Ooi puts in RM52m (RI), Brahmal RM42m(PP), Fund Management RM42 (PP), CapitalAsia RM34m (JV Partner), Syndicate Bankers RM164m (lenders), all money came in since Dec2015. Any investments need time to bear fruit. Unless the Brahmal factor comes in faster than expected, just hold on.

WB also said "The stock market is a device for transferring money from the impatient to the patient."

That is for NYSE stocks.

For KLSE, we need to take it with a pinch of salt. There are some that fits that principle (IJM Corp, Nestle, Kossan, QL, DLady, Gamuda, Dialog etc) and there are also those may not (UMW, MAS, Proton, Perwaja, MAA, Cymao, Mudajaya).

We actually need: (1) outstanding biz (2) outstanding management (team) and (3) patience

Tan Sri Kok Onn sold about 5,500,000 shares at about RM2.90. If he sold today, he could have made another RM1.155m.

If we have the patience, why not give it a 10 year try.

Gadang is moving in the right direction what IJM Corp or Gamuda did 20 years ago. Of course, don't hold it for even a second if we think it is grossly overvalued and the biz or the management is not outstanding.

Sometime the margin of safety grows over time as the Group improved its sustainable earnings, moving into outstanding businesses (like utility) and strengthen its financials (taking bigger jobs), while reducing the core biz (dependent on contract secured yearly - nothing wrong with that, but it need buffer from recurring income).

Gadang has the privy to benchmark against the successful giants. So, it is not entirely baseless to hold it for long term, as it is only RM800m as against IJM Corp and Gamuda, which is about RM12 billion today.

Isn't it an opportunity to add at 80sen?

Warren Buffett said, "time is the friend of the wonderful company, the enemy of the mediocre".

He also said,

If we believe the management is not outstanding or the business is not outstanding, don't even waste time to own the biz for a minute. If you are not willing to hold a stock for ten years, don't even think about holding it for ten minutes.

Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years.

These are tested principles (in USA), applied it wisely (in the local market). Don't forget about common sense as well.

zoomboom bro, I cannot tell what will happen in 20 years, similarly, when someone bought IJM Corp when it was about RM100m, they did not know if they hold it for 30 years, it become RM12 billion. But based on DCF (UOB) as reference, RM1.30 based on sunny-day valuation (tenancy 1.15). I believe Myanmar should enjoy higher, say, tenancy 1.5 times, although management said 1.8 is their target. So, I leave it to you to do the maths. That is for next few years. (I don't believe many have read my article lately and actually done their own DCF based on tenancy of 1.5, else, then they will see the real potential)

However, if over the next few years, they acquire more towers, or buy back from PE or JV partners, then, we have to reevaluate or they may even consider IPO its towers. So, the value will continue to improve. I think they will rest for a short (at least until end of Dec/1Q17, after acquiring USD70m + USD50m). They may be busy again, if Telenor ask them to build the balance 2,000 towers. Or they may, acquire more towers in Vietnam, to consolidate the independent tower operators to make them more efficient when combined. We will have to look at the management views and actions over the next couple of years.

23 August (22 sen) to 18 Oct (25 sen). For trader is not bad. For investor, a bit too low for me. Depends on your time frame of investment. I remember one writer said, once you jump in and out of a good "compound interest" bus, you may not gain as much as you suppose to.

For trader is different, they go in a few loads warrants, and they get out in a few loads as well. Different strategy as compared with investors.

@buddyinvest (referred from OCK)
1) Ho Hup provide land (for Pavillion Bukit Jalil), get 18% of GDV
2) Gadang provide land in Johor Tampoi (For a Singapore developer, Hatten Group), get 16.7% of GDV and Gadang don't take the risk of developer.
3) Kwasa Land provide land in Sungai Buloh, get RM165m.

Both Gadang and Ho Hup is for high rise and high density psf. Kwasa Land is landed property, share of GDV for Kwasa Land is likely higher % than Gadang and HoHup.

Gadang is at the moment at Level 2 contractor (based on Kwasa Land criteria), there is a chance in future they become Level 1 contractor when the Shareholders' Fund grow to RM1.0 billion.

However, I think it is conservative to say that the GDV of Kwasa Land (Block 3-1) is more than RM500 million and also depend what risk that Gadang take.

If we take into account (1) existing book order + unbilled sales AND
(2) multiple proposals (3) Kwasa Land and (4) MRT2 (likely), Gadang upside is GREAT (whether "someone" promote it or not. (>30% upside)

imho.

Will discuss in Gadang. Not fair for OCK shareholders. I mentioned Gadang just to share that don't follow prominent shareholders blindly. That's the message. Do your own due diligence.

Of course, I do not encourage others to follow blindly just because Brahmal has invested RM26m in this stock. However, you can rest assure his team has done due diligence on this company. So should you, if you are interested. He may add another RM30m.

The fact the share price has been consolidating between 70 sen to high of 85 sen over the last 24 months, really gave opportunity for those who have not get into the train yet, to jump in. Once the train starts moving, it is difficult to jump in.

Look at the issues objectively. Don't be sway by prominent shareholders. Similarly in another stock, Gadang, Fong Siling and KYY (more recent) have invested in this company. The fact that they have done a multiple proposal and kwasa land deal, and anticipated MRT2, it is worth a while to review it again. The fact the PE is only around 8X, and chances are good that earnings will grow 10-20% over next 5 years, provide a solid margin of safety. After all, the analysts expect the company to replenish about RM500m book order every year. Isn't Kwasa Land worth more than RM500m?

IJM Corp was once upon a time traded at RM66m. Today, after 30 years it is RM11.7 billion. So, sometime we may have different horizon of investment, so expectation will be different. The question we should consider:

Are we buying a wonderful biz at a fair price, or we rather to buy a fair biz at a wonderful price. The former has been proven to provide above average gain.

At 2.85, with Kwasa Land deal + MRT2 (anticipated only), the value of Gadang should be able to join the billion dollar company soon. One of Fong Siling's top picks. Before Kwasa and MRT2, Gadang has GDV of > RM5 b (232m unbilled) and order book of RM650m.

For those who is hurry to make profit (3-6 months), he or she will likely be disappointed with OCK. The earnings of Myanmar and Vietnam deals is only coming in 2Q17. We can only take a glimpse in Aug 17. Be patient. The returns is worth the wait. UOB said in a sunny day, it is value about RM1.30. I think it should be better than that as the tenancy growth will surprise most.

For every 10% who know, 90% who either don't know or don't care. This is a stock market, there is always 90% who don't care or don't know. Otherwise, there will be less opportunity.

Liquidity is also a culprit. Let just said, they give very low borrowing cost for share margin, don't you think the market will go higher?

More than 20 years back, people buy property for their own stay. 5 years ago, due to "easy money", more people we talk to seems to "invest in property", i.e. for capital gain or rental yield.

stocktrader 3, thanks

finally, out of a thousand comments, one that provides some value.

In a statement issued today (13 Oct 2016), Kwasa Land said that Gadang’s bid would give a total financial return of RM165 million for both the land cost and profit sharing to Kwasa Land.

How much will Gadang get?

Disregard who picks up the PP, is it not good for OCK to do a PP at PE of >20x and participating with the PP cash with a sustainable return and a payback period of about 6-8 yrs.

In theory, PP is just a partial IPO. If we take the emotion out of the equation, the good or bad of PP depends on two things: (1) at what PE is the PP is issued (2) what is the ROE of this PP. The rest is up to investors perception. If I issue a PP at PE of 32x, and invest the PP into a project that has a payback time of say 4x, you think the PP is good or bad of the company, at least in theory? I hope that explain the theory/technical side.

Different situations and different partners.

Its a fair price for a wonderful business, provided you have the patience. I have accumulated a bit lately.

OCK has met Creador's criterion and so far invested about RM26 million for 3% (about 80sen per share). Do not follow blindly, does OCK met your own criterion? It might not, if you use conventional measurement of ROE, PE, NTA or DY. This is because, the conventional measurements are used on the past record, not the FUTURE deals.

OCK has raised up to RM700m last 24 months, from shareholders, placees, bankers, private equity, JV partners, and other stakeholders. And the return in this investments will take time to realise, starting mainly from FY2017. A more appropriate estimates is to use DCF method, as they have a concessionaire of more than 10 years. So, you can make reference to analyst report as to how much can these deals generate for OCK.

Don't follow blindly. Do your own diligence, as I always said, investment decision should always be INDEPENDENT. Warren Buffett did say "Diversification is protection against ignorance"

"Diversification is protection against ignorance. It make little sense if you know what you are doing" Warren Buffett said

Well, I do advocate diversify our currency into USD, or Sterling (flash crash last Friday to 5.14, if your kids studying in UK). It's nothing to do with diversification in stocks.

Someone did ask me about speculating in this stock. My answer, are you serious?

Similarly, Gamuda grow from RM5.6b to RM11.74b from 2006 to 2016 today. Gamuda ROE is about 9-12%, while IJM is about 6-9%. Gamuda also has Construction (include Engineering), Property and Infrastructure Concessionaire.

If you put them side by side, IJM, Gamuda and Gadang, they all move into Infrastructure/Concessionaraire and Plantation while keeping their core with Construction/Engineering and Property. Gamuda Infrastructure Concessionares is contributing 44% in term of PBT.

So, lets us have a healthy body and a strong mind to keep Gadang for say another 10-20 years, if they can grow into the size of Gamuda or IJM Corp. Of course, the growth will slowed once they reach about RM4-5 billion. Your grandkids will thank you for that.

Look at IJM Corp Annual Report 2015, 1986 to 2016, its market cap grow from RM66m to RM12.5 billion in 30 years.

However, if you look at IJM Corp fro 2006 to 2016, it grows from about RM9.3 billion to RM12.5 billion (disregard one off dip in 2009 to RM2.7b, those who bought it at 2009 will be laughing to the bank now)

If your dad just buy RM10,000 of IJM shares for you 30 years ago, today you will get RM1.9 million. So, perhaps, you want to give Gadang to your grandson? Not a bad idea.

IJM Corp today has Property, Construction, Infrastructure, Industry and Plantation. Looks similar to Gadang. So after all, seems easy to be a millionaire right. I don't believe they give much dividend. Based on last 5 years DY is about 2% p.a.

If the company do not have effective usage for expansion that gave a ROE of say >10%, for a period of time, it is wise to return the money to its shareholders.

However, if a company trying to grow the company to a higher level, say, from an average RM80m p.a. profit last 3 years to RM120m p.a. average over the next 3 years, and gave an ROE of 12%, I rather the company not pay a single sen of dividend.

Furthermore, Gadang is expanding into capital intensive project, plantation (was told no gearing), water concessionaires (already pay down most of it), hydro power plan, on going, need cash injection before inflow comes in.

So, the company need to grow from class B to class A contractor, it needs to build up its shareholders funds. Some tenders, depend on size, need a minimum amount of SF. So, overtime, you have to build it up.

As long as the cash are used wisely, giving an ROE of double digit, I think, it is better, because, this will ultimately turn into capital gain.

For dividend yield stocks, normally we go for consumer, or certain telco that can give consistent cash flow. Normally construction and property company don't give very high dividend yield, especially if they are growing their assets. Gadang is gradually putting more money into stable and sustainable earnings biz like water concessionaires, plantation, and power plant.

Look at IJM Corp, market cap it RM12 billion, and Gadang is only RM750m, Gadang has much much more to grow. Isn't it?

Capital City 21 - Was informed that there are about RM140-150m not recognised yet.
They also have, Cyberjaya/Semenyih.

Construction order book RM656m, excluding Kwasa Land, estimated RM500-550m.

Plantation, about 5,200 ha, mature in 2-3 years time, market benchmark EV is RM40,000 per ha for small plantation, big plantation company enjoy RM60,000 - RM100,000 per ha. After all, Gadang has 90 years lease.

There are people who are willing to pay RM250m to RM300m for a mature plantation in Sabah with good yield and OER.

Of course, more projects, is in the pipeline, MRT2 etc.

Mini-Hydro in FY19.

Water concession, expanding from 3 to 4 concessionaires. No debt on water concessionaires. Provide stable and reasonable cash flow.

If we have time to research and add it up, you will see the value is higher than the price, and it takes a few years to materialise.

Let the management worry about the steel price. Most businesses are subjected to the price volatility or shortages of raw materials, labour and authorities red tapes.

This may be good opportunity to pick up OCK or the warrants at price similar to this PE before the share price move closer to the intrinsic value. Of course, do your due diligence first.

Let us not focus on just the black dot on a whole white piece of paper. The black dot, may, help you save millions in the future is we take it as a lesson learned.

Btw, do your own research, this is just an example how Creado does it. If really unsure, buy 100 units, in order to the learn the lesson, it is definitely value for money. Even the lemons, you can buy 100 unit, see if you can learn something.

Good news if it is true. Smart fella. Of course, the warrants is better.

Any idea why past 3-4 years ago, Taiwanese (manufacturing) trading at low PE of 3-4x, and now closer to 7-10x? Any "story' about Taiwanese companies listed on Bursa?

Thanks for the info repusez. Most funds started in 2009 shows good results because a rising tide lift all boats, provided you are in the boat. Isn't it?

Eastspring
Between July and Aug, Eastspring sold down their holding in ULICORP from 7.34% (RM26m) to 4.14%, the share price dropped from RM6.50 per share to RM4.00 per share. This is the "risk" of small cap stocks. When they reduce their holdings, the price will drop significantly.

That is what we called

"A RISING TIDE LIFTS ALL BOATS"

That is why, the market gave a lower PE for small cap stocks. Am still researching how many and how much small cap funds raised over the last 5 years. I have a feeling it doubled. Lets not speculate, will find out the fact later.

Similarly like Kenanga Small Cap Fund

Eastspring Small Cap
2001 to 2009 - <50%
2009 to 2016 - 758% (CAGR = about 28%)
For Eastspring to perform CAGR next 7 years for 28% is very very difficult (probability <50%) Am sure the Fund Manager won many awards, if he or she joined 7 years ago.

Kenanga Growth Fund
Inception 17 Jan 2000 (16 yrs 9 mths)
Size: RM726m (22% Cash)
Top 5: Tenaga, LBS, Pestech, Press Metal, Inari

Performance
2000 to 2009 - 0%
2009 to 2016 - 325% (CAGR = 18%)
Since inception = CAGR = 7.5%p.a.

Perhaps, a new good fund manager just joined in 2009/10. So, it is not as easy choosing a winning unit trust. In fact, if you ask me, it is easier to select a winning stock than a winning unit trust.

Kenanga Growth Funds is an inverse of iCapbiz (first 5 years doing very well, second 5 years 0% return).

Top Small Cap Fund (As at 31 August 2016) - can be used as benchmark
Eastspring - 1 yr = 18%, 3 yrs = 73%, 5 yrs = 180%, (since inception 758% from 29 May 2001)
CAGR since inception = about 14% p.a. (15 years)

Top 5 holdings (4-5% each) = Kerjaya Prospek, Inari, United U-Li, Berjaya Auto, Oldtown (Total 20% of fund size of RM353m)

In Focus Malaysia, for 10 years funds' performance, iCapbiz, is No. 35 (CAGR about 11%), top 5 is 16% to 22%. Of course, most of the open ended funds don't keep 65% cash, if they do that, unit holders will sell it.

Normally I review the business 3-5 years ahead, and some of the negative I see in retail/Padini:

1. Padini has included 2 Hari Raya Festival Sales in its latest FY, may be hard to repeat the record sale and profit;

2. GDP slowdown from 5% to 4%p.a., more are tightening their belts

3. Household loans is 89%, substantially in properties, tie up cash, need to service loan and interest, and rental dropped significantly. Hence, reduce purchasing power of many.

4. Use to enjoy 6-7% when price is about RM1.50. At current price, not sure can enjoy such high dividend for long term. Many bought Padini for high DY.

5. Glut in retail properties.

From another perspective:
1. Padini latest FY included 2 Hari Raya Festival Sales
2. More are tightening their belts, no thanks to RM depreciation
3. Not sure dividend can maintain at at least 5% (when price is doubled from 1.50 to 3.00) which some may have bought this shares on the high DY basis.

1. Property GDV is RM5.4b. Assumed 15 years and 22% Margin, long term contribution is RM80m p.a.

2. Power Plant will be in by FY2019.

3. Water concession gave steady cash flow.

4. Property focus on PRIMA, Selangor Rumahku, and landed, Laman View, Semenyir, Cap21.

5. Kwasa Land - awaiting detail.

6. FY2015 EPS per share is 40.9sen. without growth x PE of 8.5x = RM3.50.

7. Don't buy for short term, it takes 4-5 years for property to breakeven. Any other business, takes longer. Look at the shareholders' funds growth over last 5 years, you will be impress.

USD, Euro, Sterling, Yen. Which one do we choose, between now and next 1-3 years? And why?

(BI, Bloomberg interviewer, GS Gary Shilling)

BI: General View on Economy
GS: Slow Growth going forward (Globalisation is working off the excesses), winter of discontent. People will push of fiscal stimulus when monetary policy is not effective.
BI: Is big fiscal stimulus coming?
GS: Infra or Military? We don't know until the new president is elected.
BI: Changes in market this day, liquidity is down, how much concern you?
GS: It does effect the price of assets. And spill over the economy (no longer that much). Expansion since 2009, we have 2 worlds, one the financial world (effected by central banks) and the Goods and Services (going through the age of deleveraging), there is a major DIVERGENCE. Purchasing power drop, and they don't own much stocks (not much effect to them).
BI: Into Cash GS?
GS: 50% into Cash. If stagnant, we need a big pile of cash. US is looking at BOJ and EU to experiment with ZIRP, US is unlikely going into them.
BI: Is economy a physic? Formula still working?
GS: It doesn't work temporary. Speed up by tech. Manufacturing from EU & USA to China and EM, cause polarisation.
BI: Employment issue, any solution.
GS: Is a transition period. Not much policy can do much. example, auto, over paid sector.
BI: Gold
GS: I never understand Gold. I am neutral. Deflation - Age of Deleveraging. 1998 wrote a book and 2010 another.
BI: How to explain to your kid on Deflation?

@imoogi99, you are right, my bad. I started "playing" with the market during early nineties. Perhaps Aokam and Repco overshadowed Hwa Tai. Today most shares are issued at 10sen par, we will not have many 100 share other than Nestle and few others. We also have the billionaire to millionaire KNM story. Bursa is a 20:80 game. If each one we write an open letter like iCap, we will be quite busy.

@kllady - for me it sounds more like awful recap, there are more, KNM, Benalec, Brahim etc
@PlsGiveBonus - if Super investor can do it for another 5, or say 10 years, he will have RM10b and RM1.0 trillion by 2026, he or she will be first trillionaire, first in Malaysia and world, congratulation
@MuttonCurry - Yes, for those who don't have driving licence, please, please, don't compete in F1, congratulations
@imoogi99 - come on, not many Bursa stocks exceed RM100 per share, who is Hwa Tai owner? He should have won the best CEO award for shareholders' value, how come I never heard of it?
@Hiu - everthing in life is risk. If we follow Pareto law, the winning probability in unit trust, perhaps is 20:80, when I thought casino gave a 50:50 chance, and why people invest in shares?
@madguy - I hope you are not as what your name suggest, have a good day, cheers, don't worry about Hwa Tai, we won't find one for a long time

Added a bit at RM0.795 based on new number of shares after PP, 871m shares.

Awaiting execution of Myanmar and Vietnam deal, total EV of USD120m (RM280m), with EBITDA of 8X = USD15m or RM60m.

Tower biz EV/EBITDA should be around 12X (Indonesia is >16x)

@Flinstones, I have compared BU2/7, the CAGR is about 8% p.a. (28 years, bought in 1988), and Nestle Malaysia (I only have 10 years from Bloomberg, bought in 2006) CAGR is about 17%. Perhaps the first 10 years in BU, the CAGR is 10% or more. But there are many, during the 2010 to 2013 craze, many landed properties double in 3 years (i.e. CAGR 24%) but over a longer period, say 10-20 years, it will fall to 7-8% p.a. So, it depends when you buy or sell, similarly like stocks. Some i3 sifu said they made 400%-500% in 18 months. So, very hard to compare. As long as you have double digits for >10 years, you are doing great.

From the perspective of foreign investors, our market already CRASHED, why? In USD term, we have loss about 30%.

If you notice, Japan Nikkei, when the Yen strengthen from USD1 to Yen124 to Yen 101, the Nikkei dropped from around 20,000 to 16,000.

Similarly, when you compared London stocks prior to Brexit, when sterling loss about 13% against USD, their stocks went up about 10%.

Mr Tong (The Edge), was only 32% invested. Why he think that?

Mr Tan Teng Boo, was also about 40% invested (if I am correct). Why he think that?

Like properties, one have to be very specific. Sometimes, when the stock market crashes, say 20% in 6 months, your stocks may be up 2%. So, the crash are meaningless to you. Of course, if we think the crash is temporary, then we take opportunity and buy the index, we may get a 30% return in say 2 years, if it recover.

However, I am very convinced that the real economy growth for the Top 5 economies going through slow growth (at least for one to two more years). And in USA, the financial markets (Stocks and Bonds) and its real economy is in diversion since 2008. The diversion (similar to risk), gap is getting bigger by the months. Hence, there is a higher chance of the financial markets will reconcile with the real economy by some significant adjustments to the financial markets.

So, crash in stocks means differently to different people. Depends on their exposure, asset allocations, net worth vs invested capital, holding power. For some who hardly invested, a stock market crash means nothing to them. But for someone who borrowed a lot and invested a lot, when he doesn't has holding power, he is likely to sell when stock market crash.

Similarly, those who "investors" who bought say 2-3 condos, thinking that they can flip or get 6% rental yield, are in for a shock when they receive their keys. You are lucky if you can rent out. Say you can only rent out at RM2,000, when you expect your rental to be RM3,000 to cover your instalment payment. So you are RM1,000 out flow per month. Any during this period, if you sell, unlikely you can get higher than the last price you paid for (for condos) which launched at RM800 to RM1,000 psf.

For those who cannot get it rented out (usually for integrated development with hotel, shopping complex, offices and condos which launched phase by phase in 3-5 years - due to noise, and continuing construction) for say one or two years after receiving VP, this person is pay say RM3,000 per month for two years without rental, you will have a RM72,000 out flow. So, the question is, do you have the holding power? What if you just have 2 similar type of condos, unable to rent out. That will be around RM144,000 for 2 years. PANIC? So, this "investor" is in serious crash even the market is stagnant. What if he worked in a bank or oil and gas industry, and ask to leave, they without sufficient saving, what should he do?

Crash is relative!!! A guy who kept all its net worth in Ringgit, already crashed about 30%. The last round, it takes about RM3 plus to Yen 1000, today , it is about RM4 per Yen 1,000.

Look out for RM82m-RM14 = RM68m under current assets.

swap a bit of Gadang RM2.84 to OCK-W 22 sen.

Swap a bit of Gadang (2.84) for OCK W (22 sen), for a period of 1-2 years.

Accumulate when no one is interested. Today's volume is only 570,000 vs 5 & 8 of August, the volume were around 25,000,000.

Hi Zai Zai, thanks for the information (that is not shown in any report). Lets hope more will appreciate this stock later.