigned. How would I know? Employee comes and goes. Good employee looks for better offer somewhere, bad one may find himself ignored in the company and hence resigns. All sort of reasons.

The last time I remember I sold a stock named Coastal Contracts at about 2.00 because its financial controller resigned. Look what is the share price of Coastal now.

So now I concentrate on the value of the company and compared with its stock price. Plenitude has huge amount of cash. It also has a lot of quality assets which many of them have not been revalued for decades. Even ignoring the undervaluation of its assets, its Graham net net valuation shows that it is hugely under-priced at present price. Read my valuation as shown in the link below:

http://klse.i3investor.com/servlets/forum/600036493.jsp

chang0509, I have commented on Parkson some time before as shown in the link below:

http://klse.i3investor.com/blogs/in_search_of_excl_kcchongnz/34631.jsp

My opinion has not changed since then.

Parkson made tons of money in China before the US sublime crisis and the slow down of Chinese economy. Hence if the China business recover, I am sure Parkson will do very well.

Is Muda Holding that great?

Posted by winniechan > Nov 1, 2013 11:20 AM | Report Abuse
Kcchong, how about Muda? With a profit of Rm26.751 million and NTA Rm2.05 per share, is it worth collecting ?

Based on last year's result, at 88 sen, PE ratio is 17, certainly not low, and P/B of 0.43 which is low. Is it worth investing?

First we need to determine if Muda is a great company. The net margin of its paper business is very thin at just 2%. Its ROE and ROIC is hence low at only 3.4% and 1.4% respectively, which are poor. Its export business has been slowing down considerably recently. Hence I don't see any moat in its business.

Its cash flow from operations is good. However, it requires a lot of capital investment. Hence it has little free cash flow. FCF amounts to about only 2% of revenue and invested capital, lower than my minimum of 5%.

Balance sheet wise it doesn't look good. It has huge amount of debt, totaling 480m, or with a debt-to-equity ratio of 0.8, which is high. Though its net asset is high in relation to its market capitalization, the asset quality is poor with most of it in PPE, inventories and receivables.

The only bright side is its high dividend yield of 6%. However, this high dividend is not paid from the free cash flow of the business, but from sale of assets.

Hence for me I would avoid investing in Muda holding.

Tan KW, thanks again for posting this.

Actually Insas has been buying back shares all these years and share dividends were given to shareholders. This is actually the same as cash dividend but in another form, although it doesn't appear to be that 'tangible" to the shareholders as compared with cash dividend.

Insas if looked as a Graham net net play, it is really very undervalued. If the undervaluation is "unlocked" somehow, there may be great future for its shareholders.

http://klse.i3investor.com/blogs/stock_pick_challenge_2013_2h/36493.jsp

Professor Eugene Fama of the University of Chicago is one of the three economists to be awarded the 2013 Sveriges Riksbank Prize in Economic Sciences for his ground-breaking work advancing the Efficient Market Hypothesis (EMH).

The EMH postulates that in an efficient capital market, current market price reflects all available information about a security and the expected return based upon this price is consistent with its risks. As a result, it is impossible for an investor to consistently beat the market and profit from it, unless he takes up more risks.

The Fama three-factors model expands on the capital asset pricing model (CAPM) by adding size and value risk factors in addition to the market risk factor in CAPM. This model considers the fact that value and small cap stocks outperform markets on a regular basis because of these additional risks. The stock return equation, r, is written as follows:

r = Rf + β*(Rm-Rf) + bs*SMB +bv*HML + α

Where Rf is the risk free rate, Rm is the market return, SMB is Small minus Big market capitalization, HML is the High minus Low book-to-market ratio, bs and bv are the respective coefficients as obtained from regression, α is a random number.

This model claims that when the risks in the size and value are considered, the vast majority of returns are explained. Excess return or alpha just about completely disappears when a portfolio measurement accounts for the average size and value weights of the holdings. No longer can anybody claim credit for unexplained excess results that occur simply because he held a portfolio tilted toward small or value.

Let us look at the portfolio of kcchongnz and see if the claim that the excess return in the order of 24.2% in three months is really due to the additional risks incurred.

1. Do the stocks in the portfolio have historically high volatility as measured by β as in CAPM?
The 11 stocks in the portfolio are hardly researched by investment houses, especially when they are first selected into the portfolio. More than half of them have no research report from any investment bank. Others have only one or the most two research houses covering them. There is hardly any institutional investors owning their stocks. There are also few retail investors invested in those stocks and hence not much trading on them. My hunch is that the values of β are mostly smaller than 1 if one cares to regress the return of their stock prices against the return of the market.

2. Does the portfolio consists of mostly small market capitalized stocks?
For sure it is. None of the stocks in the portfolio has a market capitalization anywhere close to one billion Ringgit. Only a couple of them, Kumpulan Fima and Daiman have slightly above 500 million market capitalization. Fibon’s market capitalization was just 32.3 million and Datasonic just migrated from the ACE market to the main board when they were first written. But are these stocks more risky as postulated by the 3-factor model?

The stocks were picked based on their good and consistent earnings, healthy balance sheets and good cash flows. After determining that those companies are good companies based on fundamental metrics, they were purchased at reasonable price or even way below their intrinsic values. Many of the companies selected have heaps of cash and little debts, if any. So how could they be more risky just because they have small market capitalization and warrant higher risk premiums?

3. Does the portfolio consist of mostly high book-to-market ratios?
In the first place, the stocks were selected as explained in the last section, i.e. good and consistent earnings, healthy balance sheet and good cash flows sold at a comfortable margin of safety in relation to their intrinsic values. But why is it considered as higher risk for stock with a higher book value than the market value? Isn’t that safer to buy stock with a higher book value than the market value?

A review of those stocks in the portfolio shows that a mixed bag of high and low book-to-market ratios and hence the 3-factor model doesn’t seem to apply.


The portfolio out-performed the broad market by a whopping 24.2% in three months. From the argument above, it doesn’t appear that the portfolio consists of stocks of higher market risk as measured by β.

It does appear to confirm that small market capitalization and good value (not necessary book-to-market ratio but other value metrics) may explain the excess return. However, it beats me to think that small market capitalization and good value carry additional risks and hence the explanation of excess return.

So is the market in Malaysia efficient? Does the excess return due to the additional risks carried? For me I highly doubt so.

Exactly three months have passed since I first started my portfolio for the second half of 2013 as proposed by some of the forumers here. May be we should review the performance of the portfolio in this three months.

Just to recall, all stocks in my portfolio are small to medium capitalized stocks. They were chosen based on the good past performance using the metrics of value investing such as return on invested capital, return of equity, good and quality earnings as evidenced from cash flows, healthy balance sheet etc. After determining that they are of good companies, their values were assessed against their share prices at that time. Attempts were made to buy those good companies at reasonable or bargain prices basing on PE ratio, Price-to-book etc, and especially their earnings yields from the metric of Ebit/EV.

In this three months, KLCI has risen from 1773 to 1810, or 2.1%. but what is the performance of the portfolio?

kcchongnz's portfolio has gained an average of 26.3% in the last three months. That means the portfolio has returned an alpha of 24.2% using the KLCI as a benchmark. Ten of the eleven stocks made positive return with more than half of them in double digit percentage. They are Datasonic (92.2%), Fibon (81.8%), Pintaras (27.9%), Homeritz (26.7%), Willowglen (21.7%) and Daiman (16.2%). There is no loser with the worst performer, Kumpulan Fima which breaks even. Details of the return of the portfolio is shown in the link appended below.

http://klse.i3investor.com/servlets/pfs/19386.jsp

How is the three month performance of the portfolio against the 68 unit trust funds invested in Malaysian equity as available in the FundSupermart as shown in the link below?

http://www.fundsupermart.com.my/main/fundinfo/compareFund.svdo?sectormaincode=EG&sectorareacode=FE2

The median return of the 68 funds is 2.0% (approximately that of broad market) with the maximum return of 7.5% achieved by Apex Dana Al-Sofi-i.

This means that the return of my portfolio also way outperformed the unit trust funds by a very wide margin.

Appendix: kcchongnz portfolio
xxxx Ref date Now xxxx xxxx xxxx
New 1/08/2013 1/11/2013 xxxx xxxx xxxx
Pintaras 4.990 6.380 0.000 1.390 27.9%
Kfima 2.060 1.980 0.080 0.000 0.00%
MFCB 1.700 1.830 0.030 0.160 9.41%
Haio 2.670 2.780 0.000 0.110 4.12%
Fibon 0.330 0.600 0.000 0.270 81.8%
CBIP 2.830 2.950 0.000 0.120 4.24%
Tien Wah 2.510 2.550 0.077 0.117 4.68%
Homeritz 0.430 0.535 0.010 0.115 26.7%
Willow 0.530 0.645 0.000 0.115 21.7%
Daiman 2.530 2.940 0.000 0.410 16.2%
Datasonic 3.350 6.440 0.000 3.090 92.2%

Average xxxx xxxx xxxx xxxx 26.3%
KLSE 1773 1810 xxxx 37.0 2.09%
Alpha xxxx xxxx xxxx xxxx 24.2%

Exactly three months have passed since we first started our portfolios. May be we should review the performance of our portfolios now.

In this two months, KLCI has risen from 1773 to 1810, or 2.1%. but how have our portfolios performed?

kcchongnz's portfolio has gained an average of 26.3% in the last three months. That means the portfolio has returned an alpha of 24.2% using the KLCI as a benchmark. Ten of the eleven stocks made positive return with more than half of them in double digit percentage. They are Datasonic (92.2%), Fibon (81.8%), Pintaras (27.9%), Homeritz (26.7%), Willowglen (21.7%) and Daiman (16.2%). There is no loser with the worst performer, Kumpulan Fima which breaks even. Details of the return of the portfolio is shown in the link appended below.
http://klse.i3investor.com/servlets/pfs/19386.jsp

What about Ooi Teik Bee's portfolio return?

Ooi Teik Bee's portfolio returned a respectable 14.4%, or an alpha of 12.3%. There are 7 winners and 3 losers. Its big gainers are all warrants, some leveraged instruments. They are Hap Seng warrant (63.5%), LBS W (62.2%), Punchak warrant (42.4%). It has some double digit losers through Lii Hen and Triple, both at a loss of 18.9% .

The performance of both the portfolios exceeds the return of the broad market by a wide double digit margin in the last three months. The performance of each portfolio may not be comparable as one portfolio was constructed using fundamental analysis for long term investing, whereas the other used technical analysis and may involve frequent trading.

Appendix: kcchongnz portfolio
xxxx Ref date Now xxxx xxxx xxxx
New 1/08/2013 1/11/2013 xxxx xxxx xxxx
Pintaras 4.990 6.380 0.000 1.390 27.9%
Kfima 2.060 1.980 0.080 0.000 0.00%
MFCB 1.700 1.830 0.030 0.160 9.41%
Haio 2.670 2.780 0.000 0.110 4.12%
Fibon 0.330 0.600 0.000 0.270 81.8%
CBIP 2.830 2.950 0.000 0.120 4.24%
Tien Wah 2.510 2.550 0.077 0.117 4.68%
Homeritz 0.430 0.535 0.010 0.115 26.7%
Willow 0.530 0.645 0.000 0.115 21.7%
Daiman 2.530 2.940 0.000 0.410 16.2%
Datasonic 3.350 6.440 0.000 3.090 92.2%

Average xxxx xxxx xxxx xxxx 26.3%
KLSE 1773 1810 xxxx 37.0 2.09%
Alpha xxxx xxxx xxxx xxxx 24.2%

A 56 m piling contract! Nowadays the contract work for piling is really huge compared with say 20 years ago. Those days a 10m contract for piling works was one of the biggest one.

The Board of Pintaras Jaya Berhad ("PJB") is pleased to announce that the Company's wholly-owned subsidiary, Pintaras Geotechnics Sdn. Bhd. has, on 29th October 2013, received a Letter of Award dated 7th October 2013 from Tristar Acres Sdn. Bhd. to undertake piling works for a proposed mixed development project at Kg. Sg. Buah, Mukim Dengkil, Daerah Sepang, Selangor Darul Ehsan. The said works is to commence in November 2013 with a completion period of 14 months. The contract is valued at RM59 million.
The said contract is expected to contribute positively to PJB Group's future earnings.

I don't normally get excited when a big contract is secured by a construction firm because a big contract doesn't mean big profit. but for Pintaras with its niche market in foundation work, it is exciting.

With Pintaras's average net profit margin of 30%, the net profit comes to about 16.8m. It is about an earnings of 21 sen per share, just for one project. So how not get excited?

This is the kind of attitude an investor, I mean a true investor must have.

Posted by haikeyila > Nov 1, 2013 09:33 AM | Report Abuse
if insas was so good, surely the fund managers have jumped in long ago? yes, the lack of a divvy is a put-off, but there must be something about it that we don't know? recent price increase seems to be caused by buybacks.



Just like what this famous investor says here:

"When you locate a bargain, you must ask, 'Why me, God? Why am I the only one who could find this bargain?'" - Charlie Munger

So haikeyila, why do you think the company wants to buy back its own shares then? What else do you think there is a catch here?

How about Insas?

Posted by saloma > Oct 31, 2013 10:23 PM | Report Abuse
how about INSAS? it seems its value should be higher than current price..?

A classic Graham net net play. See link below:

http://klse.i3investor.com/servlets/forum/600036493.jsp

Insas and Graham net net

In 1932 at the bottom of the Great Crash, Ben Graham wrote an article on Forbes about the cheapness of the market and how companies are being quoted in the market for much less than their liquidating value, as if they were all destined to be doomed. He called these types of stocks, "net nets", companies that sell for less than its net current asset value, or net net working capital. Graham used the following formula to compute the liquidation value of a company.

Net Net Working Capital = Cash and short-term investments + (0.75 * accounts receivable) + (0.5 * inventory) – total liabilities

It's the lowest form of valuation you could possibly do because it ignores everything about the business and just focuses on tangible assets. The formula states that;
• cash and short term investments are worth 100% of its value
• accounts receivables should be taken at 75% of its stated value because some might not be collectible
• take 50% off inventories, due to discounting if close outs occur

Insas’s latest balance sheet as at 30 June 2013 was used to compute the net tangible asset and Graham net net values. Besides cash, the net net values of quoted and unquoted investments owned are also taken as 100% of the book value. Note that tax assets, property, plant and equipment, Goodwill and “other assets” are taken as worth nothing.

The appended table shows that the Graham net-net value of Insas is RM1.23. This is more than twice its closing price of 64 sen on 30 October 2013.

Besides Insas has been profit averaging 6 sen per share for the last 10 years. It has on average positive free cash flow and a healthy balance sheet.

Why is Insas trading at such a big discount to its Graham net net value? I guess is investors have not much trust in the management in maximizing minority shareholder value. No dividends have been declared until recently, although it has been buying back its shares. So with the beginning of this more tangible dividend distribution, will Insas be re-rated in accordance with its value?

Insas Graham net net
Cash and equivalent 532,894 100% 532894
Investments 120,290 100% 120290
Investment properties 151,432 100% 151432
Associate companies 90,145.63 100% 90146
Receivables 345,289 75% 258967
Inventories 15,830.73 50% 7915
PPE 59,765 30% 17929
Other assets 43,503 0% 0
Total assets 1,359,150 xxxx 1179574
Total liabilities -325,949 100% -325949
Net assets 1,033,201 xxxx 853,625

No. of shares 693,334 xxxx 693,334
NAB 1.49 xxxx 1.23

A story that Graham told.

[Let me tell you the story of the oil prospector who met St. Peter at the Pearly Gates. When told his occupation, St. Peter said, “Oh, I’m really sorry. You seem to meet all the tests to get into heaven. But we’ve got a terrible problem. See that pen over there? That’s where we keep the oil prospectors waiting to get into heaven. And it’s filled—we haven’t got room for even one more.”

The oil prospector thought for a minute and said, “Would you mind if I just said four words to those folks?” “I can’t see any harm in that,” said St. Pete. So the old-timer cupped his hands and yelled out, “Oil discovered in hell!”

Immediately, the oil prospectors wrenched the lock off the door of the pen and out they flew, flapping their wings as hard as they could for the lower regions. “You know, that’s a pretty good trick,” St. Pete said. “Move in. The place is yours. You’ve got plenty of room.”

The old fellow scratched his head and said, “No. If you don’t mind, I think I’ll go along with the rest of ’em. There may be some truth to that rumor after all.”]

Posted by mlg123 > Oct 31, 2013 07:00 PM | Report Abuse

i think the whole year earning is bump up by disposal of land in KL. without that one off gain, the earning for the whole year is less than previous year. Well, intrinsic value is quite subjective and the share price may never reach its intrinsic value. therefore might end up holding the share forever. what is your opinion?

Intrinsic value is subjective? Share price never reach intrinsic value? Definitely! That is why when you decide to buy, you must have an adequate margin of safety. And when the share has gone up near to the intrinsic value, you sell. That is because there are many ways your assumptions in deriving the intrinsic value may be wrong.

‘In the short run the market is a voting machine; in the long run, it is a weighing machine.’ Benjamin Graham

Is Focus Lumber a good company? Is it worth investing?

I have not studied those stocks before you mentioned here. But since you ask, I will try to look into one of them. I will give my opinion if this is a good company worthy of investing.

Focus Lumber Berhad is engaged in the manufacturing and sale of plywood, veneer and laminated veneer lumber (LVL), and investment holding. The Company mainly produce thin panel plywood, of which the thickness is below six millimeter (mm) and are capable of further processing by laminate factories. It also produce thick panel plywood ranging from 6 mm to 18 mm.

The business is cyclic in nature and it appears to be good this couple of years although there is sign that it is slowing down.

It's business has a high net profit margin of about 10% and provides a return of 14% (>12%) of invested capital. The quality of its earnings is good. Free cash flow is abundant at more than 10% of revenue (>>5%). It has plenty of cash, amounting to 57 sen per share with zero debt and hence a very safe company to invest in. The only shortcoming is its business is quite stagnant with not much growth.

At 81.5, its PE ratio is 7.3 (<10), EV/Ebit=3.0 (<8) and price-to-book of 0.7 (<1). So it is not expensive and hence may offer investors a good investment.

Posted by mlg123 > Oct 31, 2013 05:00 PM | Report Abuse
kc,
i think the difficult part will be to decide at what price to sell plenitude? one part is the company nta is > RM3.30 excluding amy rev-valuation of its landbank.
on another side the earning of the company is no able to justify share prices of RM3.30 as it P.E will be high. As Plenitude doesn't have big funds such as Aberdeen, what is your opinion on the exit price?

I thought Plenitude earned 19 sen per share last quarter, and 29 sen for the whole year? Isn't that reasonable good earnings for a price of Plenitude at 2.62? Not forgetting that it has an excess cash of RM1.44 per share.

When to sell? Isn't it easy to decide if you know the intrinsic value of Plenitude?

A tale of two corps and one Con

Posted by kcchongnz > Oct 24, 2013 04:10 PM | Report Abuse X
A tale of two corps
Someone questioned me why I did not follow the hype on MP Corp when it was about 54 sen and instead interested in this fallen angel PM Corp.
Just 5 weeks ago MP Corp was trading at about 50 sen and PM Corp 15 sen. Now PM corp price has risen by about 70% to 25 sen and MP corp fallen by 2 sen or 4% to 48 sen.
Sometimes really have to depend on luck. Or is it?

Posted by kcchongnz > Oct 24, 2013 04:48 PM | Report Abuse X
Yeah many argument about whose stock is better. The other one is AncomLB. Non-stop arguing. % weeks ago it was 17.5 sen. Now it is 18 sen. Gone up also by half a sen or 0.6%.
Whereas PM Corp now at 25 sen has gone up by 70% in the same period.

Another week has passed. And now PM Corp share price has risen to 28 sen, or another 12%. What about MP Corp and PW Con?

MPCorp has fallen another 2.5 sen, or 5% to 45.5 sen. PW Con still stay at 18 sen.

Posted by davidkkw79 > Oct 31, 2013 04:59 PM | Report Abuse
Dear Kchongnz, yes I have sold it out at 2.32 then switch to Malton !
I've lost the money which I should earn in plenitude....so sad.
But nvm, since I switch to malton, I believe this stock will be more power and high volume. It should can goreng up to RM 1.80 !
Marilar join kita pergi goreng Malton !

How come you are so sure that it will be gorenged up to 1.80?
Who will goreng that up for you to make money?
So you will be the winner, but who will be the losers?
What will support Malton's price of 1.80?
Why Malton?

So davidkkw79, have you sold your Plenitude at 2.32 a week ago? It is 2.62 now.

Posted by davidkkw79 > Oct 23, 2013 09:56 AM | Report Abuse
iafx, what you abuse on Kchongnz is true ? then I think I better cabut first, bfore this stock going to holland....

Posted by davidkkw79 > Oct 25, 2013 12:13 PM | Report Abuse
Going to holland now !

Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Genting.

Paul Samuelson

Want to discuss about efficient market hypothesis? Any time!

Are you confused with what is price Vs value?

Price is what you pay. Value is what you get. Warren Buffett

If you refer to the portfolio set up less than 3 months ago below, the average price change is +22%. Does it mean that the average value of the companies has improved by 22% compared to 2.54% of the broad market in the same period? Yes, I never expect the stock prices moved up that fast. Fundamental investing is of a long term endeavour.

http://klse.i3investor.com/servlets/pfs/19386.jsp

6 out of the 11 stocks have abnormal return of >10% in 3 months, with Pintaras 26%, Fibon 80% and Datasonic 82%. Does it mean that their company business has grown by that magnitude?

Of course not. The price has grown by that amount but not the business of the companies. So why are the prices of the companies increased so much in such a short time? Speculations? The management or insiders frying the stocks? How do you know? Any evidence? I don’t know.
Or is it because there are big discrepancies between the prices of the stocks and the intrinsic values of the companies in the first place?

Is it because few people pay any attention to the undervaluation, if any, because these are mostly low capitalized stocks which no institutional investors, and few retail investors look at them.

My analysis and valuations of those stocks did show that there seem to be such big discrepancies. Is it because the prices are moving towards their intrinsic values? But again financial statement analysis and valuation is an art.

Most of the professors in Finance are just wage earners, earning enough but not rich. This is because they all believe in the efficient market hypothesis fervently. Hence they just invest in index funds, ETF and earn slightly below market return.

I know this for sure.

The other KC, thanks for the correction. Warren Buffet may have a master, but the principle he uses in investment is very basic which everybody can use, provided he has the discipline.

What I mean is that the management of a company needs not have high academic qualifications. All I want for the quality of management is credibility, candid, shareholders focus, concentrate on doing the business rather than speculating the share price of the company.

Who doesn't want abnormal return whether it is short term or long term?

Speculation for Fibon? I don't know but what is your basis of saying so? Just because you think the directors do not have a string of qualifications behind their names? Or is it Fibon's earnings is little or its assets or cash flows are not justifiable for its price now?

For your information, Warren Buffet does not have any MBA or PHD behind his names. People like Steve Job, Bill Gate, Mark Zuckerberg do not even have a basic degree.

I have done thorough analysis on Fibon in my pick. Do you have anything comments which you think my analysis is wrong fatally?

anbz, if you are not interested in a particular stock, it is more productive you spend time scouting for good stocks to invest, rather than harping on something you have no interest in.

However it is also good you alert others on something others should be careful of, but provided those things you talk about are relevant ones.

Just reiterate that the pick of Fibon is by houseofordos. I just wrote up the analysis. I must thank him too. I must also thank him for alerting Hexza to me a few days ago. Hope house you also make money from Hexza.

Posted by bsngpg > Oct 28, 2013 04:37 PM | Report Abuse

CAR :
Hi KC Chong 大佬: I would appreciate if you can be patient(as I am slow) and willingly to guide me further on the below :

1)Now I know how to calculate CAR. Thks.

Q1 : After calculating CAR of each transaction for the last 20 years, can I average CAR of all trx to get grand CAR? Example trx #1(hold for 3.55 yrs) : CAR-11.9%, trx 2(hold for 1.68 yrsr):CAR+28.8%, trx#3(hold for 0.49yrs):CAR -62.8%. Average Grand CAR-15.3%.

NO, YOU CANNOT AVERAGE THE CAR UNLESS ALL YOUR STOCKS ARE OF EQUAL WEIGHTING. GET THE ABSOLUTE QUANTUM OF EACH STOCK FOR EACH PERIOD, ADD THEM ALL UP FOR EACH PERIOD, AND THEN DO THE CAR AS NORMAL WITH THE TOTAL AMOUNT FOR EACH PERIOD.

Q2: Very short holding period : GTronic, Bought on 16Jan06 @RM1587 and sold on 20Jan06@RM1662. No of Year=0.01096. CAR=6600%. If I include this 6600% into the calculation of grand average (as Q1 above), the grand average is distorted. How should I deal with this?

THAT IS WHY YOU CANNOT USE THE AVERAGE UNLESS THE WEIGHTING OF EACH STOCK IS THE SAME. AND ALSO FOR SHORT PERIOD OF HIGH RETURN AND IF YOU ANNUALIZED (OR CAR IT), IT GIVES YOU A DISTORTED INDIVIDUAL RESULT TOO. THIS IS BECAUSE YOU CAN'T GET THE SAME ABNORMAL RETURN FOR THE REST OF THE YEAR.

Q3: Very low denominator (分母) : Notion WB(free, I assigned RM1 to it), 27Apr12-28Oct13: No of Year=1.50. CAR=10434%. Same as (as Q2 above), if I include this 10434% into the calculation of grand average (as Q1), the grand average is distorted. How should I deal with this?

SAME AS ABOVE, YOU CANNOT AVERAGE THE CARS. YOU SHOULD ALSO IGNORE THE ABNORMAL ANNUALIZED SHORT PERIOD RETURN.

Q4: Same case on bonus share which I did not apportion back to the mother shares thus the purchase cost of the free bonus is assigned RM1 and CAR is in thousand. How should I deal with this?

SAME ANSWER. FREE BONUS IS FREE, NO COST. FOR EXAMPLE IF YOU BUY 2000 SHARES OF STOCK A AT RM1, AND YOU GET ONE BONUS FOR TWO STOCKS HOLD, YOU COST OF THE 3000 SHARES NOW IS 2000/3000, OR 0.67 PER SHARE.

Thank you

Don't know when Kenanga or TA will revise their target price of Fibon say with a revised PE of 12.54 instead of 7.6.


10/09/2013 0.325 0.40 +0.075 (23.08%) TRADING BUY KENANGA Price Target News
15/08/2013 0.38 0.37 -0.01 (2.63%) SELL TA Price Target News

Investing all your money in one or a few counters is certainly not a wise move in my opinion, theoritically as well as practically for an ordinary investor. Don't put all your eggs in one basket is always a wise maxim.

My opinion is pie is the best choice at the moment.

Oh forgot, I don't trust all the chinese companies accounts though.

Well all has certainly created a lot of wealth for shareholders. One may be a little late now to invest in wellcall as I always think a great company may not be a good investment if the price is not right. have commented on csc before here, basically same opinion as bsngpg. Tong herr I don't know anything.

To me I don't stereotype nationality, race etc and make judgement of their credibility. But if you are not comfortable with the management, which to me is also very important, don't invest in the company. Move on.

Tony, notice I never talk about trading. I only talked about fundamentals, financial statement analysis and interpretations, valuation and margin of safety. Occasionally stock price and return are mentioned when provoked.

I am a poor trader.

Posted by JCool > Oct 26, 2013 10:26 AM | Report Abuse

But tis fellow is too much la.....

>Kcchongnz..... Stock: [PMCORP]: PAN MALAYSIA CORPORATION BHD Oct 22, 2013 08:09 AM | Report Abuse MESSIBARCA, Yes, I have bought PM Corp, not only for myself, also for my sister-in-law and nephew, and my two children who asked me to invest for them. Actually I have been telling my daughters concentrate on their career and to safe and invest.

It is still a small part of my portfolio. No need to update my portfolio in i3. The portfolio changes too from time to time and it is not stagnant, especially when I find something else which is better.

RECKLESS RECKLESS.. invest other peoples' money in a BUY TODAY SELL TOMORROW counter...

Pmcorp price has gone up cos WHEN D LIQUIDITY TIDE RISES ALL BOATS R LIFTED n d Sing dollar has done its job ... yet tis fellow is putting in other peoples money into it....

BETTER DISCOUNT WHATEVER HE IS SAYING BY 75% TO AARIVE AT ACTUAL FAIR VALUE


Reckless? Buy pmcorp at 15 sen five weeks ago and it's price now is 25 sen. This is a rise of 70 pct! Reckless? Reckless in making 70. Pct in 5 weeks?

How is it. Or pared with the way overvalued ancomlb 5 weeks ago at 18 sen?

Jcool seriously what are you trying to prove? Haven't you read my post on why pmcorp was a steal with its graham net net valuation, and why ancomlb is way overvalued based on any method of valuation?

Why don't you make some intelligent rebukes on my posts rather than talking nonsense non stop?

Yeah many argument about whose stock is better. The other one is AncomLB. Non-stop arguing. % weeks ago it was 17.5 sen. Now it is 18 sen. Gone up also by half a sen or 0.6%.

Whereas PM Corp now at 25 sen has gone up by 70% in the same period.

A tale of two corps

Someone questioned me why I did not follow the hype on MP Corp when it was about 54 sen and instead interested in this fallen angel PM Corp.

Just 5 weeks ago MP Corp was trading at about 50 sen and PM Corp 15 sen. Now PM corp price has risen by about 70% to 25 sen and MP corp fallen by 2 sen or 4% to 48 sen.

Sometimes really have to depend on luck. Or is it?

faberlicious, thanks for this MBMR Wa tip just yesterday. Earn some money for tonight's dinner for the family.

Now I find company warrant better to play than call warrant.

很好玩的遊戲

You have not included the dividend payment of 9 sen though.

Lets see if we got influence in the market or not by writing in i3.

I wrote little about this stock. this stock's volumes of information here is the credit of calvin. I did write one analytical post, that is the net-net valuation of PMCorp which I said the good quality net-net value of PMCorp exceeds its market price. Very very little downside. That was why I too invested in PM Corp. Because looking at its business performance, it has good gross margin > 30%. It does not burn cash. So what you got to lose by investing in PM Corp?

Other things one need to do when deciding if want to invest is scuttle-butting popularized by Phillip Fisher scores of years ago; ie find out from the management, its staff, its creditors, debtors, customers, competitors, shareholders etc about its products. Who has the time and energy to do all these?

Yes, we have calvin here. Who is more qualified than him to talk about PMCorp's business? He is one of the major shareholders who has the skin in it. He distribute chocolate for them. He talked to all the management staff, directors, present and the past, etc. He visits and replenish the Tudor chocolate in the stores of supermarkets. What else?

Many forumers also went to taste the chocolate products from PM Corp in the supermarket and the response is hugely positive. Is there a potential in PMCorp's business? I would think so.

Reading through what calvin wrote, do you trust him with his sincere posts? I do. So what are you waiting for?

Posted by bsngpg > Oct 22, 2013 04:41 PM | Report Abuse
BUY GENTING :
Hi KC Chong : yesterday you said you are interested on one of the counter which I coincidentally have in my portfolio. In conjunction to this, I would recommend you to look at Genting. If you are not interested on it, I would like to hear your reason too.
Hi All the good friends or Lau Jiau(Old Birds) : Please kindly drop your comments on Genting too.
I can talk more in weekend.

I truly believe Genting, a cash cow with great moat, is a great company to invest in. There are plenty of investment banks following this company and plenty of writeup about it. There is no where I can get near to what they have in term of information, knowledge of the industry, and their ability to analyze and value this conglomerate. I believe they have a specialist analyst in this gaming industry alone.

Posted by davidkkw79 > Oct 23, 2013 07:30 PM | Report Abuse
To Kchongnz, so far seem you are right, then I wonder how come got people just claim that you are cheating ? What they will get benefit of it ??
Btw, today up doesn't mean tomorrow still can be up, still have to see it in future....

What am I right on, david? If you talk about the share price of Plenitude, then you are wrong. In the first place, I seldom talk about share price and I am very poor in predicting future share price.

"How come got people claim that you are cheating?". Cheating is a serious crime to me. I won't go near people who cheat. Read my post on Plenitude here a couple of days ago. See for yourself and judge yourself? Do I cheat? Do I bullshit? Do I copy and paste from anywhere?

Yes, these are some of the accusations made by this guy iafx about me, non stopped. Look, I have 3044 posts now in i3, many of them are numbers, facts, analysis, valuations etc. Read through them and I believe many are beneficial for you too. Then you decide if I cheat, bullshit, copy and paste as accused.

He accused me of changing certain word in his post and attacked him. Read through the link suggested by himself and see who cheats. I don’t need to cheat to win an argument with him on finance and investment. But this will be a waste of your time.

"How come got people claim that you are cheating?" I don't know but may be some comments here may shed some light. I have deleted the names of the ones who posted.

Posted by Sep 18, 2013 12:45 PM | Report Abuse
Dear Kcchongnz,
I am a proud person, I do not admire people unless you are very good. You are one of them. I learn a lot of FA from you, invitation for dinner is my honour and it is a small money compared to the profit I made.
I like to meet you if you are back to KL. Thank you.

Posted by Sep 18, 2013 02:15 PM | Report Abuse
People with knowledge and skills like kcchongnz, ooi teik bee, matrixcool (just to name a few) when presenting their views on stocks, they always have supporting facts and figures. Thus the readers can do their own study, analysis and understanding before making a decision and are solely responsible for their own actions irrespective of whether profits or losses are incurred. We can see in the forum they are plenty of people just shouting buy buy buy, sell sell sell and some even predicting target prices without any basis of all. Some can even tell you that the counter will go limit up soon and yet there are some who believe such stories.

Posted by Oct 21, 2013 08:40 PM | Report Abuse
kc, i must say that i am a beginner in investing with less than 10 yrs experience... partly due to my young age. before i joined i3 and read your posts I have no investment philosophy or backbone... always buying stocks based on rumors or based on so called analyst recommendations... This has cost me. in just less than 1 year I hv learnt to analyze stocks myself and start making good decisions myself after following your posts and reading more investment books. In fact This year alone my returns from stock market already exceed all my investment returns of all previous years combined ! So pls keep up your good posts and sharing here.

Posted by Oct 22, 2013 12:28 AM | Report Abuse
But seriously, I really don't understand why these ppl just like to ridicule him ( KC Chong )for no reason ! 妒忌？
One saying for my friend KC Chong...不招人妒是庸才。你有料，让别人没机会表现， 就泼粪囖。
跳梁小丑， 由他们去！

Posted by Oct 21, 2013 09:52 PM | Report Abuse
“丢粪文化” - ”损人不利己心态”-"Pariah"

Posted by bigFAT > Oct 23, 2013 09:14 PM | Report Abuse
the gang of otb, inwest88,kc loh, kcchong plus new recruit name calvin have been successful duping people using their influence...lol this company makes small gains just 9 thousands ringgit....instead....never mind..the jwc gang has won..congrat for the manipulation...i wish i was duped also..so i can make some money...not my day

Wow, I didn't know that I have the power to "duping people using their influence", and the power of manipulation. What a compliment!

Or is the motive of your above statement due to your frustration as stated in your statement below?

"i wish i was duped also..so i can make some money...not my day"

I didn't know people do investing by hoping to be duped to something right to make money. What a great investment strategy you have.

Tan KW has posted another good article, one written by a good independent analyst 陈金阙

Posted by ckleow79 > Oct 23, 2013 08:09 PM | Report Abuse
we always can find a egg which can turn to golden egg in the capital market even the PE of current market are high.

Questions:

1) Is the present market with PE 15-16 really high? Or may be a more appropriate description is "not cheap"? I mean this is equivalent to an earnings yield of 6-7%, which is twice you can get from the fixed income investment, albeit with some risks.

2) If ckleow79 can find a good egg, why can't Tan Teng Boo, the oracle of Bursa whose job is to do value investing and earns fat fees? I am sure there are many investors like ckleow79 who have found some many good eggs and many of these eggs have turned to golden eggs already.


3) TTB has been holding 1/3 to 1/2 of the total assets in cash for the last 5 years. Its portfolio is largely unchanged for the last 5 years. Couldn't find anything worth buying for the last 5 years? Tell me how many true value investors have made how much return for the last 5 years?

4) If one looks at the performance of NAV of icap since listing, the great performance icap in NAV happened before and up to early 2008. Since then it has been under-performing the market and the average performance of unit trusts until now. Of course we should also considered that early days great performance of TTB. But could it be some kind of temporary hot streak?

I cannot forget how capital dynamic carried out its campaign and went to the extent of putting down a major shareholder Lexey Partners last year who was trying to do something good for all the shareholders, instead of trying to look for some good eggs for icap.

One year has passed. Have the promises of capital Dynamic to icap shareholders fulfilled? This article by 陈金阙 clearly explained all.

A great article! Why is ROIC and CROIC more important than ROE.

faberlicious, yeah you are right. The 41.35 sen is the EPS, not dividend. Saw wrongly. Die lah, sure kena hantam by somebody already. How?

Yeah with dividend of just 9 sen, or a dividend yield of just 2.4%, it is not that damaging to the warrant holders. At the closing price of the underlying share at 3.72 today, using option pricing, the implied volatility is less than 15%. Meaning the warrant price of 71.5 sen today is reasonably low. Besides the gearing 5.2 is great.

See the difference in dividend yield on the warrant price? Next time, let me know the dividend per share of any warrant you intend to ask.

Posted by iafx > Oct 22, 2013 09:23 AM | Report Abuse
"如果股市极端疯狂，给出高的离谱的价格，你还坚守长期投资不出售， 冷眼认为你就不是做股票投资的料子."

Can you tell us what do you mean by 离谱的价格? PE, Ev/Ebit, P/B, P/cash flow, P/sales????? What valuation method do you use? Discount cash flow? Earnings Power Valuation? ASSET-BASED MODEL? WHICH ONE? OR Is it based on your analysis below?

[ptaras a pick only bcos it is small & relately safe given its cash (also means $ not utilize); maybe could exercise bonus (hopefully not yet another private placement). given its outlook, it is actually too expensive already. given that price, there r a number of other counters worth better than this one. those who grabbed it during the 1.4-1.5 days a bless of god (no need say anything :). those who buy above 2.7 should continue to assess the viability of holding this counter. GCruey could have done a right thing by disposing it now & wait for next opportunity.]

WHICH ARE THE OTHER COUNTERS WORTH BETTER? AMPRO? MKLAND? WHY BETTER? IN WHICH WAY?

So davidkkw79, did you sell your Plenitude at 2.32 because of the fear monger below, or did you read my post on Graham net net yesterday, understand what a value stock Plenitude is and prefer to keep Plenitude as it closed at 2.40 today?

Posted by davidkkw79 > Oct 23, 2013 09:56 AM | Report Abuse
iafx, what you abuse on Kchongnz is true ? then I think I better cabut first, bfore this stock going to holland....

Posted by iafx > Oct 22, 2013 10:01 AM | Report Abuse
c how kcchongnz copied and cheat at kfima thread, pg.45:
Posted by kcchongnz > Jul 23, 2013 04:15 PM | Report Abuse
...
Btw, you got idea whether there is ghost in the this thread? You know the ghost who amended the word "revenue" with "profit"...

How I wish the admin of i3 can clear this thing up; who modified his comments? I am sure the admin can check back and see. If not there is no end with this parasite. i3 gets infested with parasite and makes the discussions deplorable. The site becomes a nuisance. No wonder so many good forumers just give up. Why spend so much time trying to contribute to the forums and at the end people think you are such a person as accused? No point.

How I wish the admin of i3 can clear this thing up; who modified his comments? I am sure the admin can check back and see. If not there is no end with this parasite. i3 gets infested with parasite and makes the discussions deplorable. The site becomes a nuisance. No wonder so many good forumers just give up. Why spend so much time trying to contribute to the forums? No point.

Yeah I encourage everyone to go to Kfima thread to learn a lot more about finance and investing, financial statement analysis and interpretations, plus valuation of stock. Kfima is used as an example.

There is no end in learning in life, isn't it?