Still a lot of upside to go

Hold on to ur horses. Yeeeeha!

mr00183, by the time when u are able to verify what they have done later, the stock will have appreciated to another value levels. The company "invested" RM 10.5 millions is not a small sum and that is for phase 1 only. With determination and financial commitments like that, rest assured it will propel Hevea's earnings higher than the average norms. I've never "heard" or "seen" any mushroom cultivation projects that failed before be it small, medium or large scales. I'm trying to be realistic most of the time as well but I'm seeing the rewards weighing higher than the imminent risks so I'm giving a full force to go ahead.

I've posted the entire interview article from FocusM earlier above. It's better to read well in order to understand the project further but I've already knew Hevea's new mushroom venture is a "large scale" one based on the invested amount because I was involved in other greenhouse projects before. Also the reason it's expensive because it's a "climate-controlled fungi cultivation facility". You see that, MD Yoong had mentioned the new mushroom venture is divided into 3 phases and so far this year, the company had "invested" RM 10.5 millions in stage 1 only. Read the following statements from his own words as well:

“The project is divided into three phases. At the moment, we are only in the first phase. If things are encouraging and we see growth prospects, we are able to triple capacity. The business plan [of mushroom cultivation] seems to point towards this direction and maybe something quite encouraging."

nikicheong, the management and directors mentioned the profit margin is over 40% for its new mushroom venture during recent AGM in Seremban. Another puzzle pieces of information u can read from MD Yoong Hau Chun's own words in recent interview article in FocusMalaysia newspaper too:

“The return on investment is rather short [in terms of pay-back period] and the margin is impressive on paper. This is why we decided to go into it,” Yoong tells FocusM.

"...group managing director Yoong Hau Chun says profit margins from the mushroom cultivation will be better than its core business of manufacturing particleboards and ready-to-assemble (RTA) products."

Read the second statement above from FocusM. Just as we all know Hevea's profit margins for particleboards and RTA ranging 16-20% averagely so it tells u already in the man's own words that the new mushroom venture is exceeding 20% for sure.

It's totally no problem at all. It's just Hevea's mushroom business commands over 40% profit margin while particleboard & RTA both command stable 16-20% profit margins. These are very healthy & good profit margins that not many companies are able to achieve & maintain but it's not for everyone.

Maybe Fabien is an excellent CEO candidate than Hevea's CEO who actually brought superb returns to Hevea shareholders & succeeded the turnaround business plans implemented back in few years ago despite many baseless accusations. So again time has truly shown us who is really able to do it successfully.

Also maybe Fabien can show us some real verifiable proof if he has some real world economic/business senses. Hevea's new mushroom venture with over 40% profit margin is too little small for him.

The return of the King! King Oyster Mushroom that is!
https://forestfungi.com.au/blogs/forest-fungi/91372614-return-of-the-king-growing-king-oyster-mushrooms-at-home

Demand picking up!

King Oyster Mushroom
https://en.wikipedia.org/wiki/Pleurotus_eryngii

Better don't argue with stockraider about mushroom since he has mushroom phobia lol

I post the entire article from FocusMalaysia newspaper here at above divided in 2 parts so u don't have to download the document. Hope that makes it easier for others to read it.

Btw, it's on the Weekly Issue 240, July 8-14, 2017.

He says in the event HeveaBoard expands its production capacity, it will be in a difficult position due to the limited raw material supply.

“If you analyse the first quarter results of most of our peers, they will talk about the shortage of rubberwood, and that they have actually reduced production,” Yoong says.


Rawmaterial shortages

To address the possibility of raw material shortages, Yoong says the company recently invested RM4 mil in cleaning equipment to expand its raw materials and product ranges by using lower quality materials.

HeveaBoard is believed to be the first in Malaysia to invest in such cleaning equipment.

“We think the best way is still to make sure we have enough raw materials, just like how we invested in cleaning equipment.This will further improve profitability as well.

“If you put up another production line, the question is where the raw materials are going to come from?“

This is why we want to fur-ther improve and upgrade the line for quality and differentiate ourselves so that our selling point can be even higher.

“We grow our top and bottom-line from this aspect rather than volume,” Yoong says.

For FY17, HeveaBoard allocated RM48 mil for capital expenditure, of which RM10.5mil is allocated for the mushroom cultivation business, RM4 mil for particleboard upgrading works, and RM20 mil to construct and acquire RTA equipment.

On Jan 11, HeveaBoard announced the acquisition of 3.12 ha in Negeri Sembilan for RM13.46 mil to house its new RTA plant.

Yoong says the expansion of the RTA division is mainly to cater to the Japanese market.

While some shareholders say HeveaBoard’s expansion is prudent, Yoong believes the capex allocated this year shows it is aggressive in expanding, especially with the construction of its new RTA factory.

HeveaBoard enters into mushroom venture

• The company says the new business has better earnings margins compared to making particleboards and ready-to-assemble products

• It wants to grow top and bottom-line rather than volume

• Limited raw material supply is hampering any expansion in production


PARTICLEBOARD manufacturer, HeveaBoardBhd’s move to cultivate gourmet fungi (King Oyster mushroom) has raised investors’ eyebrows as it is venturing into an “unrelated” business.

However, group managing director Yoong Hau Chun says profit margins from the mushroom cultivation will be better than its core business of manufacturing particleboards and ready-to-assemble (RTA) products.

“This [earnings margin] is what prompted us to look into the new business.

“The project is divided into three phases. At the moment,we are only in the first phase. If things are encouraging and we see growth prospects, we are able to triple capacity.

“The business plan [of mush-room cultivation] seems to point towards this direction and maybe something quite encouraging.

“The return on investmentis rather short [in terms of pay-back period] and the margin is impressive on paper. This is why we decided to go into it,” Yoong tells FocusM.

To date, the Japanese Industrial Standards certified particleboard manufacturer has invested about RM10.5 milion equipment to cultivate the mushroom.

Yoong says the new venture relates to HeveaBoard’s core business to a certain extent.

He says HeveaBoard produces up to 100 tonnes per day of low-quality raw materials, which are organic compounds that are usually sold to boiler users at a discount.

“We have been thinking what to do with this low-quality raw material. Actually, there are a few uses for it, one of which is to cultivate the mushroom,” Yoong says.

Despite not having prior experience and knowledge in mushroom cultivation, he saysHeveaBoard has done research on it and found that no one in the country is growing the King Oyster mushroom.

“We thought it will be good because there is a market here, and we can utilise our waste product.

“Most importantly, we have a group of people that are already in mushroom cultivation activities, although it’s not the same fungi.

“Still, the technique is more or less the same, and we have purchased the knowledge transfer from China.

“In fact, our people have gone to China for the relevant training. I think it should be fine, it is something we should be able to master,” Yoong says.


Higher margin products

As it is, the company has been moving towards producing higher margin products. For example, it ceased production of its E2 grade particleboard, which was its bread and butter product, to focus on higher grade ones such as E1, E0 and super E0 grade particleboards.

Particleboard is classified into various grades, with the lowest being E3, and the highest super E0.

A lower grade particleboard producers higher formaldehyde levels, has weaker physical strength and offers lower profit margins.

The E0 and super E0 grade particleboard make up the bulk of HeveaBoard’s total production of 400,000 cubic meters a year while E1 grade accounts for about 15%.

HeveaBoard’s E0 grade particleboard is exported mainly to China, and the super E0 grade to Japan.

According to reports, HeveaBoard’s exports to China account for 43.85%, Japan (12.28%), South Korea (11.74%) and India (10.56%), while local sales accounted for 13.36% of the total.

For its RTA products, the main importers are Japan (62.46%), Europe (11.45%), Australia (11.86%) and the US (2.69%).

For Q1 FY17 ended March 31, HeveaBoard’s net profit increased 24.87% to RM25.31 mil from RM20.26 mil a year earlier, on the back of improved revenue of RM158.65 mil from RM145.91 mil previously.

Its particleboard segment reported a pre-tax profit margin of 20.11%, while the RTA segment recorded 17.75%.

Yoong attributes the better Q1 result to the higher average selling price of its products.

He says towards the end of last year, demand, especially from China, increased, enabling it to raise its selling price progressively.

Despite the improved Q1 profits, Yoong says HeveaBoard’s results were slightly dampened by the increase in raw material costs.

He says the price of rubberwood, for instance, increased due to the wet weather and higher latex prices. This led to a lower supply. Moving forward, Yoong expects the price of rubberwood to stabilise.

“I think it will not actually go up any further as the price is already high. We have to see if there is any room for future reduction. But at the moment, the raw material price is still high,” he says.

HeveaBoard, he says, has no intention to increase its current capacity. “We are not expanding capacity in the existing business because we have decided to upgrade and work towards the elevation of quality rather than volume.”

Nvm lah, he's just jealous after reading this statement by MD Yoong Hau Chun himself:

"Group managing director Yoong Hau Chun says profit margins from the mushroom cultivation will be better than its core business of manufacturing particleboards and ready-to-assemble (RTA) products. This [earnings margin] is what prompted us to look into the new business."

It's an excerpt from the latest interview in FocusM

mr00183, he just failed in his evergrn u go there u can see his funny acts lol

Stockraider, your childish actions are showing your weak personality. Don't be so jealous with HeveaBoard. Buy Hevea shares lah! (LoL! someone secretly buying also) Time and tide wait for no man. Our growth prospects are very bright with solid earnings growth. If u buy Hevea shares, you'll receive dividends every quarter since our balance sheet is very healthy and solid.

Hehehe we can see how this fellow stockraider has become so weak and he has become a nuisance. Let him bark is good also because he can help us promote HeveaBoard! People know how to differentiate between his Bullshi+ and our promising growth story! Hahahaha!

Nvm lah, he's just jealous after reading this statement by MD Yoong Hau Chun himself:

"Group managing director Yoong Hau Chun says profit margins from the mushroom cultivation will be better than its core business of manufacturing particleboards and ready-to-assemble (RTA) products. This [earnings margin] is what prompted us to look into the new business."

It's an excerpt from the latest interview in FocusM, u can download it here:

http://s000.tinyupload.com/download.php?file_id=03957857642808863309&t=0395785764280886330960589

http://www.heveaboard.com.my/en/awards-certifications

His version of the make-up story is very weak and not convincing. Basically, he just keep mumbling about food safety but he's actually making a fool out of himself because his reputation is tainted.

He has not answer my questions below:

1) Is palm oil toxic? Those sold in supermarkets and worldwide? Everyone knows that artificially-produced chemical pesticides, herbicides, hormones and fertilizers are used and applied in cultivating oil palms. The vegetables u are eating everyday how?

2) If those foods with "Organic Certifications" is not safe then what about those foods without food safety certifications? What about those vegetables or imported mushrooms sold in wet markets? Didn't we buy from supermarkets and wet markets from almost all same sources of distributors? Human race will extinct soon?

Without knowing it, stockraider is eating foods (vegetables) easily tainted with pesticides, herbicides and other chemical hazardous agents. These hazardoous agents seeped right through inside the crops and plants which ended up on his everyday meals. His mommy cooked such foods for him and his entire family. So how? If u can afford, you rather eat certified organic foods or non-certified/non-organic foods?

So the certifications in the entire world are not safe? Yet he's still eating foods from wet markets without food safety certifications lol.

If those foods with "Organic Certifications" is not safe then what about those foods without food safety certifications? What about those vegetables or imported mushrooms sold in wet markets? Didn't we buy from supermarkets and wet markets from almost all same sources of distributors? Human race will extinct soon?

Stockraider, you haven't answer me lah.

Does palm oil toxic? Those sold in supermarkets and worldwide? Since artificially produced chemical pesticides, herbicides, hormones and fertilizers are used in cultivating oil palms. The vegetables u are eating everyday how?

Don't jealous lah. Hevea doing very well and u make troubles.

"Heveaboard produces up to 100 tonnes per day of low-quality raw materials, which are organic compounds that are usually sold to boiler users at a discount."

ORGANIC COMPOUNDS written in the statement. Are u blind? Do u know what is ORGANIC?

Can u tell the whole wide world now? Does palm oil toxic? Since artificially produced chemical pesticides, herbicides, hormones and fertilizers are used in cultivating oil palms. The vegetables u are eating everyday how?

Hevea's mushrooms will undergo testing and organic certifications. You dislike mushroom? Did Luigi or Mario eaten your mushroom during your childhood? lol

I understand u lost tons of money in evergrn and this is widely known lol

I thought u are busy saving your evergrn? What happened there? Looks like diarrhea situation there now

Why u make me laugh so hard today? U said this:

"Eo zero is for non food certification....not for makan loh...!!"

That JIS certification is for particleboards not for foods. For mushroom, there are other certifications. Don't embarrass yourself more lah hahahahhaaha

This funny dude so jealous on Hevea. Buying up the shares.......

Since when Hevea produces "fibreboard"? lol cuckoo. Let's see what else funny thing u wanna say. I'm waiting for some amusing jokes.

The driver is very important. If u give a ferrari vehicle to an amateur driver like stockraider and a normal car to michael schumacher, the chances of winning lies in the highly skilled driver mah.

U see how Vin Diesel drove a troubled old car in the opening of the movie "The Fate of The Furious (2017)" and the same goes with it lol

Thank you stockraider for making noises. I bought more today.

Long ago, I've predicted that it is not a good move to expand production capacity because of that "limited" raw material supply. The best strategy is to manufacture premium products with the existing capacity. The CEO has the same thinking as me so that was when I knew he's the right candidate to execute the turnaround story so I've invested heavily into Heveaboard. The e0 and super-e0 are the highest grades of particleboards and KreaKids furniture products are all also considered to be of highest grades in terms of health safety and environmentally responsible thus it can be exported into those first-world countries with very stringent standards and requirements without much problems.

If u ever want to uncover the next big gem stocks, I would suggest u to check and examine who actually runs the company with all the crucial decisions making on hand. Don't just focus on a company's financials alone. It's almost useless if u are given a powerful vehicle but the driver lacks of hindsight and the skills to maneuver it.

free2invest, Hevea's quarterly results are normally solid, sustainable and keep on improving so I have no worry at all on that subject. I've mentioned sustainable because u can know how MD and his team are very proactive until the inception of the turnaround business plans initiated since years ago have resulted in Heveaboard to emerge as the leader in the industry. This is seen evidently not only in volumes of shipments but the most importantly its brands recognition.

I just focus on what Hevea is doing and where Hevea is selling to and importantly how it executes the penned out business plan for the entire fiscal year. After all, the sales, revenues & profits are the most important so what kind of products the company is producing and its target customers will determine its bottom-line. So far, I've seen it evidently that Hevea's management team is always dead serious if they want to make something to work out. Just look at how its particleboard and RTA divisions is enough to cement one's confidence with this solid company.

For a management team that has brought a remarkable successful turnaround business plan and strategies, this is undoubtedly one of the best among its peers. I've compared Hevea to the rest of its peers but still I picked Hevea because of its solid balance sheet and bright earning prospects moving ahead. Did HLIB picked up some of my lines from the past? lol

Keep watching closely on how fast the management team can make the gourmet fungi business to be up and running. I expect it to fruitful by the mid of next year or possibly earlier because the life-cycle of mushroom cultivation per batch is 6 months from start to harvest.

The article in FocusM almost explained everything from the new venture to other technical details and expansion plans. Just remember that if a company spent on CAPEX, it should be fruitful in the shortest time possible. If more than 2 years also not fruitful, u can expect the stock price to drop just like some other useless stocks. Heveaboard's track resulting records speak louder than words. Just read the very latest interview article in FocusM, u can download it here:

http://s000.tinyupload.com/download.php?file_id=03957857642808863309&t=0395785764280886330960589

I have the hard copy but our fellow contributor simonc shared it this morning so I just re-posted it. Courtesy thanks to simonc.

I also never learn that from 1.30 to 1.45/1.53 is considered a price crash? Thank you for lesson lol

Thank you for jokes of the day! We receive dividends automatically every 3 months so we sleep very well at night because we don't hold onto those other useless stocks lol

So strong sour smell. Someone drank a bottle of vinegar!

Free for you to download the interview in FocusM

http://s000.tinyupload.com/download.php?file_id=03957857642808863309&t=0395785764280886330960589

I give a thumbs up for Sami_Value! Yum yum..... stockraider hated mushroom. He prefers processed unhealthy foods better for him lol

Maybe it's time to flag some idiots or moon goers too

Because I don't fly to the moon. I take actions and proactive that is how I grow stronger.

Stockraider, don't be jealous lah. Heveaboard doing very well and rewarding us shareholders mah. Why u drink vinegar? lol

Nvm lah, he's just jealous after reading this statement by MD Yoong Hau Chun himself:

"Group managing director Yoong Hau Chun says profit margins from the mushroom cultivation will be better than its core business of manufacturing particleboards and ready-to-assemble (RTA) products. This [earnings margin] is what prompted us to look into the new business."

It's an excerpt from the latest interview in FocusM

Yawn.....I smell vinegar lol

free2invest, we're collecting and receiving more dividends. I counter all his stupid accusations. I said already that his maggi mee and maggi kicap both have more additives and preservatives that are man-made but he still consume them. Some eatery shops or stalls also use recycled oil to cook foods where stockraider stopped by to eat goreng pisang. So is he not having higher chance of being cancerous?

Where? Which line? Which statement by MD Yoong? Where? Can u be specific? I cannot wait for your respond lol

Where is toxic waste? Mushroom won't grow in toxic waste mah. Any more stupid statements?

真金不怕红烈火

free2invest, we're steady and sleep well at night while the naysayers had insomnia. Let them try talk nonsense and I will counter them so that whole world can see. Hahahaha

Only stockraider said particleboard is not safe to eat but whole world knows it's not edible. Get the irony? He hated and doesn't eat mushroom maybe he has phobia towards mushroom. He's still eating maggi mee once in a while or maggi kicap where both are man-made.

He's running out of stupid reasoning. Let's see what else he got. He lost tons of money or running out of patience to wait for his evergrn lol