JTFX,
So when are you going to give me a treat?

But seriously when I look at the business and financials of a company, like Fibon, the financials look really good. However, I never expect the share price go up like that. Fundamental analysis won't make you make big money in a short time. It is a long time investment process.

JTFX, Sephiroth etc, you make money Fibon due to your own skill in trading.

LBS Warrant, Wa (180913)

LBS Warrant A is trading at 75 sen while the underlying share is at RM1.71now on 18 September 2013. It has an exercise price of RM 1.00 and the expiry date is on 11th June 2018, or in about 5 years time. The warrant is hence in-the-money with an intrinsic value of 71cents (1.71-1.00). However if you buy Wa at the price now of 75 sen now, you pay a premium of 4.0 sen, or a premium of just 2.3% [(0.75+1.00)/1.71-1]. This premium is low and moreover, there is a gearing of 2.3 times for Wa. Hence Wa appears to be a good alternative in investing in the business of LBS.

The theoretical value of warrant depends on the price of the underlying share, the exercise price, time to expiry, its volatility, the risk-free rate; in that order of importance. The Black-Scholes option pricing model, using a historical volatility of 25%, risk free rate of 3.5%, dividend yield of 1.2% and LBS’s price now at 1.71 shows that the warrant has a theoretical value of 80.5 sen, or 7.5% above its present price of 75 sen.

The following Table 1 shows the settlement price of Wa with respect to the share price of the underlying asset. If LBS goes up to RM 2.50 (a gain of 46%), the settlement price of the warrant is RM 1.51 for a gain of 100%, more than twice that of if you invest in the underlying share. If the share price of LBS stay put at 1.71 at the expiry of Wa, one loses 7%. If the share price of LBS slips below 1.00, the exercise price, buyers lose everything.

The question you have to ask yourself is, What do you think is the direction of the share price of LBS before the expiry of Wa in 5 years time?’

Table 1:
LBS 1.00 1.71 1.80 2.00 2.50 3.00
Wa 0.00 0.62 0.80 1.05 1.51 1.97
gain/loss -100% -5% 7% 33% 100% 167%

My personal opinion is Wa offers a better investing opportunity because of its low premium with some gearing . It also has quite a long time before expiry.

Hap Seng company warrant is also called a stock warrant because it is a warrant with the value derived from underlying stock Hap Seng, hence stock warrant.

It is also a call (stock) warrant, the right but not the obligation to convert to the underlying share, as opposed to stock put warrant, one with the right to sell you the underlying stock before expiry.

Hap Seng Warrant, Wa (180913)

HAPSENG Warrant A closes at three 5s while the underlying share closed at RM2.19 on 17 September 2013. It has an exercise price of RM 1.65 and the expiry date is on 8th September 2016, or in three years time. The warrant is hence in-the-money with an intrinsic value of 54cents (2.19-1.65). However if you buy Wa at the price now of 55.5 sen, you pay a premium of 1.5 sen, or just 0.7% [(0.555+1.65)/2.19-1]. This premium is definitely very low and moreover, there is a gearing of 4 times for Wa. Hence Wa appears to be a good alternative in investing in the business of Hap Seng.

The theoretical value of warrant depends on the price of the underlying share, the exercise price, time to expiry, its volatility, the risk-free rate; in that order of importance. The Black-Scholes option pricing model, using a historical volatility of 25%, risk free rate of 3.5%, and Hap Seng’s price now at 2.19 shows that the warrant has a theoretical value of 78 sen, or 41% above its present price of 55.5 sen.

The following Table 1 shows the expected price of Wa with respect to the share price of the underlying asset. If HAPSENG goes up to RM 3.00 (a gain of 37%), the theoretical price of the warrant is RM 1.35 for a gain of 143%, 4 times that of if you invest in the underlying share. If the share price of Hap Seng stay put at 2.20 at the expiry of Wa, one loses less than 1%. If the share price of Hap Seng slips below 1.65, the exercise price, buyers lose everything.

The question you have to ask yourself is, What do you think is the direction of the share price of Hap Seng before the expiry of Wa in 3 years time?’

Table 1:
Hap Seng 1.65 2.00 2.20 2.40 2.70 3.00 3.50 4.00
WA 0.00 0.35 0.55 0.75 1.05 1.35 1.85 2.35
Gain/loss -100.0% -36.9% -0.9% 35.1% 89.2% 143.2% 233.3% 323.4%


My personal opinion is Wa offers a better investing opportunity because of its low premium and a good gearing . It also has quite a long time before expiry. Most of all, the company has been continuously buying back its shares recently. This is very good for Wa.

Time to wait?

Time is the friend of the wonderful company, the enemy of the bad.

Hey Frank, since you are in America, I want to ask you this question what do you think of the Red Indians said about this?

•When you realize that you are riding a dead horse, the best strategy is to dismount: Sioux Indian proverb

The premium and time to expiry are important factors in the pricing of the warrant. However they are not the sole determinants of whether it is expensive or not. The other factor which is as important is the volatility of the underlying share; how violent or calm the movement of the share price.

Even with a premium of 46% for SKP Resources, and even if the expiry date is shorter, there is still a good chance for SKP Res to get into in-the-money, if the share price moves in a wide gap, or high volatility.

In fact in my opinion, if the premium of the SKP Res is 20%, or even 30%, it is a better alternative investment compared to the underlying share. Moreover there is a gearing of 4 times which is reasonably high and hence good as a leverage instrument.

Say for example, if there are good news on SKP Res such as great improvement in earnings, SKP Res can move much higher and hence a spike of volatility in the upward side, the 46% premium of the warrant is not high and investors could still make money.

The step up exercise prices of SKP Resources of which the management intended for the warrant holders to exercise earlier, pose a greater challenge for the profitability in investing in the warrant at the present price.

Of course the other factor which is also as important is the supply and demand. Even if the warrant appear to be expensive, the market action may still provide profit opportunity for the warrant holders. But that is more of a speculative endeavor.

Frank, that is what friends are for.

If you've been playing poker for half an hour and you still don't know who the patsy is, you're the patsy. Warren buffet

Frank, at least you knew that you were the patsy earlier and abandon that game.

I have the feeling that General has his collaborators in i3. What do you think?

Company warrants and structural warrants

Company warrants and structure warrants are two different types of options traded in Bursa.

An option provides the holder/buyer the right, but not the obligation, to purchase or sell a certain quantity of the underlying instrument at a stipulated price within a specific time period by paying a premium.

Company or stock call warrants are issued by the company to raise money. It gives the holders the right, but not an obligation, to subscribe for new ordinary shares at a specified price during a specified period of time. Warrants have a maturity date (up to 10 years) after which they expire are worthless unless the holder had exercised to subscribe for the new shares before the maturity date.

Structured warrants are proprietary instruments issued by financial institutions that give holders the right, but not the obligation, to buy or sell the underlying instrument in the future for a fixed price.

For structure warrants, there is no conversion to the underlying share. All settlements only at expiry date and done with cash.

Basic Pricing of Options
The price, or cost, of an option is an amount of money known as the premium. For example, at the price of the SKP Resources and its warrants (exercise price=45 sen) at 35.5 sen and 7 sen respectively at the close of 17 September, 2013, the premium of buying this company warrant is 46% [(0.07+0.45)/0.355-1]. The buyer pays this premium in exchange for the right granted, or the “option” to exercise the right or allow the option to expire worthless. If before the expiry date the price of the SKP Resources rises above 45 sen, the exercise price, the holder of the warrant can exercise his right to convert to the underlying share. He then can sell the converted share to the market. If the price of the underlying share does not rise above 45 sen before expiry, the holder will just let the option expire without doing anything as he will lose more money doing so.

The two components of an option premium are the intrinsic value and the time value. The intrinsic value is the difference between the underlying's price and the exercise price. Specifically, the intrinsic value for a call option is equal to the underlying price minus the strike price. Any premium that is in excess of the option's intrinsic value is referred to as time value.

In general, the more time to expiration, the greater the time value of the option. In general, investors are willing to pay a higher premium for more time, since time increases the likelihood that the position can become profitable. Time value decreases over time and decays to zero at expiration.

Factors influencing and the pricing of options
The six major factors influencing the price of options are underlying share price, the exercise price, the expected volatility, time to expiry, interest rate and dividends. The higher the underlying share price, lower the exercise price, higher expected volatility, higher the interest rate and lower dividend will yield higher option prices and vice versa. For more information about options and their pricing, please refer to the appended link.

http://www.investopedia.com/university/options-pricing/

From this site, we will explore the investment opportunities for options; both company warrants and structured warrants.

Please feel free to contribute.

This is how I interpret the bahaviour of Mr Gan. He still have the confidence of his company, SKPRes, and that is no doubt about it. So he buys the underlying shares from the market in a big way and hence the share price rose up to 40 sen. He is willing to pay up to that price, or even higher because I think he knows SKPRes is worth that price.

Market participants saw the rise in the underlying share and insider buying and they follow suit. But many were buying the warrant because they think the warrant is "cheap", even when it rose up to 10 sen in tandem with the rise of the underlying share to say 40 sen. Moreover the warrant provided a gearing of about 4 times then. It is a good punt for many people. However many do not understand how to value warrant.

So Mr Gan dumped all his warrants at good prices. His action still give him a firm grip of the firm with probably the same controlling power with his increased holding in the underlying share though he cleared his warrants.

He dumped the warrants because actually the warrant was expensive at 10 sen when the underlying share price was 40 sen. Don't forget that SKPRes pays high dividend yield. The shareholders of SKPRes enjoy the dividend but not the warrant holder. Hence the high dividend yield actually destroys the value of the warrants in a big way.

Using an option pricing model,when SKPRes was at 40 sen, and a historical volatility of 30%, the value of the warrant is only half of the market price of 10 sen. similarly with the market price of the underlying at 35.5 sen now, the value of the warrant is also only half of that. Incidentally the value of the warrant is made up of two parts; the intrinsic value and the time value. The intrinsic value of the warrant is zero and all its value is in the time value.

So if you are Mr Gan, which will you prefer to hold and which to sell?

Let us forget about the complicated option pricing and look at the premium of the warrant now. With an exercise price of the warrant at 45 sen, the premium at the present price of the underlying share and warrant at 35.5 sen and 7 sen respectively is 46% [(.07+.45)/.355-1].

That means the holder of the warrant can only breakeven if the underlying share price rises by 46% to 52 sen before expiry of the warrant in less than 4 more years. That also means the underlying share price must rise by a compounded annual rate of about 10% for the next 4 years for that to happen. It really doesn't sound difficult at all, does it because that is roughly the long-term return of the market? Moreover one doesn't have to wait until expiry of the warrant to sell it. It is the American style of option.

Not until you take into consideration of the high dividend payout each year which will erode the value of the company, and the staggering exercise price; ie the exercise price will increase to 55 sen in the fourth year, and then 65 sen in the fifth year. This staggering of the exercise will further diminish the value of the warrant.

Of course one may make money without having to know the value of the warrant because then it is a supply and demand situation. This is also because most market participants have no idea of how the value of the warrant is made up of. But punting with the insiders will be at a great disadvantage. don't you think so?

Posted by JCool > Sep 17, 2013 12:04 PM | Report Abuse

Kcchongnz.... NO ANSWER IS BAD ENOUGH.. WAT IS WORST IS TAT U HV ACTUALLY FLAGGED ME FOR ABUSE FOR A TOTAL OF 17 TIMES...17 TIMES!!!

Hey the cool guy, I have just respond to your superb analysis that I flagged you above.

CAN'T ANSWER IS ALREADY NO GOOD INSTEAD TRIED SO HARD TO SILENCE ME!!?? OMG!! REALLY DID NOT EXPECT U TO SCOOP SO LOW.... OMG!!

Can't answer or you don't understand what I am talking about? Read my posting today at 10.46am above. Long respond to you. Please rebuke.

KCCHONGNZ... NOW WE REALLY KNOW WAT KIND OF PERSON U R!!!

so what kind of person am I?

N REALLY WAT KIND OF SECRET DEN R U RUNNING?? TAT U HV TO TRY SO HARD TO SILENCE SOMEONE WHO JZ SO MUCH AS QUESTIONING UR VALUATION ??!! OMG!! OMG!!

Try so hard to silent your questioning on my valuation? What for? Are you in my league as stated by inwest88? Very cute statement.

I3 administrator well done.... good work.. N kindly do something abt
tis guy who abused d Report Abuse... TVQM..

i3 administrator, yeah do something to me, fast fast. But for what???

kcchongnz..... i dont nid ur answer la.... i can point out ur mistakes.... i of cos knew d answer.... u mr empty vain...

You point out my mistake? So rebuke my response at 10.46am today please! You know the answer? Really ah? What answer? Show some valuations of MFCB here please!

Hey the cool guy, by reading the comments on mine below, you can come to the conclusion that I flagged you?

Posted by kcchongnz > Sep 14, 2013 06:18 PM | Report Abuse X
Hafiz, please don't flag anybody here. I think we are getting into better discussion now.

Posted by kcchongnz > Sep 14, 2013 08:00 PM | Report Abuse X
Hafiz, I don't think it is appropriate to raise the flag. He must be given the right to speak

Posted by kcchongnz > Sep 16, 2013 04:51 AM | Report Abuse X
Posted by Fat Cat Tim Buddy > Sep 15, 2013 09:42 PM | Report Abuse
Hey please don't flag this comment.What is wrong with this comment? The same thing I see many other comments flagged, for what?


Hahaha, the cool guy, what kind of analytical skill do you have? No wonder inwest88 posted this?

Posted by inwest88 > Sep 14, 2013 03:12 PM | Report Abuse
kcchong, I reckon you should not waste your valuable time disputing with someone who is far below your league.

Anybody who has read my posts about my rationales of picking the companies for long term investment would have notice that theoretical valuation of a stock is not the first thing I would do. I look at its business, its margins and efficiencies, growth, cash flows, financial health etc first. Then I see what is its market valuation such as Price-to-sale, Price-to-book, PE, earnings yield of enterprise etc. Then if I find the company interesting, only I look at valuation to see if it is worthwhile to buy or not. This process I call it looking for a good company to invest at a bargain price.

In MFCB’s case, its enterprise value at the present share price of 1.83 is just 269m and its latest earnings before interest and tax (ebit) is 120m. This means that you can buy over the firm with 269m and earn an ebit of 120m each year.

Let us just assume that MFCB earns this ebit (assume no growth) for another 5 years for its entire business just before one of its power plant operating agreements expires. The total ebit amounts to 1.3m. The present value of this ebit discounted at a rate of 10% is 455m. So is it expensive to buy the company with a present value of its ebit at 455m with 269m? Please note that after 5 years, although one of its operating agreement of a power plant ceases (or both?), it still has its other assets in place such as its limestone business, property development, cash and cash equivalent etc which are very substantial. Of course things may not be that simplistic.

Why don’t I straightaway do theoretical valuations? Valuation is an art but not a science. There are huge limitations in valuation in investment. But does it mean that it is useless? Some savvy investors do just the above before investing and not bother too much about valuation. Of course we can’t say they are wrong. They have their valid reasons. But for me, just like buying a house, we have to have a feel of what its value is before I fork out my money, even though how much I like about the house. To buy a stock, I treat it as investing in part of the company’s business and I must have a feel of its value as a guide. Even in valuation, I use various methods to countercheck.
Then only I will look at its market price now, is there an adequate margin of safety in investing in this share? This is because I very well know that my assumptions in my theoretical valuations could be wrong. Protecting the downward risk (In my case is not cut loss) is more important than high upside potential.

There are numerous methods of valuation, discount cash flow is only one of them. It is more sophisticated method but it doesn’t mean it is better. This is because the more important part is the assumptions. In this case the assumption of its future cash flow is the most tricky. If you read all the research reports about the forecast of professional analysts, you would know that most of them miss the forecast by a huge margin. For example in the US from 2001 to 2006, the average 24-month forecast error is a whopping 93%, 12-month 47%. The absolute scale of the average forecast error is 25% (US Global Research).

In MFCB’s case I am using the Earnings Power Valuation method for the analysis of its theoretical enterprise value. This is done with the normalized ebit done with the average ebit margin of the last few years and assuming there is no growth of its ebit forever, which is a conservative approach. Then the debts and minority interest is deducted and excess cash added back to obtain the theoretical present value of equity attributed to the common shareholders. In this case the EPV/share is RM2.71, 48% higher than its share price of RM1.83.
However, I am not asking anyone to buy the share at RM2.71, am I? I said the margin of safety for investing in this share is 33%.

How else do you expect me to do it? By separating the cash flow of each individual power plant, each business units, and forecast their respective cash flows year by year and after 5 years to 10 years, 20 years and then calculate the present value of each and sum them up? And also forecast its potential other power plants which they may get, the cash flow from its new plantation venture in Cambodia, the growth in revenue and cash flow from other divisions like quarry, limestone products, property development etc. How much work got to be done and how many assumptions have to be made and so many analysis to be done? Do you have a clue of that? Are you out of your mind? Who am I? What kind of resources do I have?

If you think this must be the way to do it, then show me how you do it? Talk is easy. If you are not able to, then get some professional analysts to do it and show me. Tell me how do most professional analysts do their analysis? Do they do like what you want me to do? Just go and read those analysis there are doing now.

Posted by JCool > Sep 16, 2013 08:57 PM | Report Abuse

KCCHONGNZ... MY 4TH ATTEMPTS TO PUT FORWARD MY CASE.. N JX YET ANOTHER QUICK N EMPTY REBUKE FROM U.... ANY MORE RESPONSIBLE N RESPECTABLE PERSON WOULD HV SAID.. O.. JKHOO LOOKS LIKE U HV A POINT THERE... LET ME TAKE A LOOK AT MY VALUATION AGAIN...... BUT U R SHIT LA..

Do I really have to follow your "advice" to forecast the future cash flows of MFCB 10-20 years down the road and entertain you and give you a "scientific" and mathematical "exact" valuation? Read these below:

Posted by JCool > Sep 8, 2013 01:37 PM | Report Abuse
Who wrote this? Long analysis..... must have spent days weeks or months on it but jz siok sendiri n waste of time Totally useless n no influence on d share price at all

Posted by JCool > Sep 11, 2013 04:25 PM | Report Abuse
HaHa I m here for d $$$$$ u r going for d i love u bro.. really trully love u.. muack muack.... let's go for laksa.... Luv Luv.. : )

That is precisely d problem... That is why MFCB never moved.
Posted by JCool > Sep 14, 2013 05:59 PM | Report Abuse
HaHa..... copy and paste lah, tipu-pusing lah, bullshit lah, liar lah.... looks like it is not jz all love love o... uncle.... ; )

Posted by JCool > Sep 15, 2013 09:32 PM | Report Abuse
very well wish u all good luck.... u bunch wit a combined age of more thn 600 years but somehow never got wiser freaking seniles morons retards idiots ...


BUT SINCE $$$ INVOLVED N YOUNGSTERS... YOUNGSTERS WHO THUS FAR HV RESPECT FOR U R WAITING... I URGE U TO GIVE A GOOD TECHNICAL ANSWER BEFITTING UR VAIN...

Oh now you are acknowledging that the writeup is not just "siok sendiri n waste of time Totally useless"?

Wow, "YOUNGSTERS WHO THUS FAR HV RESPECT FOR U R WAITING". No more saying "nobody gives a damn" to my writeup?

"Youngsters"? I don't know if they are "youngsters" as claimed by you. But I do know many of them are very experience investors; inwest88 ( an experience and prudent investor), Ooi Teik Bee (we are of different school of thoughts), Fat Cat, ipomember (I have argued with him constructively before), houseofordos (many ideas of my new stock list came from him), nokenzo, hakeiyila,Frank Soweto (well seasoned and have invaluable experience money and university education can't buy), bsngpg (well experienced and seasoned too and we also differ in some investment choices), sh2383jbt, choolooi, Jaack1 (he is the one who alert me of this good stock), Hafiz, Saturn, Sephiroth, Jimmy, tonylim (Lou chiow), wajatimur, stockwatch, and alenac. How do you know they are youngsters ah?

I must give you a good technical answer? To you? Do I owe you? Do I owe anyone? Why you still do not agree with me that I don't owe any "technical answer" after all my rational arguments?

Yes. A substantial amount of the asset belong to MI as the financials of the subsidiaries are consolidated into MFCB statements.

Disclaimer continue
My analysis could be totally wrong. If you put your entire retirement fund and buy those stocks in the list, and if go bankrupt, please don,t come crying to me and want to borrow money. I won't give a damn. I still could sleep like a baby.

Oh yeah another thing, if you can't stand reading my disclaimer, you could sit anywhere you like.

Disclaimer: I am not an analyst, neither have I gone through any formal training as an analyst. I am not an accountant, and neither have I gone through any training in accounting. Nevertheless I will pretend myself to be an investment analyst and an accountant. I will act like one now.

The information and analysis contained herein, is for information and fun purpose. It is not guaranteed by me. This is because the future is unknown. I have good intentions but my financial statement analysis and valuations could likely be wrong.

If you choose to buy the stock, you could lose your entire investment and please plant into your head that it is your own responsibilities. And make sure that you shed no tears. But if you make money, please ensure that you deposit 20% of your gain in the account number 12-345-678-90.

Lastly, this disclaimer is for fun only.

Hey house, why didn't you put a "disclaimer" in your valuation?

house, good one.

You are already conservative doing that. If quoted share, use 100% market value. Port facilities should worth something.

And have you deducted minority interest? Anyway, my estimate is higher because of the above. But conservative is good especially when contemplating whether want to invest or not.

Posted by mhchai > Sep 13, 2013 07:35 PM | Report Abuse
kcchongnz, can you help me to calculate the fair value of PRKCORP ? TQ

The earnings of Prkcorp is volatile and hence hard to estimate its intrinsic value. Sometimes it sell land and boast up its earnings which may not be sustainable. I would recommend you to the following blog for hsi writeup on Prkcorp. He knows much more than me about Prkcorp.

http://blisswise.blogspot.co.nz/search?q=prkcorp

However, if you are interested, here is a rough estimate of the intrinsic value of Prkcorp based on absolute PE.

Katsenelson’s absolute PE for Prkcorp

Basic PE for Prkcorp with a growth of 2% and a dividend yield for last year of 2.6%,

Basic PE = 8 + 0.65*2 + 2.6 = 11.9

Business risk: Prkcorp’s business has low efficiencies with slightly below average return of assets of 7.8% and return of equity of 10.1%. Cash flow is good. A discount of 5% is applied to its business risk.

Financial risk: Prkcorp has a very healthy balance sheet with a reasonable debt-to-equity ratio of 0.2. Hence no premium nor discount is applied.

Earnings visibility: Prkcorphas earnings is not stable. a discount of 20% is applied.

Hence the absolute PE for Prkcorp is:
Abs PE = 11.9* [1+(1-105%)] *[1+(1-100%)] * [1+(1-120%)] = 9.0

Fair value of Prkcorp= 9.0*0.381 = RM3.45

Do I worry about people following my postings and buy stocks and become bankrupt?

A regular unit trust agent (or is he a financial adviser, not sure) posts the performance of unit trusts in Malaysia. I just stumbled into his latest posting today:

http://klse.i3investor.com/blogs/invest_made_easy/36962.jsp

So I have summarized the top three unit trust funds invested in Malaysian equity as below together with my portfolio return for the 1, 3 and 5 years as at 15/9/2013 as shown.

Year CAR 1 3 5
Kenanga Growth Fund 18.8 20.1 20.5
Philip Master Equity Fund 28.8 16.82 20.5
MAAKL 16.4 17.2 20.3
My portfolio 42.9 21.5 27.3

My portfolio return beats all of them in every category. Mind you these are the top three Malaysian equity funds. Yes all of them and also with a huge margin.

But seriously unit trusts funds have some restrictions which are at their disadvantage; they have too much money to invest and they cannot invest in some shares with low liquidity. Of course the other thing is the fees and transaction costs etc.

I am not trying to brag or what, but just to stfu those fellows who said my postings and stock picks (even though I didn't ask anyone to buy) can make people bankrupt. That I bullshit, tipu pusing or whatnot.

No, I am still not asking you to buy those stocks I have written. they are for fun only.

Posted by Frank Soweto > Sep 16, 2013 10:46 AM | Report Abuse

no worries invest88 for you to recognize which stock is speculative your success rate is already 50% better than others who don't. You know Initially I made about 15K on KNM and it was like easy money and every time it dropped I kept on averaging down - soon all my gains was wiped out and the losses kept piling and General kept opening his mouth with the projects la contracts la guidance la and out of the 10 analysts that covered KNM 9/10 have high Buy TP and so I kept buying :(
I came to my senses when I finally 'accept' the reality that this General is a CONMAN ( I dun like to use the word )after reading some articles and from his actions in running the company that matches what they all wrote and this General really was one of the worst among all the worst. Zemoola has written very well about this fella. and you're right that behind a successful punter here there are 10 who failed miserably and lost more than I did but like my fren always tell me we learn best what we learn hard but we HAVE to learn in order to be successful in this market.

As I have said before, Frank's personal experience in investing in KNM is invaluable, no money can buy, and nobody can learn it from doing a MBA. But it seems like you are wasting your breath here, Frank.

9/10 analysts have high buy TP for KNM last time and so many people lost their pants in KNM? So is analyst with that CFA chop really good in doing their work? Tell you another thing, I am very sure most of them are paid for doing those jobs of collaborating with unscrupulous sharks to cheat small retail investors.

Posted by JCool > Sep 16, 2013 12:42 PM | Report Abuse

Jaack1... after 2017 d 98442000 will not b there anymore but kcchongnz valuation is inclusive of tis 9844200 till perpetuity... till forever... u tell me if he valuation is right?


Where the hell you find this 9844200 appear in my valuation? Till perpetuity? Till forever? Do you really understood what I do or not?

If the valuation is right? Valuation is an art. There is no right or wrong. It all depend on what is your assumptions.


Okokok, my valuation is wrong lah. Show us yours then? If you can't, get your professional analysts friends to do and show us here. As I have said before, I guarantee you I will give you a lot of constructive criticism, unlike you just simply say this and that without showing what you got.

Posted by JCool > Sep 16, 2013 12:37 PM | Report Abuse

INVEST88.. HAHA.... BETTER WEAR YOUR SPEC N LOOK AT MALTON THREAD AGAIN...

http://klse.i3investor.com/servlets/stk/6181.jsp

THAT THREAD IS FOR TAT ULTIMATE MORON N IDIOT Sephiroth WHO BLAMED MY POSTS THERE FOR CAUSING MALTON PRICE TO DROP WHEN IN FACT IT WAS ALL BCOS OF HIS ULTIMATE STUPIDITY.... N HE HAS TO LIE TAT HE HAS SOLD AT HIGH.. FREAKING ULTIMATE MORON N LIAR..

KCCHONGNZ AREN'T U WORRY? U FOLLOWER IS LIKE TIS O.... NOT DANGEROUS KA??


Do I worry? Why should I worry? If Inwest88 lose money anything to do with me? That is his problem, isn't it ,Inwest88? Sephiroth?

Dangerous or not? Oh this one definitely I don't think so. You go and read Inwest88 posts about his philosophies of investing. He is one of the most conservative guy. Sephiroth even appear to be making a lot of money in the stock market recently.

But seriously, is it worrisome or dangerous if anyone here insist following my writeup and go and buy those shares in my list (without my approval, hehe), is it really dangerous and worrisome? Go read what I have posted at 2.18pm yesterday here. It is just on this page here.

1) None of those stocks in my list of 10 in the negative territory, all positive.
2) The average compounded annual return of the portfolio out-perform the broad market by a huge margin for the 1, 2, 3, 4, 5-year return.
3) the portfolio out-perform all the unit trusts, hundreds of them investing in KLSE for the last 5 years as shown in the fundSupermart website.

Hey I never heard of anyone complain that he loses money because of me. If there is, I also ask him to go and fly kite as whenever I have asked him to buy. And alos those people who made money also is their own effort, none of my business also.

Posted by JCool > Sep 15, 2013 09:32 PM | Report Abuse
kcchongnz... from d postings tat i c here nobody really gives a damn abt wat u put in ur valuation so long as u stir up d interest in d counter n its price moved up... n everybody made a profit... n cheers all round..... so far so good cos as d liquidity bull is stil around.... but d test is wait till they made losses later u c if d love is stil there...

LIQUIDITY FOR MFCB? I DON'T SEE ANY WOH. NOBODY GIVES A DAMN OF WHAT i PUT IN MY VALUATION? IS IT MY FAULT? DO I CARE?

BUT IF YOU GO TO THESE THREADS BELOW, MANY SEEM TO BE ASKING ME QUESTIONS WOH, ABOUT FINANCIAL STATEMENT ANALYSIS, VALUATIONS ETC. dON'T BELIEVE, GO THERE AND SEE FOR YOURSELF:

http://klse.i3investor.com/servlets/forum/900172429.jsp?ftp=2
http://klse.i3investor.com/servlets/forum/900255072.jsp
http://klse.i3investor.com/servlets/forum/900214344.jsp

very well wish u all good luck.... u bunch wit a combined age of more thn 600 years but somehow never got wiser freaking seniles morons retards idiots ...

I NO NEED TO RESPOND HERE. SEPHIROTH HAS BEEN THAT.

Posted by sephiroth > Sep 15, 2013 09:48 PM | Report Abuse
Jcool really like to describe himself in depth and surprisingly extremely precisely accurate as below
Posted by JCool > Sep 15, 2013 09:32 PM
...freaking seniles morons retards idiots ...
gotta give u the thumbs up

Sephiroth, that is why I ask others not to flag his comments. He has a right to say what he wants. We also have a right to see if this guy really that good as shown by what he said and his sarcastic and cynical comments. Notice he even said he knows how to do valuation?

Most of all, we have the right to see his real character.

Posted by Fat Cat Tim Buddy > Sep 15, 2013 09:42 PM | Report Abuse
Jcool , i think you are looking for affirmation , and i have to agree with you, putting a disclaimer is better than none, no one will getting harm with an extra '' disclaimer ''
right?

Hey please don't flag this comment.What is wrong with this comment? The same thing I see many other comments flagged, for what?

The cool guy has been keep on asking me to put a disclaimer as he doesn't seem to able to rebuke any of my responses, not a single one, despite his initial sarcastic and cynical jab on me. I am still waiting for his response even on this disclaimer thingy as below:

Posted by kcchongnz > Sep 14, 2013 07:45 PM | Report Abuse X
I3 administrator, why you still haven't answer my questions
1do I have to put a disclaimer when putting my valuation of a stock here?
2 do I have to be a CFA to write an analysis in i3?
3 do I have to be licensed with security commission to put up an analysis of a stock here?
4 do I have to be a FAR licensed with Bank Negara put put up a valuation here?
5 do I have to visit the management, the factory, the site, dig through the company's account, ledger, check books etc to make sure everything is correct befor I write anything here?
6 if I don't do all the above, will you inform the police to take me to jail?
7 etc etc etc

For fat cat's comment, I would answer here. Yes, there is no harm at all to put the disclaimer. But I also want to ask you this:

1) No harm, but do I have to?
2) Am I peddling for others to buy stocks? Note I only talk about intrinsic value. I don't talk about this share price should go up to $10, $20 etc, do I?
3) Does providing an education piece, showing how to read and interpret financial statements, doing valuation in a public forum needs disclaimer?
4) Do I force you to learn?
5) Am I one of those licensed financial planner, financial adviser representative, CFA etc?
6) Do I really have to waste time, writing more with those disclaimers?
7) What is the purpose of those disclaimers then?

I do have asset allocation for fixed income too. But each person is different according to the risk profile of each individual, age group, risk appetite, family circumstances, income etc etc. so cannot compare like that.

Tan KW, valuation is an art. Do you remember how many times I have said that?

LC Chong does not summarize what he does and what assumptions he uses. So sometimes it is a challenge to find out from his spreadsheet with the numbers all over. But basically we are doing the same thing, discount cash flow analysis.

In this case LC starts with owner’s earnings (OE) of 41.87m for 2013. I am not sure how he deduces that as mine would be a lot less. He uses different growth in OE and discount rate too to obtain the intrinsic value of the equity shareholder, I presume. He has carried out the analysis with many scenarios, base, good, bad and ugly with also different intrinsic values for different years. Not sure why he needs to do so many scenarios and why is the intrinsic values different at different years. But I am sure he has his valid reasons.
I start in this particular case with Ebit and assume all earnings and dividends reinvested and earning at different return of capitals at high growth and terminal growth respectively to obtain the value of the firm. Then subtract the debts and add non operating cash and investments. If you have my spreadsheet, it would be the sheet marked “DCFM2”.

Which makes more sense? They both have their own advantages and disadvantages.

Valuation is a very rough estimate. It is more of getting a feel of the value of the stock. Unless we are using the same method, the same data and same assumptions, the difference in our intrinsic value can be very large. That is why the concept of margin of safety comes into play.

The Eight Wonder of the World: The Power of Compounding

I have just posted the return of this portfolio as below:

Table 3 15/09/2013
Year 1 2 3 4 5
Average Portfolio CAR 42.9% 25.3% 21.5% 24.9% 27.3%
KLSE CAR 9.1% 13.9% 6.5% 9.7% 11.5%
Excess return 33.8% 11.5% 15.1% 15.2% 15.8%

What does it mean the compounded annual return (CAR) is 24.9% for a four year period?

Let assume that I have invest 1m 4 years ago and the CAR is 24.9%. Assuming I also reinvested all dividends into the fund. Now the amount of that portfolio will theoretically grow to 2,435,000. If I can earn this CAR for 20 years, the amount will grow to 85.5m!

But in actual fact I have only 1,767,000 in the portfolio after 4 years. Why the shortfall?

First though the stocks in the portfolio resembles my actual portfolio, they are not exactly so. The main thing is my fingers are itchy and I did quite a bit of trading, changing some stocks, sell and buy back, punt some warrants, drawing out considerable amount of cash etc. In fact I have withdrawn approximately the same amount of money left in the portfolio now. So the actual CAR of my portfolio because of this is only 15.3%, a shortfall of 9.6%. What a huge difference.

Compared with the NAV of icap of which the fund manager holds one third of its assets in cash with say 4% interest and the approximate CAR of 10% for the equity holding, icap's 4-year CAR worked out to be approximately 8.1%, another huge difference in return.

What is the lesson learned here? I can sum up some here:

1)Frequent trading may not be good for a long term investor.
2)Drawing of money instead of reinvesting the dividend is not a good idea if your investment is for long term. Let the magic of compounding interest works for you.
3) Companies paying high dividend, instead of reinvesting most its FCF in value enhancing projects may not be good for shareholders.
4) Too much worry about macro-economic uncertainties like what Tan Teng Boo has been doing for icap and hence trying to time the market may not be good for value investors. This is TTB's Achilles heel.
5) A difference in a few percentage points makes a huge difference in the final amount of money in compounding.

Posted by Jimmy Young > Sep 14, 2013 11:41 PM | Report Abuse

Hi KCChongnz,

Want to ask your opinions on the following about their intrinsic values, returns on investments etc etc - i don't know how to do analysis but if you can help to shed some thoughts on these stocks .. say in 5 years in the future .. whether it's OK or not OK to invest in these counters .. would appreciated it, Sir ..

1. SKPRES
2. NTPM
3. TH Heavy Engineering

Thanks

Jimmy, for the first two stocks i have already given my opinion above. For the third one THHE? Ramunia? Ah sori lah, no good impression on it. Don't wish to waste time on it.

Btw, why you asked about THHE ah?

Just to clear some misconceptions about my postings as somebody spreading rumours and fears as if I am a monster making people bankrupt buying those stocks I have done analysis and posted in i3.

When you talk about value investing in the stock market, we are talking about buying stocks of good companies with intrinsic values at a margin of safety, and then sell them when the price of the stocks have risen closed to the intrinsic values. Time is needed for that to happen, and we are talking of a time horizon of years, not days, weeks or months. That will be a trading activities, not investing. So to see the performance of a portfolio of stocks, we have to look at the compounded annual return (CAR) for years as compared to the broad market.

Tan Kian Wei, one of the major contributors in i3 has put up my long term portfolio some time ago as shown in the following link:
http://klse.i3investor.com/servlets/pfs/13147.jsp
Incidentally I did analysis and valuations on those stocks and shared in i3. I have no intention of asking anyone to buy so that he goes bankrupt. I have no intention to peddle the stocks as many here do realize that i3 has no such clout. I could have a selfish motive; i.e. to solicit constructive feedback from forumers here so that if I have made any mistake in my analysis, somebody tells me that and I can then avoid losing my own money investing in those stocks. So if anyone has bought any stock in the list based on my analysis, he can’t blame me for misleading him and making him bankrupt, can he?

But does anyone lose money if he were to buy those stocks in my list when it was first put up by TanKW on 21 January 2013? Here is an analysis of their share price performance as shown in appended Table 1 appended below.

All 10 stocks in the portfolio have positive returns which varies from 0.5% to 103.3%. The average return since 8 months ago is 38.4%. Half of them have return more than 30%. This is compared to just 8.2% of the KLSE index. So can anyone blame me for buying those stocks in my portfolio without even paying me a cent?

But like I have said, the real test of an investment performance is its long term return from an investment process. How does the portfolio perform in a long term basis? Table 2 appended shows the details of the compounded annual returns of the portfolio and stocks.

Table 3 below here shows the compounded annual returns (CAR) of the portfolio as compared to KLSE. As you can see, the portfolio outperform KLSE every year by a very wide margin. For example for 5-year CAR is 27.3%, 2.4 times that of KLSE of 11.5%, or an excess return of 15.8%.

So anybody following my list complaining of loses any money? Anybody went bankrupt as claimed by somebody here? Does anybody want to volunteer to check the hundreds of unit trust funds invested in the local equity if any of them is better than this performance? I bet you can’t.

Table 3 15/09/2013
Year 1 2 3 4 5
Average Portfolio CAR 42.9% 25.3% 21.5% 24.9% 27.3%
KLSE CAR 9.1% 13.9% 6.5% 9.7% 11.5%
Excess return 33.8% 11.5% 15.1% 15.2% 15.8%


Table 1 15/09/2013
Stock Name Ref Price Price now Div rec Change %change
Kfima 2.02 1.95 0.080 0.010 0.5%
Pintaras 3.12 5.70 0.100 2.680 85.9%
ECS 1.06 1.11 0.025 0.075 7.1%
Plenitude 1.85 2.21 0.050 0.410 22.2%
Jobstreest 2.40 4.80 0.080 2.480 103.3%
Pantech 0.78 0.960 0.012 0.192 24.6%
SKPRes 0.34 0.355 0.000 0.015 4.4%
NTPM 0.47 0.61 0.015 0.155 32.9%
Kimlun 1.5 1.92 0.048 0.468 31.2%
Prestariang 1.21 2.02 0.055 0.865 71.5%
21.635 0.465 2.1%
Average return 38.4%

KLCI 1637 1771 134.0 8.2%


Table 2 15/09/2013 Years
Stock Name Code Price now 1 2 3 4 5
Kfima 6491 1.95 -6.3% 8.1% 18.2% 22.9% 34.7%
Pintaras 9598 5.70 90.0% 54.1% 47.7% 41.8% 35.7%
ECS 5162 1.11 5.7% 7.8% 14.7%
Plenitude 5075 2.21 18.8% 8.4% 0.6% 11.7% 18.4%
Jobstreest *0058 4.80 84.6% 28.9%
Pantech 5125 0.96 52.4% 41.4% 11.5% 5.9% 10.6%
SKPRes 7155 0.355 0.0% 45.9% 35.3% 42.3% 37.1%
NTPM 5066 0.61 32.6% 6.8%
Kimlun 5171 1.92 81.1% 26.5% 22.7%
Prestariang 5204 2.02 69.7%

NTPM, Jimmy? Yes. But it is better to read what this blogger say about it. He is one of the best for Bursa stocks. He knows NTPM very well.

http://www.intellecpoint.com/search?q=ntpm

Posted by Jimmy Young > Sep 14, 2013 11:41 PM | Report Abuse
Hi KCChongnz,
Want to ask your opinions on the following about their intrinsic values, returns on investments etc etc - i don't know how to do analysis but if you can help to shed some thoughts on these stocks .. say in 5 years in the future .. whether it's OK or not OK to invest in these counters .. would appreciated it, Sir ..

1. SKPRES
2. NTPM
3. TH Heavy Engineering
Thanks

Jimmy, I don't have a crystal ball about SKP Res future. Neither do I have the luxury to go scuttle-butting about SKP Res business prospect in the future. The only thing I can do is to look through its recent past and see if the management has done a good job or not. In my experience, if they have, it is probable that they can do a good job in the future too. For example a good golfer who has been playing very well in the game and with a handicap of 5 now, isn't it likely that he would most probably hit a round of golf for a score of under 80 today? Well even if he can't score below 80, a score of 85 is still a good round for most golfers. The past doesn't repeat itself, but it rhymes.

I did read about some articles about Dyson (its big client in vacuum cleaner) is doing quite well in China and they are expanding. hence this will benefit SKP Res too. SKPR's last year's growth in earnings lowed down considerably, but it was still at a respectable rate of 10%.

Below was what I posted about 5 months ago. Though the growth has slowed down, it doesn't mean it won't pick up again. Of course it may slow down further, i really don't know. But then you still can look at SKPR as a value stock.


Posted by kcchongnz > Apr 7, 2013 12:13 PM | Report Abuse X

SKP Resources, A growth stock

SKPR’s revenue and earnings has been growing at a compounded annual growth rate of 20% and 18% respectively for the last 5 years as shown in the table below.

Year 2012 2011 2010 2009 2008 2007 CAGR
Revenue 414834 256996 195735 174729 178341 170066 20%
EBIT 48200 30981 17552 5307 22323 19811 19%
NI 36844 26245 13404 2931 18294 15997 18%
EPS 0.061 0.044 0.022 0.005 0.030 0.027 18%
Equity 179936 158059 140797 130386 129561 113792 10%

TA and OSK forecasted that its revenue and earnings will continue to grow at an average of 16.7% and 19.4% a year respectively for the next three years. SKPR is hence considered as a growth stock with growth rate more than 15% a year. However at a closing share price of 31.5 sen on 5th April 2013, SKPR is trading at a very low PE ratio of 5.1 (<<10), PEG of 0.3 (<<1), a P/B of 1.2 (<1.5), and a dividend yield of 9.8% (>>3.5%). Hence SKPR is not only a growth stock, it is also a value stock in every aspect.

A high growth stock has a major concern; that is if the growth adds value to the firm. Growth is considered shareholder value enhancing if the growth in earnings exceeds the weighted average cost of capital of the firm. With a return of total capital of 20.5% last year, it has clearly demonstrated that the growth is shareholder value enhancing.

So is SKPR a free lunch for investors; one with high growth and yet selling at a very cheap price?

Posted by TeckChuan Lee > Sep 11, 2013 11:59 AM | Report Abuse
Can you give me a quick review on Media Prima?

Teck Chuan, Media Prima is Warren Buffet kind of company; A cash cow!

With the political clout it has, huge amount of business at good profit margin (12.4%) and hence boast its ROIC at good rate of 17%. Huge amount of CFFO, 348m, or 165% of net income. FCF 250m, or 15% and 27% respectively of revenue and invested capital. Certainly I would classify this as a great company (in term of a business concern).

At a PE of 14, P/B of 1.9, and an earnings yield of 10%, I don't think it is expensive.

The only thing is whether you have any political belief. For me, I can't bring myself to invest in a company which is a political mouthpiece of some elite group of people who constantly spew venom against those not of the same thinking and belief as them.

Posted by JCool > Sep 14, 2013 08:58 PM | Report Abuse

Kcchongnz... uncle... lets stop d childish name calling cos i m JCool not kuching kurap....

WHO STARTED IT FIRST? READ THIS
Posted by JCool > Sep 8, 2013 01:37 PM | Report Abuse
Who wrote this? Long analysis..... must have spent days weeks or months on it but jz siok sendiri n waste of time Totally useless n no influence on d share price at all

SINCE YOU ARE SO POLITE AND CALL ME UNCLE (SERIOUSLY I AM NOT YOUR UNCLE), DON’T YOU THINK YOU SHOULD RESPECT ME AS YOU KNOW WE ASIANS HAVE VERY GOOD CULTURE, I.E. RESPECT THE ELDERS. BUT OK LAH YOU DON’T RESPECT ME NEVER MIND, BUT DO YOU HAVE TO BE SO SARCASTIC AND CYNICAL?

Uncle seriously.... really la... it is now obvious to me tat u hv not done even d most basic of facts finding before u came up wit ur valuation n going on n on abt how good MFCB is... cos as jackk1 pointed out... d fact tat d two IPP concessions, which by ur own account contribute 76% of MFCB income, r coming to an end by 2017 is clearly stated in MFCB OWN WEDSITE... if u hv checked u wld hv known...

IT IS A GOOD PRACTICE WHEN DOING ANALYSIS. GO DO ALL THOSE THINGS YOU MENTIONED. SEE THE MANAGEMENT, VISIT THE SITE, VISIT A POWER PLANT, DIG INTO THEIR ACCOUNT ETC ETC. BENJAMIN GRAHAM AND PHILIP FISHER MAY HAVE DONE THAT FOR EVERY COMPANY THEY WERE INTERESTED IN THE EARLY 20S. BUT THAT MAY BE JUST A FEW TENTHS COMPANIES THEY DID THAT. NOWADAYS WHOSE JOB IS THAT? WHO ARE THEY? HOW OFTEN THEY DO THAT? YOU THINK THE COMPANY’S MD WILL SIT DOWN AND TALK TO YOU? THEY LET YOU SEE THEIR ACCOUNT? THEY ENTERTAIN YOU SHOWING THEIR PLANT?

SO ALL POWER PLANT OPERATION STOP IN 2017? SURE? ABSOLUTELY NO MORE? SO WHAT IS THE PRESENT VALUE OF THOSE POWER PLANT CASH FLOWS ALL END IN 2017? ADD THE PRESENT VALUE OF OTHER BUSINESS (UNTIL WHEN?), THEIR CASH AND EQUIVALENT AND OTHER NON-OPERATING ASSETS AND WHAT IS THE TOTAL PRESENT VALUE OF ITS SUM OF PARTS?

MY VALUATION IS FLAW, OK, OK OK. SO WHAT IS YOURS?

HEY IF YOU DON’T KNOW HOW TO DO VALUATION, YOU CAN SHOW ME SOME OF YOUR FAVORITE ANALYSTS' ON ANY COMPANY, (BECAUSE I DON’T SEE ANYONE DONE ON MFCB). DESCRIBE TO ME HOW THEY DO THEIR VALUATION, AND HOW GOOD THEY ARE. DO THEY SAY OH ONE PLANT PPA STOPS IN 2017 SO REDUCE EARNINGS BY 50M ETC? ANOTHER ONE COMING SO ADD 40M UNTIL 2030 ETC ETC?

I AM AFRAID THAT MANY ARE EVEN MUCH SIMPLISTIC BY COPYING WHAT THE COMPANY WRITE ABOUT ITS BUSINESS FROM ITS ANNUAL REPORT. HOW DO THEY DO VALUATION? MANY JUST SAY THE PE RATIO SHOULD BE 5, 7.6, 10.5, 10.25, OR WHATEVER.

Asking u to put a disclaimer is for ur own good... cos based tis MFCB case it seems u hv copied d valuation method from a book n jz proceed to fill d blanks without checking...

DISCLAIMER? WAH YOU WANT ME TO ACT AS A BIG TIME CFA, A PROFESSIONAL FROM GOLDMAN SACHS OR WHAT SOLICITING YOU TO BUY SOME SPACS OR SOME OTHER IPOS FROM ME?

I COPY FROM BOOK AND FILL IN THE BLANKS? HEY THE COOL GUY, ARE YOU ABLE TO DO THAT AND SHOW SOME VALUATIONS OF SOME COMPANIES? I THINK EVERYONE HERE IS EAGER TO SEE YOUR CONTRIBUTIONS HERE. SHOW US PLEASE!

Tis is dangerous cos jz imagine someone putting all his money into MFCB based on ur valuation n in 2016 realized too late tat d two IPP concessions wld end next year n MFCB profit n hence share price wld drop by 76%... all his life saving wld b gone... how can u sleep knowing tis...

WOW LOOK ME SO UP. WHENEVER I WRITE ANY STOCK HERE (I DON’T REMEMBER I EVER RECOMMEND PEOPLE TO BUY) PEOPLE HERE WILL CHASE THAT STOCK. WOW! WHY DON’T I WORK FOR GOLDMAN SACHS AND EARNING 50M USD A YEAR AH?

BUT THIS IS A GOOD WARNING ALSO. SO PEOPLE BE VERY CAREFUL ABOUT WHAT I WRITE, OR ELSE YOU BECOME BANKRUPT. BUT BUT BUT, HAVE I ASKED YOU TO BUY? EVEN IF I ASK YOU TO BUY, WHY YOU SO STUPID TO FOLLOW?

Uncle u can stil publish but do put a disclaimer

I AM NOT RELATED TO YOU. DON’T SIMPLY CLAIM THAT.

What I mean is "I don't think it is appropriate to raise the flag". Typo error belw.


Posted by kcchongnz > Sep 14, 2013 08:00 PM | Report Abuse X

Hafiz, I think think it is appropriate to raise the flag. He must be given the right to speak.

Hafiz, I think think it is appropriate to raise the flag. He must be given the right to speak.

Oh, I forgot to ask forumers here. I am sure you are bombarded by tons of research reports from investment banks everyday. You better start asking them if they do all those mentioned by this cool guy here. If not you better do something.

Posted by JCool > Sep 14, 2013 06:55 PM | Report Abuse

Old kuching kurat kcchongnz..... uncle FYI nobody can do a proper valuation of a company without a visit to d company management.. a site visit.. a factory visit..a power plant.. a look into d detailed accounts etc etc etc for facts finding n gathering...... anything short of this approach is jz simply armchair bullsit... o.. with due respect tat is previously wat u r doing

I3 administrator, why you still haven't answer my questions
1do I have to put a disclaimer when putting my valuation of a stock here?
2 do I have to be a CFA to write an analysis in i3?
3 do I have to be licensed with security commission to put up an analysis of a stock here?
4 do I have to be a FAR licensed with Bank Negara put put up a valuation here?
5 do I have to visit the management, the factory, the site, dig through the company's account, ledger, check books etc to make sure everything is correct befor I write anything here?
6 if I don't do all the above, will you inform the police to take me to jail?
7 etc etc etc

No wonder inwest88 say the following so affirmatively:

Posted by inwest88 > Sep 14, 2013 03:12 PM | Report Abuse

kcchong, I reckon you should not waste your valuable time disputing with someone who is far below your league.

Wow,
visit the company management
a site visit
a factory visit
a power plant
a look into the detailed accounts
etc
etc
etc

If not armchair bullsit

Wow, wow, wow. I guess anyone of you want to invest you must follow professional analyst reports. You know those who work for investment banks, each of them just cover one industry, earnings 7 figures a year etc etc etc.

If you don't buy stock following the analyst reports, then you just gamble at your own risk?

Oh I forgot, you still can listen, cheer and shout together with this cool kuching kurat. Then only those stocks you invest can make money.

Got it!

Hey you first call me young man, then uncle uncle uncle, old man. What was your intention. I deserve this

"kcchongnz... firstly i think u deserve all these...... siok sendiri lah, useless lah, copy and paste lah, tipu-pusing lah, bullshit lah, liar lah..... "

Now I think you know nothing at all. You have nothing to show. Just like what inwest88 said below:

Posted by inwest88 > Sep 14, 2013 03:12 PM | Report Abuse
kcchong, I reckon you should not waste your valuable time disputing with someone who is far below your league.

Normally I don't say this. But this is what I am saying now. You are far below my league.

Hafiz, please don't flag anybody here. I think we are getting into better discussion now.

Hey the cool guy, My valuation is too high?How much too high? Show you value and don't just talk.

That assumption of normalized ebit is for the whole company; the two power plants, the limestone quarry and products etc; plus its huge amount of cash and cash equivalent.

So that power plant you are talking about with agreement going to end in 2017, will it just end and MFCB has to pack its pack and go home? Would it be extended? If not how this will affect MFCB free cash flow and intrinsic value? Give numbers. What about the cash flow from the new power plant which is bigger than both of them which MFCB gets? What about he growth of its limestone businesses and property development projects? What about possibility of new power plant operating agreement in view of their track record? Give your figures and valuation, how much. Don't just talk talk only. Understand?

The point I want to say is nobody can predict the future of MFCB's business and cash flow. There are too many unknowns, positives and negatives. We have to depend on what we have now, its track record etc. At least that is how I do. Show us your way then. Don't just query query, kuching kurat. Hey you think I am a know all ah? Are you, kuching kurat?

Of course many of my inputs could be wrong. They are most probably are. Hey kuching kurat, so what are your assumptions? So what is your valuation?

Try show me yours. I can guarantee you I will also be able to question you loads. That I promise, kuching kurat.

Posted by houseofordos > Sep 14, 2013 05:20 PM | Report Abuse
Based on The Edge weekly, Mega First is close to finalizing the concession with Laos authorities to build a hydro plant with 260MW capacity. The power plant is expected to be completed by 2017 and will generate more power than both its existing power plants combined.

See, this is the kind of thing we can learn from others. I know nothing about this. For that matter, i started to write about this stock when another forumer named jaack1 mentioned about it a bout 2 months ago. Before that I never heard of MFCB.

Well done houseofordos.

I hope I don't give the impression that nobody should criticize me. Hey, I am a novice retail investor myself living far away from home now, not of any of the professional analyst working in an investment bank earning my livelihood.

On the contrary, I want people to criticize my analysis constructively. If not how the hell what I have done and what I have invested is good or not? I also want to continue learning about investment and the market.

But is it fair for you to come out with cynical statements and personal attacks like siok sendiri lah, useless lah, copy and paste lah, tipu-pusing lah, bullshit lah, liar lah. If I do that to you, do you like or not?

OK ok ok. you may still do that to me, no probllem, but please provide proofs and facts how I do those things. Isn't it also fair for me to confront you about all those demeaning allegations?

Posted by inwest88 > Sep 14, 2013 03:12 PM | Report Abuse
kcchong, I reckon you should not waste your valuable time disputing with someone who is far below your league.

inwest88, the way he talks, I mean criticize, he must be a very knowledgeable investment professional. Let's give him chance to show us what he have. Maybe we all can learn from him too.

inwest88, as i have said I was just kidding. The list has been finalized and I knew about that. Imagine if Dsonic were have gone down below the price I shouted, do you think I still tell you that I have the intention to join in the competition, although initially I did have that intention?

So you carry on the fun without me. I am watching.

Posted by JCool > Sep 14, 2013 02:53 PM | Report Abuse

HaHa I know a thing or two abt shares valuation la.... Bt jz like u jz dont know d full facts abt MFCB... I refrained from doing d valuation u didn't

SO IT IS WRONG TO DO VALUATION AND POST IN I3? HUH??? OH YOU DO KNOW ABOUT SHARE VALUATION? LETS CARRY ON TALKING. MAY BE I CAN LEARN A BIT FROM YOU.

FIRST HOW WOULD YOU VALUE MFCB? DON'T GIVE ME THE CRAP ABOUT YOU DON'T HAVE THIS AND THAT. JUST MAKE USE OF WHATEVER INFORMATION YOU HAVE OR ASSUME AND GO AHEAD. IN LIFE YOU ARE CONFRONTED WITH A LOT OF UNCERTAINTIES. OFTEN ONE HAS MAKE A DECISION BASED ON WHATEVER YOU HAVE.

TELL YOU WHAT. FINANCE AND INVESTMENT IS AN ART, NOT A SCIENCE. AS LONG AS YOU GIVE REASONABLE ASSUMPTIONS AND DO IT, NOBODY CAN SAY YOU ARE RIGHT OR WRONG. THAT IS WHY I WAS WONDERING AND STILL WONDERING WHAT MY "SERIOUS FLAWS" AS CLAIMED BY YOU ARE.

I HAVE ALREADY GIVEN AT LEAST THREE METHODS OF VALUATIONS IN THAT THREAD FOR VALUATION OF MFCB. FOR YOUR INFORMATION, THOSE ARE VERY COMMON VALUATION METHODS USED BY ESTABLISHED VALUE INVESTORS. COME ON, SHOW THAT YOU KNOW SOMETHING (IN FACT MUST BE DAMN GOOD) TO CRITICIZE ME LIKE BELOW.

Posted by JCool > Sep 8, 2013 01:37 PM | Report Abuse
Who wrote this? Long analysis..... must have spent days weeks or months on it but jz siok sendiri n waste of time Totally useless n no influence on d share price

I bot MFCB after d land concessions cos I trust MFCB management to know a good deal whn they c one.... u on d otherhand is not consistent.... praising d management for good job n invested ib MFCB... thn at d same time questioning if thy know rubber or nit... know Combodia or not... make up ur mind or r u out of ur mind??

NO, I AM NOT QUESTIONING THE MANAGEMENT DECISION IN BUYING THE LAND IN CAMBODIA. IF YOU READ THROUGH SOMEBODY'S QUESTION ON THAT TO ME, I SAID I AM NOT SURE IF IT IS GOOD OR NOT. IT IS STILL TOO EARLY TO TELL.

I WAS QUESTIONING YOUR LOGIC OF BUYING THE SHARE WHEN A COMPANY BUY SOMETHING. WHAT KIND OF LOGIC IS THAT? ARE YOU SURE (NOT WHETHER THE MANAGEMENT IS SURE) THIS IS GOOD? IF IT IS SO HOW DO YOU COME OUT WITH THAT CONCLUSION? ARE YOU OUT OF YOUR MIND?

Putting a disclaimer is for ur own good n ur loves good la

DISCLAIMER FOR MY OWN GOOD? WHAT GOOD? I AM NOT A CFA ADVISING INSTITUTIONAL INVESTORS TO BUY MFCB. I AM NOT A FINANCIAL ADVISER LICENSED WITH SECURITY COMMISSION AND ADVISING YOU TO BUY THIS SHARE. YOU WANT ME TO ACT LIKE A PROFESSIONAL HERE AH? WHAT FOR? HEY THIS I3 IS JUST A FORUM TO SHARE INVESTMENT IDEAS.

Posted by JCool > Sep 14, 2013 01:16 PM | Report Abuse

KCCHONGNZ... U DONT KNOW D FACT YET U DID N PUBLISED UR VALUATION... TAT IS D PROBLEM!!!! RECKLESS!! YOUNG MAN.. BETTER CHECK UR YOUTHFUL GUNG-HO......

Hey i don't know the fact? Can you understand my report or not? Cannot publish in i3 ah? Hey i3 administrator, can I publish my stuff here or not?

Reckless? Huh??? Wah write something in i3 to share also reckless ah? Gung-ho? Is the report or valuations very gung-ho ah? You know how to read or not? I thought I used the most conservative assumptions.

Young man? How old are you?

NOT ME COS I ALREADY SAID I DON'T KNOW N I REFRAINED TO DO ANY VALUATION N LEAVE IT TO D PROFESSIONAL...

Hey get your professional friends to write his report here. I guarantee you I will post many constructive comments. Not just simply claimed by you without any fact.

FRANKLY D FIGURES TAT I M INTERESTED IN IS D 36-25-35 TYPE.. HAHA

You still think that you have come to the right place? Are you out of your mind?

Ok la u r doing some soft of community work here.. tat is good.... but do put a DISCLAIMER in every ones of ur write ups

Wah, writing in i3 also need disclaimer one ah? i3 administrator, is it so ah???? Hey you think I am a CFA from an investment bank recommending stocks to institutional investors ah?