I saw your posting here and checked the Annual Report @ 31 Dec 14. I missed seeing Famous shareholder Coldeye “Fong siling” as a shareholder according to their annual report. Is it under one of the companies mentioned?

I looked at this stock because it was picked out under Metastock's Oversold Momentum Filter which I use to see what stocks had been sold off at a very high intensity. Very often we can find some which were unduly sold due to unfounded rumours etc. I also checked the financials which is OK.

In UMS case, the last quarterly results must have affected the company and recent Ringgit appreciation also accelerated the sell down.

For a company like UMS, they are providing what I call, a "commodity"product as there is really no "rocket science"involved. In such instances, the only way for the company to grow is to have a really good marketing team and knowledge of how to differentiate their products. Look at tooth brush manufacturers and you will know what I mean.

The amount of cash in their coffers is good and the company should consider either investing it for future income growth (which is difficult as it is in a matured industry ) or consider to provide higher dividends. The latter will give generate some interest in the company. They can also consider giving Bonus issue as there is RM38.92 Million Retained Profits in their Balance Sheet.

With regards to TPPA, Malaysia will face competitors like Vietnam whose productivity is growing as the people there are very hard working.

I conclude that while the balance sheet of this company is good, growth prospects will not be great given that they do not have any significant competitive advantage in a "commodity"product.

The effects of the USD receipts which may be smaller for the quarter ended 31 Mar 2016 may affect its profits.

Nevertheless, at a current PE of around 8 (using price of 0.91 divided by EPS of 0.12 per the last quarter results ), it is not expensive. Question is what are the growth prospects going forward to attract Investors? They are in a market where there are a lot of Competitors

Technically the share seems to not have found a support level yet based on the weekly chart. It hit a double top end Jan and Feb and started dropping since the results were announced on 24/2. Recently tried to recover when it dropped to 0.89 but this was short lived. On 1/4 there were no trades.

The free float of this company is less than 20% which may have caused the illiquid status now.

The 0.89 level may be the tested again and if that does not hold 0.845 beckons.

I like houdini's comments

I have always advocated that if one is not agreeable to what others post, they should come out with good and well thought out reasons to disagree. However it is disappointing that there will always be some who disagree with no good reasons whatsoever. It seems that they take pride in showing their ignorance rather than showing their intelligence.

I agree with kmohan62 comments about ignoring such people because they have nothing better to do but disagree for the sake of disagreeing or attacking others for the sake of having something to say. Is it that they are perennially lonely people who need a shrink?

Mr Koon had been sharing his views on the export stocks, VS and Latitude Tree way before USD1 = RM3.80+ now and there have been people attacking him whenever he shares it, for vague and imaginative reasons.

Those who sold VS especially will certainly feel a tinge of regret now but there is no reason to regret because the market is always there and one can always make money in the markets if one has developed good investing skills.

Anyway Mr Koon has shown his sincerity in sharing good things with all in this community and one should at least show him some respect for that.

The problem I see is that when people cannot accept other people's views and always insist they are right, that is when the problem starts.

I always believe that there is more than one view in life unless it is so black and white that you cannot argue with that. One must learn to Agree to Disagree. If you strongly believe that leveraging is bad, so be it and present your arguments and that is that and vice versa; no point to continue talking about it.

Thank you for allowing me to share. Have a good weekend

Apologies, my KPJ check out date was 26 Mar 2015 not 2015..1 day stay not 1 year!

NOBY,

Sometimes, there are opportunities I buy when I see the stock cannot go down anymore. I am more of a range trader between support and resistance as I am "kiasu". Currently the market is sideways and I am looking for opportunities like that but now because of the headwinds of our economy and USD interest rate normalisation, I got to be more careful as support may not hold

NOBY,

Thank you for your comment no. 2

I said above : "Also do we use our experiences to invest?"

Last year I was admitted into a KPJ hospital on 25 March 2014, discharged on 26 Mar 2015 as I was quite sick on 25 March 2014. I had to wait 3 hours or more in the emergency room before I was allocated a room because they told me the hospital is full and I have to wait as someone was checking out later that day. As I waited in the Emergency room, I saw that it was full and people did not even have a place to sit.

This shows that it is a very good business that is "printing" money for its Investors. A good businessman will want to get into such a business.

I have never invested in KPJ shares before and later after I was discharged, I had a look at the KPJ chart and was amazed that it was falling like a "Waterfall". I was wondering why, is it because they have some very bad results because of bad management or did something crazy?

On checking, I found out that Analysts were writing bad things about them because they took a lot of loans to build new hospitals in Rawang, etc, causing the usual financial guidelines to appear to be bad. This I cannot understand why a company that is taking loans to grow its business is treated as a bad thing. If it took loans to buy luxurious cars and villas, I can understand. If the financials are bad, then it should only be temporary.

If one check the charts, one can see that a base was formed at the RM2.99/3.00 level between 26/3 to 8/4 and volume increased from 01 April 2014 with the share price, not able to fall further. This gave a good signal that strong support is present and the share "should" rise from there. From 9/4 onwards the share rose and never looked back, reaching RM4.42 on 8 June 15.

That is using your 5 senses to invest together with understanding TA. FA is important but at that stage I felt that the growth prospects of the company is far more evident than short term financial numbers.

Life is short, do not be uptight when someone disagree with you. They have reasons best known to them and if anyone disagree with others, that person should be prepared to give good logical reasons for the view. That shows you are a matured, thinking person who can give good logical reasons behind your views.

We all learn together and get better, that should be the aim of life but if you get emotional over what others say about your views, then you should go and learn to Agree to Disagree.

pisanggoreng,Thank you for your frank comments. I have no problem with your comments. If you have nothing new to learn, it is ok with me.

Agreed with Mr OTB that a person who is good will not tell lies and attack people to say he is very good. That is a universal principle that I subscribe to.

But just wondering the relevance of this statement to what I posted here. Kindly explain.

After all, I did say that I created this forum for intelligent discussion and any disagreement to what I proffer here is most welcomed as no one stops learning and I have said that I agree to disagree.

Continuation

3) The missing part of the linkage of FINANCIAL FIGURES and ECONOMICAL CHANGE because it would be great to learn from you how to integrate these two scopes since Economy will influential the Finance figures after certain period. Hope your experience and MBA thoughts can enlighten us

COMMENT
The Economy is the overall picture. If the economy is bad, how can companies that are affected by the consumers’ change of spending habits do well? Obviously their financials will be affected. If they were doing well over the last 5 years, it does not mean that such stocks will do well in future. Hence it is time to look into selling these stocks.

Oil & Gas counters are being affected by the turmoil in the global markets but their 5 year EPS and 5 year revenue growth rates may show scintillating results. Will you go and blindly buy them, thinking that the norm will continue forever?

Just some thoughts here :

Consumers who are wage earners will not be able to spend luxuriously. Hence one must ask, what kind of goods will they buy? Will they buy more gold ornaments, will they go for expensive holidays? What counters will be able to withstand the economic downturn?

With these questions in mind, we go and look at the market. I will say that most likely those that have business that are, recession proof will continue to do well. They are not exciting businesses but ones that will not do badly even if the Ringgit go to RM6 to USD1. Example : One of the most recession proof business is the bereavement business (Funeral). Unfortunately, if I am not wrong that company had been delisted as the founders found that the local market did not appreciate the company’s value.

Also companies that sell basic food products that are needed like Nestle. in Indonesia Nestle sell coffee saches and food packages like maggie mee individually so that the poor folks there buy just for the day's meal, not like here where we buy enough to stock up for 1 month! The profit of each packet is so high that it is a sin!

Medical service providers is another good example. As the Government hospitals get more and more crowded and people in general have health or medical insurance, they will go to the private hospitals. So I believe that private hospital business will continue to grow.

Motor vehicles - in Malaysia, without a car, you are in trouble. Most of the population will be able to afford a Myvi which is perceived to be better than a Proton. So that is another area to look at. Of course there are also challenges in this industry that one must be aware of.

These are just some areas. Note that we are not living in a coconut shell, business is global and also there are loads of foreign investors in our market. If they leave, what counters will be affected? Air Asia is a good example. If you do some homework, you will know which companies have a lot of foreign shareholding and you will want to avoid those companies.

Dear duitKWSPkita

Let me go thru your comments one by one :

1) What should we do when TA contradict with the FA findings for short term analysis since more n more CLOUD BUSINESS or E-Comm counters to be listed in stock exchange (problem here is TA ask to attack while FA ask to wait)

COMMENT
This is common - it depends on what stocks you are looking at and what is your investment time frame. I personally have invested in penny stocks when my interpretation of TA on the charts show that entry is possible as the probability of the share going up is higher than the share coming down. Note that this is mainly for short term profits. In this respect, there is hardly any FA involved - eg of shares I have personally invested in are Pasukhas, Asia Bio & KTB where the FA or business process of the companies will not have qualified as an investment. Of course, I may get it wrong and that is when I have to quickly get out admitting I am wrong.

2) What is the ROBUST way to read our market when KLCI(30 components) is not usable to reflect the entire market movement.

COMMENT
The KLCI is just a guide to the health of the market . What is missing which is much spoken about is the Breadth of the market – ie how many stocks up, down and sideways and volume. That is more crucial. The KLCI does in a way influence the sentiment but if you know the companies that you have invested in after applying the 3 techniques mentioned, will you be worried? You will look at it as an opportunity to BUY not SELL the stocks you have in your hand.

But if you are only having speculative counters, then you will be extremely worried indeed. You just have to be careful of your own stocks. I have said this before to my Kiasutrader community (www.kiasutrader.com), not to be worried about the market, but be worried about the shares you own - are they solid, can they withstand the sudden loss of confidence in the market? Can they bounce back? Normally those stocks with good fundamentals can bounce back, not the speculative ones.

That is another big area where emotional trading has caused many to fail. May write about it another time, including why TIPS may or may not make you rich...

Thank you to all for the encouragement. More to come

Anyone can visit our website at www.kiasutrader.com to have an understanding of TA and FA applied to stocks

Wait for Buy signal which one should also take into consideration the overall situation in the market

Just a note. Whether a share is cheap or not, one must value in relation to what the company can perform at, not just price alone. A bad company can never consistently command a good price, neither will a good company be forever "down".

Hence, when one thinks the share is already "cheap", it can be cheaper still or if one thinks that it is expensive, it can be more expensive.

Investment in the stock markets is not an easy game. Once all the participants panic or participate in irrational exuberance, that is when one should do detailed homework and ask whether the share is worth xxx or yyy.

After all, it is your money you are putting down

Sbg3106.thank you for your query.
Please contact me at kiasutrader@gmail.com to discuss further

We have uploaded our analysis on Frontken in the technical analysis section of the website, www.kiasutrader.com. We provided this analysis to our Club Members on 29 May 2015.

We can be contacted at kiasutrader@gmail.com for further discussions

Tips88. Kindly advise how you see strong support 0.22 to 0.23 range? Thanks

xuewen, it is not my intention to tell you to buy or not to buy. My intention is to share that in any situation, one should not be blinded by what appears to be obvious. Beyond just looking at the placement price, look at the facts regarding the company and the rationale behind someone willing to pay RM3.85 per share. Is this instead a "plan" for the rest of the Retailers to sell, sell & sell so that the Insiders can collect more?.

Forgive me, but I am tempted to quote Sun Tzu again :

“If your enemy is secure at all points, be prepared for him. If he is in superior strength, evade him. If your opponent is temperamental, seek to irritate him. Pretend to be weak, that he may grow arrogant. If he is taking his ease, give him no rest. If his forces are united, separate them. If sovereign and subject are in accord, put division between them. Attack him where he is unprepared, appear where you are not expected.”

See what Sun Tzu says and you will know what I mean. I like that part about "Pretend to be weak, that he may grow arrogant".

Coming back to VS, let me ask a question, if indeed the share is only worth RM3.85 which is the price that the new Investor paid for the 20 million shares, then if the share does drop to that price, will you buy? Most likely if the market is bad at that point in time, you will also not buy because like what I said about personal preservation of self, you will be worried that the share will drop further.

Entry and exit in any counter should not be based on what we or any person who writes here say so. It should be made after you have done your own homework and whether you have the means to carry the losses if it happens.

I am not authorised by SC to provide investment advice and all my sharing is for discussion purposes only, so I do not give tips or entry or exit prices. I do however, encourage all to learn TA, FA and entrepreneurship, where the latter will enable you to go beyond the numbers crunched out by historical FA alone.

If you wish to continue discussing with me, do contact me at kiasutrader@gmail.com or thru my website at www.kiasutrader.com

To add to Mr Ooi's comments :

Yesterday, ,many shareholders were disappointed and sold aggressively as if the price will fall further the next day. As a result, the share price dropped 0.21 sen to close at RM 4.13. The sellers must have felt that the company was not fair to them to sell so many shares with a discount of about 10% to those who may in turn, sell them to make a quick profit.

Fear and anger that the price might drop further are natural human reaction in share investment. This is where the “rational” mind takes over and flight to “safety” and personal preservation which are God given instincts takes over without considering any other factors that might be behind the scene.

I always believe that in any situation, one must not follow the “herd” and get trampled in the process. Do think outside the box in any given situation. Sun Tzu’s famous words come to mind :

“If you know your enemies and know yourself, you will not be imperiled in a hundred battles…. If you do not know your enemies nor yourself, you will be imperiled in every battle”.

I also noted what Mr Ooi mentioned about the new placement that will generate cash for the company. I see this as good strategy as the company’s market capitalization will increase and this is using paper to “print” money which is an intelligent way to expand business operations and reduce debt permitted by Bursa Malaysia. Hence I see this as a good corporate strategy to raise cash without going to the shareholders for a rights issue.

After having studied the details of VS Industry and compare it with MPI and Globtronics, I believe the investors who took up the shares are not fools. They will have noted that :-

Net Income after taxes for FYE 2014 is only RM 53.6M after minority interests. For the first half of this year, the income after taxes (unaudited) is already RM 51.4 M. If one were to use a straight line basis, the income after tax will be around RM102.8M which is nearly double that of the previous year. With the reduced borrowings (less interest costs) and weakening of the Ringgit against the US Dollar, it will not be a surprise that the company will do much better this year than last year.

It should be noted that if the new Investors were to sell the shares immediately, it will cause the share price to drop drastically and that is not what the new Investor will want to happen. Also there may be borrowings involved and having “forked” out so much cash to buy the shares, will the new Investor be happy with a minimal return? These are some questions to ask before you throw your shares and expect the share price to drop to 3.85.

There may be more to come from VSIB in the near future.

Clue : Who is the new Investor who is so willing to pay so much money and take so much risk?

Just a note about theories and applications.

1. In all business schools, MBA students are informed that gearing is efficient as more can be achieved above one's capital, provided of course you use such borrowings effectively and not to buy the latest penthouse in New York or London and get miniscule returns. Hence coming back to individual investors, one must have the knowledge and confidence to use borrowings to make more money than the interest charges.

For the companies, we can see this in the interest cover ratio which is a number to show how many times the interest is covered by the company's EBIT. the explanation is (see www.investopedia.com/university/ratios/debt/ratio5.asp) which I quote below :

"The interest coverage ratio is used to determine how easily a company can pay interest expenses on outstanding debt. The ratio is calculated by dividing a company's earnings before interest and taxes (EBIT) by the company's interest expenses for the same period".

Not many people talk about this ratio but do use it when you want to analyse the company's capability to at least pay interest.

2. Audited accounts are only a historical record and just basing on this to buy shares can be disappointing if the future operation is different from the past. But how can we tell the future? This is easier said than done as there are many market signals that one can see. For example, the apparently good profit could be from pre sold properties at much higher prices but the current market is not so bright. It will be foolish to buy property share in view of the slow sales. For your information, I get all sorts of SMS and whatsapp messages offering me good discounts to new launches. If the property market is so hot, why am I getting such great offers?

Also O & G companies are reporting huge profits, should you go and Buy, Buy and Buy now? Maybe you are a contrarian with loads of money but for me, I rather use my capital more effectively.

If one just followed the numbers without thinking, then that is not very wise indeed.

3. I have been thru many cycles of the market, up and down and I now realise that one must invest like an entrepreneur and a business man. I have been wondering how Mr Koon became the substantial shareholder of Latitude, VS Industry and Lii Hen. The 2014 annual report of Lii Hen shows that Mr Koon is the 2nd largest shareholder beside the controlling shareholder. Lii Hen just announced its 1st quarter earning of 18 sen per share and that is why share price is shooting up.

Hence he must have used his business skills instead of static numbers to consider investing. Mr Koon also encourage others to use leverage as the rate of interest is so low and if one did choose a good fundamental stock with good future prospects, even the dividends are able to repay the loan interest. Remember the interest cover ratio? The EBIT is your earnings before interest and tax.

4. There is one more point that people fail to understand about investment and I do not see it posted anywhere on i3investor. That is the people running the company. One must ask, is the majority shareholder, a real entrepreneur, shrewd businessman who cares about his reputation and company's well being or is he a corporate player and paper shuffler? Those of us who are old enough will know who these people are and one can see that the companies owned by the latter can never rise in price because the Fund Managers do not trust what they say, despite also whatever good results are posted in the financial statements.

In this regard, one must look at all the items (1) to (4) if one want to be successful as an Investor. It is not so simple as to just derive cashflows, ratios and what not from the company's financial statements and audited accounts which at best should be used as a guide only in any investment decisions. Hence never use such instruments as a conclusive factor as to invest or not to invest.

I certainly do not.

Thanks again and I have said my piece. As usual, I certainly welcome any comments to me thru my email : kiasutrader@gmail.com or you can visit my website at www.kiasutrader.com

It is important that whatever you use, you use it well. To say that the PE ratio is too simplistic is not correct, KC.

Worldwide, that is the yardstick for investment decisions, including the EV/EBITDA. The latter captures the debt of a company as well. As I said earlier in one of my postings, high debt need not necessarily be a bad thing if used judiciously and also one must look at the structure of debt, is it long term debt or short term debt. Such things cannot be captured by a simplistic cashflow analysis based on past results or a DCF model. This is not to "attack" you for using the DCF model. As I said, I always wnat to "Agree to Disagree".

Suffice to say, there are loads of stuff to consider when pursuing investment opportunities; if not why are business schools like Harvard, London Business School and the like flourishing.

For your information, I was given a place in the London School of Economics to do my MA which I am very proud of but never went as I accepted a scholarship from Queen's University, Canada instead. I was also offered employment by the NUS, Singapore after my Masters. Subsequently while working, I was given the opportunity by my Employer to pursue my MBA which I completed.

After going thru all that head shrinking process, I realise that the real world is very much different from the elevated thrones of high finance and theories. Hence, I am now a more "Balanced" guy who look at investment opportunities not thru one window of "high finance" alone.

Use everything as a guide, not Gospel Truth as such is the way to go, to be successful.

That is all I want to post on this topic and thanks for allowing me to discuss this matter.

Thank you Mr Koon. We need more people like you in our society today, We know for sure that many qualified students cannot get Government scholarships and you have made your wealth available to help them.

May God bless you and your family for your generosity!

I note that many who post on i3investor forum do not know how to Agree to Disagree or have any understanding on how to express themselves other than shout on top of their voices to say that they are right. These uncultured few are like many in our society today, demanding this and that when they cannot even give a logical explanation to support their views.

If anyone does not agree with what is shared, then tell why, not come out with hurtful words which shows the kind of person you are.

Remember No One, yes, NO ONE, force you to buy any of the shares mentioned by Mr Koon and if you did lose money, you are to blame because you did it blindly and did not bother to analyse yourself when you entered and possibly, did not know when to exit. This is the problem with retail Investors, they just want tips and are lazy to learn how to invest.

To invest properly in stocks and shares, one must have the basic understanding of financial statements, that, although is useful need not necessarily be a prerequisite as to be a skillful investor, it is one who can understand where the business of the company is going and knowing when to buy and when to sell. No point knowing when to buy and regret that you did not sell at an opportune time.

Financial statements are past results and there is no guarantee that the future will be the same. Also one must understand what industry the company is in, the intricacies of the business and so on. Hence, following financial statements and ratios blindly is the worse thing one can do. The list can go on and on and I am not about to embark on a MBA lecture here.

What I am trying to say is that, do not be blinded by what appears to be rational. The smartest people in the corporate world are "rational" but they very often are not successful Investors themselves. There is a reason to that and this is not the forum to discuss it. Suffice for me to say that in whatever you do, recognise the limitations of the system you are using and do not blindly follow it as though it is "Gospel Truth".

In addition, points of entry and exit can be ascertained with some probability if one understand Technical Analysis and use the charts skillfully and successfully. It is no point to enter a "Value Stock" (based on all the analysis from present and future cashflow to static ratios) at RMXXX price for example when it is at the top of the chart and "distribution" is happening. Entry at accumulation or support phase is better for profitability. No one wants to pay more for anything if it can be obtained cheaper later. However if you do intend to be a long term investor then entry at whatever price does not matter to you.

My point is that do not be constrained and think that there is only one way to be successful in investing, or think that only educated people who know how to read financial statements will be successful Investors. I have met many who do not understand any financial ratios at all but are far more attuned to the market and know when to enter and exit and make tons of money.

Lastly, I leave this real world finding for all to ponder :

"Researchers at three major universities - Stanford, Carnegie Mellon and the University of Iowa - published findings showing that brain-damaged individuals made better investment decisions than the rest of us.

To be precise, what they studied was the impact of injuries that prevented the brains of the injured from processing emotional stimuli and, by implication, responses to those specific inputs.

Researchers found that when they compared the findings to folks with no brain damage, the "injured" individuals made significantly better investment decisions".

Strange is it not?

I can be contacted at kiasutrader@gmail.com or thru my website at www.kiasutrader.com

Happy Trading

By the way, there is another kiasutrader on this forum. I am not the one, so I use kiasutrader1. Just to clarify.

One must learn to Agree to Disagree. Some who write on this,website write absolute nonsense. Alternative views are the source of learning. It polishes your debating skills and makes you think more.

I personally do not use DCF to tell me whether to buy or not. If you do, then you are,at liberty to.

I stick to simplier stuff especially "looking behind the numbers" i.e. understanding why certain numbers presented in the financials are what they are. Should we buy when great numbers are presented and sell when it is the reverse? A skillful investor will know where to look.

So, I am not put off by high gearing or low ROE & ROA. What is most important is having an understanding of business processes which certainly works for me, including an understanding and application of FA & IA.

As I said, anyone who agree or disagree with me can write to me at kiasutrader@gmail.com or visit my website at www.kiasutrader.com

Good discussion

Just to conclude on this, as a contract manufacturer, the competitive advantage is when you are close to your customers. If you have been supplying goods as and when your clients want them and meet their needs as well as having little or no defects, then you have a "captured" customer. If you fool around and cut corners, you will surely lose your clients. Also if you can keep up with your Clients' needs as and when required with little turnover time to get the stuff at your Clients' doorstep, that is another competitive advantage.

Note also that to change suppliers when one is doing well for you does not make much business sense and there is also a risk on product quality as mentioned above.

Cost is not the only consideration when "employing" a contractor.

All I can say from my experience is that if companies did not borrow, we will not have the "coca colas", "BP", "Perlis Plantations" of today. Neither will economies progress as the GDP depends on the velocity of money flow to generate income and prosperity

Agreed that a cash cow company is a good defensive play. Depending on a company's life cycle, at various stages, it needs to borrow to grow exponentially or else it will not gain market shares or meet orders from Clients.

Low ROE is of concern or course but one must go behind the numbers to find out why. For new machineries to be installed, it takes time for them to generate income as there may be glitches along the way to fine tune the machinery to produce at optimal capacity. If new machinery were bought in anticipation of new business orders or if they were bought as a result of current inability to meet demand, that is a good thing.

Growth companies normally have more needs for borrowings than matured companies like Robert Kuok's. Hence, "going behind the numbers" is important to understand where a company is at.

Also numbers can be different taking different assumptions. If we had taken the diluted weighed average number of shares (the company increased its paid up capital over the last 3 quarters) like what Thomson Reuters did, the P/E ratio is even lower at around 8.8. Hence depending what number you use, the perception can be very different.

Having an understanding of what the company does and where its business prospects are "beats" just using numbers only. This I learnt from my years of experience in the "real" world.

Mr Chong, I always believed that whatever conclusions about whether to buy or sell a stock must be based on a rational approach. whether it be fundamental or technical.

I must congratulate you for your detailed work but as any corporate finance professional will admit, which you have also done, is to take assumptions of the growth rate etc. in your work to come to a fair value of V S.

That said, I am providing herein an alternative view rather than using DCF which, in a way is a lot less technical and easier to understand as to what is the possible value of V S going forward. Please note that it is not to refute your findings as we are employing different approaches to arrive at some conclusion, whether it is right or wrong, time will tell. My ego is not so big as to be right all the time, so I have no issues if I am wrong.

Firstly, I think you should pay particular attention to the discount rate which, if changed, can also change your conclusions. Why for example, did you use a discount factor of 10% which is exceptionally high given that bank deposit rates are hardly 4%. Even EPF gave only 6.75% which is quite high and may not be sustainable. I surmise that one should use a discount rate that represents an opportunity cost of capital for a normal individual investor, which should be more accurate as a measure of employment of one's capital to earn a return. Nevertheless, you are at liberty to use whatever rate you want.

Another point about increased gearing and expenditure on fixed assets which is affecting its cashflow. If the company is borrowing money for future income, there is no harm in doing that; but if it is borrowing for the sake of buying new non revenue generating assets like the latest Porsche or Mercedes, then there is definite harm to the company as a going concern.

A detailed analysis of the firm's balance sheet will show that its long term debt is falling as a result of timely repayments. A lot of its debt is short term in nature, given that it is in trading which requires trade lines and Overdrafts. Trade lines in particular are self liquidating and a very cost effective way of borrowing. Hence as long as the company continue to be prudent and do not have large amount of Bad Debts, there is no risk to the company's business at all. In this regard, there are no bad debts written off in the company's financials.

The cash in bank is also impressive at RM 201.75 Million @ 31 Jan 2015 compared to 6 months ago when it was only RM 123.464 Million. Note that the cash is more than enough to cover for its long term loans of about RM 135 Million.

In the latest unaudited results as at 31 Jan 2015, the following based on 12 months from 31 Jan 14 to 31 Jan 15 (some call this "rolling" = RM 93.8 M) are observed :

EPS on total number of shares of 205.3M = 0.4568
Current Price = 4.25 implying a current P/E of 9.30,

Just taking a P/E of 11 will equal to a share price of RM 5.02. I take the liberty of using 11 of course.

As at half year 31 Jan 15 :
The Revenue is RM 1.010 Billion (FYE 2014 12 months = RM 1.715 Billion)
Net Profit After Tax is RM 51.4 Million (FYE 2014 12 months = RM 46.67 Million)

Assuming a straight line basis, NPAT for FYE 2015 should be around RM 102.8 Million, If that is reached, its EPS will be 0.5034 and using a P/E of 11 = RM 5.537 per share

Just by comparing these figures, one can see that V S will do much better this year than last year.

Whether or not this is sustainable totally depends on their Managers' business acumen and market conditions going forward. This will be another study altogether as to whether the current Directors are up to the mark in employing their business strategies effectively. After all, at the end of the day, a business is only worth what it is, if it is run by able and capable Managers who are attuned the needs of the market place. Past performance have no relevance to the future as business is dynamic not static

Understandably, the analysis here is not akin to what you have proffered but it is a way in which we can come to a simple understanding of what the company should be trading at.

I welcome any comments from you and you can contact me at kiasutrader@gmail.com

By the way, TA is an art not a science, it is a matter of probability where a stock is heading. If you see it is good to buy after considering the facts of the matter, go ahead and buy. There is no ego trip here to say I am right and you are wrong.

All of you must learn to agree to disagree. As I said, if you have good reasons, both TA and FA, please go and buy. One must buy with good reasons. That is all. I have mine and you have yours. I have no arguments with anyone on this point. Time will tell

I still cannot understand why some are very bullish on Asiapac when the quarterly results show otherwise. Nevertheless, if you have good solid reasons, both TA and FA to hold Asiapac in the face of a deteriorating property market, then, just go ahead.

It is interesting to note that some of the comments here point to future business of Asiapac - re the Imago Mall. With the GST, consumers are more careful how they spend. Also do you think the mall can afford to charge high rental? Also, Mall operations reported a negative RM4 which is an increase from last year. Property development income is also winding down.

I suggest all to download the recent results of Asiapac and read thru it carefully. Also since all here like to use charts, the gap up the other day was a definite SELL volume. Those who want to see my full report and register as a Club Member at www.kiasutrader.com. Cheers

To invest in any stock, look at the fundamentals as well as the technical charts to come to a conclusion. Anything more than that is pure conjecture. With due respect to sweetheart, whether or not there is a RTO, one cannot predict, only Insiders know. If they know, will they tell the whole world? Insiders tell only if they want you to Buy so that they can sell.

We did a full analysis on Asiapac in our website, www.kiasutrader.con for our Premier Club Members.

Again, let us consider the facts of the matter. Last year, I invested in KPJ Healthcare when no one wanted to invest and all Analysts were "killing" the share. I invested because I had the unfortunate (maybe fortunate!) experience of getting admitted in a KPJ Hospital near my house. I had to wait 3 hours before getting admitted and not only that, I saw queues of people at the outpatient and also the carparks, day and night are full of cars. It is like a popular restaurant where no one cares what the price is and simple "hantam" because the food is fabulous. So I checked out the charts. Lo and behold, it was falling like a waterfall. Now, I checked online all the reports on KPJ and all the Analysts were saying that the results will be poor because the company tool a lot of loans and they are taking that to construct new hospitals in Rawang and a couple of other places. Now if a loan is taken to expand one's lucrative business, it is different from taking a loan to buy a Mercedes for "sendiri shock" only! One generates future income, the other generates future depreciation with no value added to revenue or profits for that matter. I bought at RM2.98, RM3.00, RM3.01. Within a short time, the share rose to RM4.00 and today, it is at 4.23. So use your common sense to invest and if you have an understanding of charts, fundamental analysis, etc, it will do you well. Do not believe that the Analysts are smarter than you. If they were, they will be Millionaires and not working for a stock broking firm in Malaysia as they have all their TPs lined up to make money!

Mr Koon's scholarship have no ties to working for him or anyone, that is what makes this a philanthropy rather than a scholarship with ties to work until you are no longer useful! Also unlike JPA, there are no quotas involved!

Before anyone criticise Mr Koon, One should consider the facts. First of all, all companies involved in the O&G industry will have their earnings impacted this year and possibly the next. FAVCO is selling O&G Cranes of Offshore Exploration & Production (ask yourself, will this business expand this year and the next?). The remainder of the order book is from the shipyard, construction and turbine industry. Purchase orders have a lead time of about 2 years, which means that income can only be generated in 2 years time after receiving an order which is normal as no one will pay any money if the product is not ready yet. Hence for FAVCO to be successful, they must continue to get new orders faster than the previous years to do better this year than last year. In this regard, FAVCO have only RM967 Million which is 13.1% lower than RM1.1B for the same period last year. So if the core component of your business is NOT generating new orders, what will happen in the near future? Common sense will tell you that if you are selling in a market that no one wants (eg NOKIA Handphones as opposed to Smart phones), your business will suffer. Bankers and Analysts always base their assessment on past achievements and results, like as though that the norm will last forever. Unfortunately, after spending more than 35 years in the finance industry, I personally have seen how this thinking is flawed. I applaud Mr Koon for writing this article as I believe that many new Investors will gain from his input of using your common sense to invest! If anyone have lost money because of what Mr Koon wrote, it is their fault because NO ONE forced you to invest and NO ONE forced you to sell to cut loss. Think about that before you write anything disparaging about any contributions from anyone here. One must learn how to AGREE to DISAGREE and that is the way to succeed in life, not shouting your mouth off without any backing of the facts of the matter.

Note that Bullish Harami patterns are one of the most difficult to trade. I have some examples under the TA section on my website, www.kiasutrader.com. I noted it for MyEG sometime ago.

Today the candlestick shows a Bullish Harami. Anyone who knows how to trade this pattern will know when to enter

The reason why IFCAMSC dropped is because the CFO resigned and any talk of the person in charge of Finance resigning for no reason (company offered an explanation that he is leaving to pursue own interest) offers rumour mongers a chance to sell down the stock. This was reported in the Star on Monday : http://www.thestar.com.my/Business/Business-News/2015/05/25/IFCA-MSC-slumps-after-CFO-resigns/?style=biz

The company subsequently came out with a statement that Chow Chee Keng who was the former CFO between 1 Feb 2013 to 31 Dec 2014, after which he became head of training division and now back to his old job taking over from Voon. Why did Voon leave after only been in the job for less than 6 months? Did he find something there that is not to his professional liking?

We analysed this stock on 20 June and mentioned to our Kiasutrader Premier Club Members (in www.kiasutrader.com) hat a Buy is on the cards for this stock.

We provided our analysis on KPJ sometime ago on our website, www.kiasutrader.com on using EOD data @ 02 April 14 when it was hovering around 2.99/3.00, recommending a Buy.

At that time every analyst in town was predicting doom and gloom, not realising that the company borrowed money to build new hospitals that take time to generate income. 2 days ago, 24 June, we advised our Kiasutrader Premier Club Members to sell the stock as it was toppish. We will continue to monitor this stock for entry levels.

We received an email from this yahoo username InvestKCL that we cannot reply to, despite trying 4 times, with regards to registering for the 3rd session of the seminar on Sunday 1 June 2014.

Please write to us again and provide your handphone number, full name and email address (non yahoo please) that we can reply to.

Thank you

Someone contacted me (kiasutrader@gmail.com) to register for the afternoon session for Mr Koon's seminar on Sunday 1 June using email username InvestKCL but the email address is not reply-able. Please re-submit. Thanks

westdeap12, please write to us as to which session you wish to attend. The 3rd session is where I will also be presenting after Mr Koon.

To Johnny cash - Mudajaya is an excellent company that one should consider investing in

In a bullish environment, rationale gets thrown out of the window until the market falls and everyone looks for the exit door. If Barakah can redeem at 0.20 at every coupon payment date, then the listed price is ridiculous and retailers will get hurt badly. Free market at work or irrational exuberance? Bursa should have alerts regarding this.