Posted by kcchongnz > 2013-08-03 18:33 | Report Abuse

Go Bursa to see the "financial results". the "annual report" won't be out so soon.

Posted by kcchongnz > 2013-08-03 18:39 | Report Abuse

What is the intrinsic value of Haio?

“If we think through these questions, we can gain some insights about what may be called “owner earnings.” These represent (a) reported earnings plus (b) depreciation, depletion, amortization, and certain other non-cash charges less ( c) the average annual amount of capitalized expenditures for plant and equipment, etc. that the business requires to fully maintain its long-term competitive position and its unit volume. (If the business requires additional working capital to maintain its competitive position and unit volume, the increment also should be included in ( c) . – 1986 Berkshire letter

Warren Buffet stated that the value of a company is simply the total of the net cash flows attributed to the common shareholders (owner earnings) expected to occur over the life of the business, discounted by an appropriate interest rate.

To compute the intrinsic value of Haio, first we will need to estimate the current owner earnings based on Buffet’s interpretation. Next we need to assume a growth rate for the next 5 years. Then a terminal growth rate of 3% is used to assume that Haio will grow at that rate forever after that which is about the growth in GDP. These future earnings will be discounted to present value to obtain the intrinsic value of Haio.

The discount rate is related to what is the required return by the equity holders; i.e. how much risk premium above the risk-free rate would be required. For most practical purpose, in contrast with the academic approach in capital asset pricing model, a risk premium applied is related to how stable the earnings and cash flow of the company and its financial health. Haio’s earnings and cash flows have been positive for the last 6 years as shown in the Table 1 below. It has a healthy balance sheet. So it would be conservative to apply a risk premium of 6% above the MGS rate (currently about 4%), or a required return of 10% (4%+6%).

Next is the assumption of growth rate which is crucial for the determination of the intrinsic value. Last year, the revenue and profit of Haio grew by 12% and 21% respectively. Thanks to the growth in its multi-level marketing in the higher sale of food and beverage consumer products, personal care and wellness products. I will use a growth in profit of 15% for the next 5 years. Other data and assumptions are shown as below:

Data
2013 Revenue 268 m
2013 net profit 43.5 m
Capex 10.5 m
Depreciation 5.3 m
Working capital 35 m

Assumptions
Growth for the next 5 years 15%
Terminal growth rate 3%
Required return 10%
ROE in stable growth 12%

The discount cash flow analysis of the owner earnings yield an intrinsic value of 775m, or RM3.83 per share. At the close of its share price at 2.72 on 2nd August 2013, the margin of safety is 29%, or an upside potential of 41%. The question is what if the growth of the owner earnings is a different value? Table 2 below shows the theoretical intrinsic value of Haio at different growth rates.

Table 2; Scenario analysis
Growth rate 0% 5% 10% 15% 20% 25% 30%
Intrinsic value 2.15 2.61 3.17 3.83 4.62 5.53 6.59
Upside -21.0% -4.0% 16.5% 40.8% 69.9% 103.3% 142.3%
Haio at RM2.72 on 2/8/13

If the growth rate of Haio’s owner earnings is 5% instead of 15%, the intrinsic value is RM2.61. There is a downside potential of 4% if you buy Haio now at RM2.72. However, if the growth rate is higher than expected 15%, say at 25% for the next 5 years, its intrinsic value is RM5.53, or an upside potential of 103.3%.

So what do you think is the growth rate of Haio for the next 5 years?


Table 1: Earnings and cash flows of Haio
Year 2013 2012 2011 2010 2009 2008
Revenue 267920 239533 223254 511064 435216 373823
Net Income 43491 35702 29710 71863 53010 49118
CFFO 36359 50062 13870 69196 53427 53765
FCF 25834 47121 1582 65541 33721 51938

Posted by kcchongnz > 2013-08-03 19:36 | Report Abuse

Tan KW,
Here are the differences in ROIC and EY.

For Ebit, I notice that Haio has including 4.8 m in gain of disposal of land. Read the appendix to the financial statements. This is a one-off item. So I deducted it from its EBIT.

In IC, I included the investment properties as part of the fixed asset because if you read the financial statement, rental income is part of the EBIT.

In your enterprise value computation, you should less off the excess cash, not adding to it.

Posted by kcchongnz > 2013-08-03 19:49 | Report Abuse

Posted by Tan KW > Aug 3, 2013 07:11 PM | Report Abuse

@kcchongnz

i am not sure whether i am looking on the correct statements because i get a different numbers with you.. i am looking at http://klse.i3investor.com/servlets/staticfile/221258.jsp

Data
2013 Revenue 268 m
2013 net profit 43.5 m (based on CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME --> net profit = 48,291 while profit to owner = 47,432)

I HAVE ANSWERED THIS IN PREVIOUS POST.

Capex 10.5 m (based on CONDENSED CONSOLIDATED CASH FLOW STATEMENTS, Net cash used in investing activities = 4,350 or you get the number from somewhere else instead?)

THIS IS ARBITRARY. CAPEX 10.5M IS TRUE LAST YEAR.

Depreciation 5.3 m (based on CONDENSED CONSOLIDATED CASH FLOW STATEMENTS, Depreciation = 2,940)

YOUR VALUE OF D&A LAST YEAR OF 2940M IS CORRECT. I MADE ADJUSTMENT BECAUSE WE SHOULD LOOK AT THE AVERAGE CAPEX AND D&A FOR A FEW YEARS AND GET A FEEL OF WHAT SHOULD BE THE REASONABLE NET CAPEX, IE CAPEX LESS D&A. SO IF YOU JUST USE LAST YEAR'S, THE NET CAPEX IS TOO HIGH AT 7.5M. THE AVERAGE NET CAPEX IS ABOUT 5-6 M. SO I MADE A ARBITRARY ADJUSTMENT ASSUMING D&A IS 50% OF CAPEX. IT IS ARBITRARY I AGREE.

Working capital 35 m (where you get this??? is working capital same with Changes in working capital?)

WORKING CAPITAL IS OBTAINED FROM LAST YEAR, RECEIVABLES + INVENTORIES LESS PAYABLE

NO, WORKING CAPITAL IS NOT CHANGE OF WC, IT IS THE CHANGE OF WORKING CAPITAL FROM THE NEXT YEAR FROM THIS YEAR.

YOU NOTICE A LOT OF THING IS ARBITRARY. JUST THAT IT SHOULD BE REASONABLE AND MOST OF ALL MUST MAKE SENSE.

Posted by kcchongnz > 2013-08-03 20:02 | Report Abuse

Your EV is different from my computation.
No. of shares now is 202m
Excess cash includes "financial assets at fair value" as this is I think quoted securities.
Debt is not total liabilities. Debts is short-term and long-term borrowings.

Posted by kcchongnz > 2013-08-03 20:06 | Report Abuse

capex is the purchase of plant and equipment under the "net cash used in investing activities"

Posted by kcchongnz > 2013-08-03 20:11 | Report Abuse

My roic is also 29%. Yeah i know the values you used to compute is different from mine. There are some arbitrary opinions of which constitute fixed assets, and working capital, and also ebit. But don't need to be very precise. Again to reiterate that it is an art to interpret financial statement, Important it must make sense.

Posted by kcchongnz > 2013-08-03 20:12 | Report Abuse

It is late here now. Just post your other questions you may have. I will reply you tomorrow.

Posted by yungshen1 > 2013-08-03 20:17 | Report Abuse

kcchongnz how about knm.

Posted by apprentice > 2013-08-03 20:54 | Report Abuse

While you guys are busy chewing numbers, I wonder how long the MLM scheme will last. New membership requires money. Many new members take loans of 35 to 40K to join. With BNM ruling, such loans will be harder to obtain approval. The reason HAIO didn't do well in 2009/10 was members were disappointed they could not recoup their investment as its just a PONZI scheme and its difficult to recruit new members. New membership fizzled out. There are leaders of HAIO MLM driving BMWs, now in humble Protons, and their downlines cursing them as they continue to repay their loans. Sadly, many downlines are civil servants earning below 3K.
BTW they used to sell water dispensers, water filters and 'things you don't need' for more than 1K each and paid holiday to Australia for recruiters. Wonder if they are still doing the same.

Posted by Abudance > 2013-08-03 21:55 | Report Abuse

Apprentice. I was Haio few years back when it shot up to rm10 plus and then split. At that time, they went into China. Then they split if my memory holds.
My remisier firend said to buy when it was already rm8. I dare not as I thought it was an mLm co.
Fyi, Not all mLm are bad. Apprentice. Amway, pwroot and zhulian are doing well.... Consistently.

Posted by apprentice > 2013-08-03 22:10 | Report Abuse

I am telling from my experience with friends and survey.
Zhulian is direct sales, not MLM like HAIO where you need to deposit 33K to be a member and given 20 water dispensers.
That was what the downlines were getting. In order to recoup, they have to recruit new members and be reimburse 6K per member. Need I say more.
Suggest you all go down to the ground and mix with 'normal' people to know the truth.

Posted by Abudance > 2013-08-03 23:15 | Report Abuse

Apprentice, before you too down to people ... U should check your facts. Zhulian IS an MLM co
Zhulian Corporation-www.zhulian.com.my
Leading Public-listed MLM Company in Malaysia ... Events : Top Distributor Of The Year 2012 Roadshow Date: 22/09/2013 Venue: Mahkota Hotel, Melaka
You don't hold all the knowledge nd neither do I. We share so that we can help each other check out facts.

Posted by kcchongnz > 2013-08-04 08:47 | Report Abuse

Posted by apprentice > Aug 3, 2013 10:10 PM | Report Abuse
I am telling from my experience with friends and survey.
Zhulian is direct sales, not MLM like HAIO where you need to deposit 33K to be a member and given 20 water dispensers.
That was what the downlines were getting. In order to recoup, they have to recruit new members and be reimburse 6K per member. Need I say more.
Suggest you all go down to the ground and mix with 'normal' people to know the truth.

Anybody can verify this facts? deposit 33k to become member and given 20 water dispensers? If so are they still doing it? I don't think this model can sustain. That is the main reason why Haio failed in 2010-11.

On the other hand, MLM model is a good model in doing business if they are selling people on something useful and people need, such as health and wellness products. AS the population becomes more affluent, and aging, they become more conscious about health.

Yes, Amway, Zhulian etc are doing extremely well in their MLM business. MLM marketing also involves some moral issues, such as pushing people to buy expensive but not-much-use stuff. It is not everybody's meat.

Posted by kcchongnz > 2013-08-04 09:18 | Report Abuse

Posted by Tan KW > Aug 3, 2013 08:17 PM | Report Abuse

Ok, I make the modifications
and i get Earnings Yield = 58,716,000/455,231,000 = 12.90%
instead of EY=58716/407967=14.4%

my EV - 455,231 is different with yours - 407967....

NOSH 202,000,000
Stock Price 2.72
Market Cap 549,440,000
Debt 13,417,000
Minority Interest 11,090,000
Preferred Shares 0
Cash 118,716,000

EV = 549,440,000 + 13,417,000 + 11,090,000 + 0 - 118,716,000 = 455,231,000

IN THE NON-CURRENT ASSETS, THERE IS THIS 'FINANCIAL ASSETS" WHICH I BELIEVE IS A CASH EQUIVALENT ASSETS,PROBABLY A DERIVATIVE CONTRACTS WHICH HAS A CASH VALUE IF LIQUIDATED. AGAIN THIS IS JUST MY GUESS. THERE IS ALSO THIS "INVESTMENT PROPERTIES" WHICH I NORMALLY LESS IT OFF FROM THE EV BECAUSE THIS IS NOT THE ORDINARY BUSINESS OF MANY NON-PROPERTY COMPANIES. HOWEVER, LOOKING AT ITS FINANCIAL STATEMENTS AND NOTES TO IT, HAIO HAS TAKEN THIS AS PART OF ITS "ORDINARY" BUSINESS. HENCE IT WOULD BE WRONG FOR ME TO LESS THIS ITEM OFF FROM THE EV. SO IN MY OPINION, IF YOU REALLY WANT TO BE PRECISE, THEN THE EV SHOULD BE 549,440 + 13417 + 11090 - 1478 - 118716 = 454270.

by the way, how you get No. of shares now is 202m ??

based on Financial note B11, Weighted average number of shares = 197,658,000 - i believe HAIO have some treasury shares and treasury shares have been excluded on B11...

THE PAR VALUE OF HAIO IS 50 SEN, SO THE NUMBER OF SHARES IS SHARE CAPITAL/0.5=101095/0.5=202M. YOU ARE RIGHT ALSO AS THERE ARE SOME TREASURY SHARES, AND HENCE THE ADJUSTED NUMBER OF SHARES. BUT THIS DOESN'T REALLY MAKE MUCH DIFFERENCE TOO. MOREOVER THE TREASURY SHARES ARE NOT CANCELLED AND THEY STILL REMAIN THERE IN THE TREASURY. HOWEVER, YOU ARE RIGHT.

SO YOU SEE I TOO MADE SOME MISTAKES. I HAVE CORRECTED SOME OF MY MAJOR MISTAKES. GOOD THAT SOMEONE LIKE YOU CAN CORRECT ME.

Posted by kcchongnz > 2013-08-04 11:31 | Report Abuse

Tan KW, you can deduce the par value by looking at the earnings or the equity attributed to common shareholders and the share capital.

EPS=net income attributed to shareholders/No of shares, or NAB=Equity/No of shares.

Posted by bsngpg > 2013-08-04 11:55 | Report Abuse

Hi :
Among MLM i.e. Amway, HaiO and Zhulian, I like Zhulian the most for
i) highest div yield
ii) highest PAT
iii) highest net margin
iv) highest growing profit contribution from oversea ventures seeing the limited if not saturated domestic market
v) bigger market cap which is approaching the US$1bn market cap factor(in this perspective Amway is better)
vi) higher and more consistent growing rate in net profit
vii) self mfg products with no risk on discontinuation on exclusivity
viii) My Sifu, Mr. Fong SiLing is one of the major shareholder(his name is no longer appeared in Annual Report 2012, he may have sold some and converted to GTronic)

I started to accumulate the 1st batch of Zhulian in celebration for the birth of my daughter in 2008 at RM0.91 which is now almost zero cost after ~RM0.70 div so far and 1: 3 bonus in 2010.

Including those accumulated at higher cost after 2008, my current average cost is RM1.1 excluding the received div each year. So the div yield is about 0.155/1.1=14%. My point is buying a good high yield counter and keep for long term, we can achieve financial freedom. By the way, Zhulian has been locked for the education fund for my daughter who is at 5 now.
Thks

Posted by kcchongnz > 2013-08-04 12:19 | Report Abuse

par value is normally in RM1.00, 50 sen, 10 sen etc. So the no. of shares you have computed is close to share capital/0.5. so the no. of shares is share capital (101m)/0.5=202m. There is a small discrepancy because of the treasury shares. So for a normal case, no of shares outstanding=share capital/par value, or par value=share capital/no. of shares

Posted by faberlicious > 2013-08-04 12:45 | Report Abuse

good on you,bengpg. I still remember Zhulian's IPO price when it went public at RM 1.23.IT didn't do very well,fell below RM 1.00 to around 0.85 sen if not mistaken. I bought it @ 0.88-0.90 and have kept it ever since. Zhulian will grow bigger in coming years as it expand to Indonesia and that it one huge market.

Posted by bsngpg > 2013-08-04 12:47 | Report Abuse

Hi KC : to me, a non financial guy, you are very professional as you know how to use financial analysis tools and very kind and generous to share your homework. THANK YOU. I am following your posting and tracking your recommendation.
I like KFima as you and have accumulated since early 2011. My cost is low and thus yield is high and I will keep it for longer term. However I do not buy more as I have concern on its relatively small market cap and the pure color in Board of Directors. To me, a competitive company should be meritocracy oriented which should “generally” not a single color in BOD.
Thanks

Posted by bsngpg > 2013-08-04 12:57 | Report Abuse

Hi faberlicious :
Thanks for giving me an opportunity to communicate with the same fan of Zhulian. I am a fan on GTronic as well, how about you ? Regards

Posted by kcchongnz > 2013-08-04 13:23 | Report Abuse

Posted by bsngpg > Aug 4, 2013 12:47 PM | Report Abuse
Hi KC : to me, a non financial guy, you are very professional as you know how to use financial analysis tools and very kind and generous to share your homework. THANK YOU. I am following your posting and tracking your recommendation.
I like KFima as you and have accumulated since early 2011. My cost is low and thus yield is high and I will keep it for longer term. However I do not buy more as I have concern on its relatively small market cap and the pure color in Board of Directors. To me, a competitive company should be meritocracy oriented which should “generally” not a single color in BOD.
Thanks

I understand your concern. Every person is different. Anyway, there are thousands of companies to invest in Bursa, invest in one you are comfortable with.

Posted by kcchongnz > 2013-08-04 13:28 | Report Abuse

bsngpg, I share your view on Zhulian as below:

Posted by kcchongnz > Oct 19, 2012 01:45 PM | Report Abuse X
NZ,Is Zhulain a great company? Absolutely.
Zhulian's financial performance, balance sheet and cash flows are absolutely awesome. I did a detail analysis and made a valuation of Zhulian on 27/7/12 when it was 2.17. It has now gone up 27% to 2.75 now. Is it still a good investment at this price? Absolutely in my opinion. My discount free cash flows of owner's earnings using conservative assumption of 8% growth for the next 5 years and 3% thereafter with a discount rate of 10% shows the intrinsic value of Zhulian at 3.40, still another 24% upside. Well done NZ.


Also see my post from link below to see my comparison of Haio and Zhulian.

http://klse.i3investor.com/servlets/forum/900312629.jsp

Posted by bsngpg > 2013-08-04 13:55 | Report Abuse

KC : Thank you.

Posted by kcchongnz > 2013-08-04 14:03 | Report Abuse

bsngpg, just read some of your posts in Maybank thread. You are a good investors. Hope you can join in more of our discussions.

Posted by apprentice > 2013-08-04 14:44 | Report Abuse

Zhulian and Amway are good examples of MLM direct sales companies that sells quality products rather than dependant on membership fees. As this is the HAIO discussion, I did not want to drag other companies in, but just to highlight what HAIO's recruitment strategy is.
Though I study financial statements of companies, its just a history, and not necessary of what things to come. I prefer the feeling on the ground, talking to people directly involved or affected and have some idea where the product or company is heading to.
Today's analysts (banks and IBs) just sits in front of their computer and after keying some numbers, comes out with their magical target price. There is a particular counter which is terribly affected by the recent BNM ruling, yet many analysts are TP ing at 25 to 30% above its present price. I shudder to think of the consequences should it drop by 30% in 6 months time. The analyst will just downgrade the counter as price drops, leaving the poor investor who followed their recommended TP to hold the baby. But in this case, its the investor who is crying.

Posted by faberlicious > 2013-08-04 15:11 | Report Abuse

bsngpg, I own Gtronic before the share consolidation 5 into 1 exercise.That time it is around 20 sen ! only.Too bad I sold off all my Gtronic already. Gone..... :(

Posted by bsngpg > 2013-08-04 15:48 | Report Abuse

Hi KC and Apprentice :
We are investing with hard earned money. If one has doubt on Hai-O’s recruitment scheme, do not invest. Fong SiLing and Warren Buffett said that we should not invest if you do not understand the company.

My view : Haio recruitment scheme was skewed to membership fee before the revamp by government sometime in 2010/11 . I believe now it has changed and the uptrend in earning from MLM was achieved by healthy scheme, abiding the government new ruling. One very good point by Apprentice was that BNM ruling on personal loan which I believe somehow will slow down Hai-O’s MLM activities among civil servants.

Anyway, as I have doubt, I will not invest into. Even if I have no doubt, I will not invest into Hai-O at the current historical high on KLCI. I can wait, if I miss the boat, there are plenty of other boats coming.

By the way I very Respect and Appreciate sharing from KC and also the different view from Apprentice.
Thank you

Posted by kcchongnz > 2013-08-04 15:52 | Report Abuse

apprentice, agree with you in many aspects. I also wonder why the analysts still recommending that stock (hope that is the one you refer to) you mentioned despite the recent Bank Negara ruling.

That membership fees you are talking about of Haio, 33k, still the same thing? and selling expensive but useless stuff through MLM? Or was it the case in 2009-2010 before the new rules of direct selling which adversely affected Haio's MLM and now it is not the case any more? You definitely know better than many people here since you have friends there. Could you verify and confirm that?

Your statement "Though I study financial statements of companies, its just a history, and not necessary of what things to come. I prefer the feeling on the ground, talking to people directly involved or affected and have some idea where the product or company is heading to."

Yeah, talking to people etc is what Philip Fisher called scuttle-butting. It is a must if you want to be a very successful investor. But few people have that kind of luxury, don't you think so? So for people who don't have that luxury, how should they invest? Or how would they know the company they are interested is worth investing?

Ok everybody on the street say this company is good. The company products are good but how do you know they make good profit? And how much are you willing to pay? How do you decide?

Yeah those financial statements are history but what else can we rely on to decide and answer those questions above? What do you think about this guy Joel Greenblatt's investing strategy of investing in good companies at reasonable and cheap price from the link below?

http://klse.i3investor.com/blogs/kianweiaritcles/34313.jsp

Posted by Abudance > 2013-08-04 16:06 | Report Abuse

Thanks for all good sharing. What about pwroot?

Posted by iafx > 2013-08-04 16:14 | Report Abuse

@apprentice, f.statement(multiple) must be combined then only the picture is complete for further assessment, say rolling 4 qtrs at least. another "risk" is all statement went thru some level of "massage", therefore regardless v can never trust it 100%, cannot invest 100% base on paper value.

Posted by iafx > 2013-08-04 16:25 | Report Abuse

the same go to analyst TP, often it has something to do with commercial relationship, counter in IB portfolio tend to get better rating, talk only the bright side, ignore dark side :)

Posted by apprentice > 2013-08-06 08:30 | Report Abuse

Thank you to those who contributed, kc, iafx, bsn, abundance. It good to throw a few spanners into the works and get good feedbacks.

Posted by ipomember > 2013-08-06 08:57 | Report Abuse

"Today's analysts (banks and IBs) just sits in front of their computer and after keying some numbers, comes out with their magical target price" Well said, thats why we do not simply put in the data to compute the fair value. otherwise its really misleading

Posted by kcchongnz > 2013-08-06 14:04 | Report Abuse

Tan KW, yeah I have read your posting on this. Thank you for the good article.

I wrote my piece on Haio just based on my own thought without reading any articles about Haio from any analysts. Reading the above posting by you, it appears that my thought was very similar to that analyst. I didn't have information about that part on potential higher dividend payout though.

Posted by FATT > 2013-08-06 14:20 | Report Abuse

at what price?

Posted by kcchongnz > 2013-09-20 09:35 | Report Abuse

Haio reported a poorer results for the first quarter 2014. Investors reacted strongly to this poorer performance, the price has already dropped by about 5% this morning.

That is why I always say valuation is an art. It depends a lot on your forecast in the future, and nobody can predict the future. He can only use the economic outlook and its recent past to try to have a good guess of its future. Hence in valuation I like to use conservative assumptions to get the intrinsic value, and buy the share when there is good margin of safety.

But does Haio warrants for a sell off just a poorer one quarter result? Is the poorer result due to seasonality?

To me, it depends on whether you are a trader or an investor.

Posted by ryanc > 2013-09-20 10:21 | Report Abuse

Good way to cover up a lousy stock pick. :)

Posted by iafx > 2013-09-20 10:22 | Report Abuse

:D

Posted by kcchongnz > 2013-09-20 10:35 | Report Abuse

Hey iafx, long time no see. Try making fun of me? Good, I am always ready for you.

Have you sworn that you did not change the "revenue" to profit in the Kfima thread? So long still haven't seen the response from you yet.

Posted by iafx > 2013-09-20 10:38 | Report Abuse

@ryanc, chill! :D

Posted by kcchongnz > 2013-09-20 10:42 | Report Abuse

iafx, remember also that Pintaras you criticizing like mad on my analysis. You even asked people to sell at 2.70, just less than a year ago? It is RM6.08 now, not including 19 sen dividends received.

What say you?

But actually the worst part of you is to change that word "revenue" to "profit" and then came back and accuse me of changing. That is the worst from of cheating and accusing.

How do you aspect people to respect you?

Posted by kcchongnz > 2013-09-20 11:05 | Report Abuse

As to the statement below. Let me just say I don't have to cover up anything and no need to be defensive also. Not until if he starts to attack personally.

Posted by ryanc > Sep 20, 2013 10:21 AM | Report Abuse
Good way to cover up a lousy stock pick. :)

I am more interested to know why this iafx fellow can change something in the Kfima thread, and then kept on accusing me altering it, and then kept on and on to attack me personally.

But how ah? Every time he appears to make a jab at me, then when I ask him something about the credibility of him as a person, he just disappears?

Posted by bsngpg > 2013-09-20 15:12 | Report Abuse

Hi : I am very please to inform that I am now officially one of the member of Hai-O after buying in at 2.62 just now. I started a very close following process since Aug13. Today the opportunity appeared, so I just grabbed it. I plan to keep it for very long term as long as its fundamental does not deteriorated. If it drops further later, I will accumulate more. Thank you.

Posted by kcchongnz > 2013-09-20 15:39 | Report Abuse

bsngpg, how come you also buy Haio? I think Zhulian is a better stock in this business. Yeah I know you already been holding Zhulian for long time. I would think it is still good to hold.

But on the other hand, good to diversify a little bit. I do believe in diversification, theoretically as well as practically.

Posted by bsngpg > 2013-09-20 19:37 | Report Abuse

Why I bought Hai-O :
i) Use hard money to show support while people said you cover up.
ii) You said “good to hold Zhulian” while buy on Hai-O. So listen to you lol.

Actual reasons are “Buy when others sell” and diversification. Furthermore Hai-O will not pull down my grand div yield.

At the moment I still have faith that Hai-O has good growth trend in long term. The best opportunity is that when I have confident on long term earning of a company and others sold due to short term jerk on earning.

I want to share that I can wait patiently since 4 Aug till today to buy in the targeted counter.

Thks
Thks

Posted by lwalk > 2013-09-20 20:09 | Report Abuse

bsngpg, is there a reason to buy at this current price? today it looks as it might be a one day drop for consolidation or falling knife...price is still high from all the climbing up few days before. you seem like a very experienced investor.. so i do value your input.

Posted by ipomember > 2013-09-20 21:00 | Report Abuse

@bsngpg
"At the moment I still have faith that Hai-O has good growth trend in long term. The best opportunity is that when I have confident on long term earning of a company and others sold due to short term jerk on earning. "


Well, would likely to hear from you about MLM business. As we know, MLM business always selling their "premium" products in "premium" price, ANWAY is a real good example. We can see retail shop for this MLM business as well (Well i do not know much on it, do they have retail shop for long time ago?) Anyway i am not familiar with it and hopefully you can share me with your insights. Thanks first.

Posted by faberlicious > 2013-09-21 18:27 | Report Abuse

I'm also now a shareholder of Hai-O,just bought @2.61.My

collection is now complete.I've all 3- Amway,Zhulian and Hai-O.Nice !

Posted by kcchongnz > 2013-09-21 18:38 | Report Abuse

Faberlicious, good on you. In my opinion, they are all good companies. Why good companies?

When a company has high margins, high roe, ROIC and great cash flows consistently, how not to be good companies?

Best still if they are selling at reasonable or even cheap price.

How do we know their business model is good? Isn't it all shown in those consistent metrics? What other proof do you need?