Posted by CFTrader > 2016-03-10 21:58 | Report Abuse

Hi. Please be informed that the European had scrap the anti-dumping tax of China ... ...

Posted by CFTrader > 2016-03-10 21:59 | Report Abuse

and Hi, please be informed that the order had being held back as the purchaser is waiting for the price from Chinwel's competitor , which is China ...

Posted by stockmanmy > 2016-03-10 22:14 | Report Abuse

I like your style , fast.

You done a lot of work

You are not just a story teller like somebody.

Posted by hng33 > 2016-03-10 22:36 | Report Abuse

Yup, today alrdy accumulate a lot at 1.63- 1.64 which is still trade cum dividend of 4sen. Expect stock price to rebound above 1.70 soon.

Posted by BoPoint > 2016-03-10 22:57 | Report Abuse

There is no reason to command a 10x PE esp in a business that has no moat and competitive advantage. 21 sen earnings assumption have no valid reason too. Investors please never forgot to look into business models. If one has no moat or progressive business growth and sustainability, strong discount should be considered rather than assumption based on macro factors. Even financial valuation alone (without taking the business model into account), I shall refute this article's TP. Thanks.

Posted by CFTrader > 2016-03-10 23:00 | Report Abuse

Do anyone consider the 1st comment I bring it up ?
Today during the analyst briefing, MAYBANK had told us that due to scrap of anti-dumping policy, their fastener profit margin will shrunk to single digit.

This is the guidance given by their management.

Posted by oi88 > 2016-03-10 23:03 | Report Abuse

Selling pressure for today is strong with high volume, dont think is it due to small retailer, big boys selling heavily, maybe CFTrader is right.

Posted by CFTrader > 2016-03-10 23:09 | Report Abuse

no, i'm not talking about share price.
I'm not big boys either, so I don't know the fluctuation of CHINWEL price.

I'm talking about fundamental changes...
Things change. Effective from 26 Febuary, they scrap the policy already, and you state it as advantage is a big wrong information.

Posted by stockmanmy > 2016-03-10 23:16 | Report Abuse

when a share trades at NTA and low PE....everybody so scared..................


wait till a share trades at 2X NTA and PE 20....everybody not scared.


and as far as EU is concerned, they will not kill their own companies to benefit China...that is for sure.

Posted by Icon8888 > 2016-03-10 23:18 | Report Abuse

if EU doesn't comply, China will retaliate with duties on other products

messy

I think EU will comply

Posted by Icon8888 > 2016-03-10 23:20 | Report Abuse

if that happens, fair value about RM1.20

Posted by Icon8888 > 2016-03-10 23:21 | Report Abuse

in the face of so much uncertainties, better exit

Posted by Icon8888 > 2016-03-10 23:22 | Report Abuse

cut loss, even if your cost is 2.10

it is not fun for 2.10 to become 1.20

Posted by Icon8888 > 2016-03-10 23:23 | Report Abuse

that would be about 47% loss within two months

not an easy feat

only accountant can pull it off

Posted by oi88 > 2016-03-10 23:25 | Report Abuse

Big boys selling ahead of news, retailer always late.

Posted by soros228 > 2016-03-10 23:29 | Report Abuse

No wonder chin well keep on diarrhoea.

Posted by soros228 > 2016-03-10 23:36 | Report Abuse

There must a reason why it's keep dropping.
Icon8888 u got a good point.

Posted by Ven Felix > 2016-03-10 23:39 | Report Abuse

Desa has very high hope to Chinwell, once a must pick as an account clerk.

Posted by Ven Felix > 2016-03-10 23:40 | Report Abuse

Next, is highly illiquid gem; highly recommend by Desa. ..Keinhin

Posted by Ven Felix > 2016-03-10 23:42 | Report Abuse

Reason for Desa to eye on Keinhin, bcoz their bosses are real rich people...and highly tight hold that lead to high illiquid xD

Posted by hng33 > 2016-03-10 23:46 | Report Abuse

Ok, Let's see how market response tomorrow, chinwel price either continue slump down or rebound a bit, will set exit price based on average cost 1.637, either can reap profit or cut loss to free up capital.

Posted by Hahahahaha > 2016-03-10 23:47 | Report Abuse

Hahahah CFTrader dun tell half dun tell half please~ i was at the briefing also..
The single digit only applies to certain products.. and only certain products are subject to benefits of anti dumping regulation.. hahhahaa ask ur Maybank brief more precise..
Their business are DIY driven.. See their MSIA sales~~ today they told what are the MSIA growth going forward no? What are the wire products margin going forward no?

Dont create fear to buy cheap please~ hahahhha

Posted by soros228 > 2016-03-10 23:49 | Report Abuse

Once down trend ; will be difficult to climb already.
It will take some time lol.
It's your call dude.
Either u jump into another counters lo.

Posted by Hahahahaha > 2016-03-10 23:50 | Report Abuse

Icon8888 no nid think.. EU has already complied and posted on their website stating the regulation was removed... The main issue is not about whether EU remove or not.. Do you all know how small are their products that are subjected to benefit of Anti Dumping? hahaah their other orders have long been better than China products in terms of quality... Ask CFTrader tell you what was in the briefing instead of only talking negative
hahahha u all can continue create fear... i am collecting happily~~ hahahaaa

Posted by Icon8888 > 2016-03-11 00:00 | Report Abuse

yup, it has been removed on 28 February 2016

big wok liao

http://globalfastenernews.com/main.asp?SectionID=26&SubSectionID=39&ArticleID=14689

Posted by CFTrader > 2016-03-11 00:25 | Report Abuse

Chin Well (MYR1.67): Anti-dumping repealing to affect ~10%
We attended Chin Well’s 2QFY6/16 result and corporate update briefing today. The repealing of anti-dumping law in EU for fasteners from China (effective 26-Feb) may not be as bad as it seems.

In terms of numbers, only its bulk sales of bolts may be affected, which makes up 20% of EU sales, i.e. MYR56m (~11% of FY15 revenue). In the likely scenario of margin compression due to the need to match China’s pricing, management has guided for single digit margins. This division is enjoying ~15% PBT currently. If this halves to 7.5%, the estimated PBT reduction is MYR4.2m, i.e. less than 10% of FY15 PBT.

We also find comfort in (1) China’s labour cost increase; (2) part of the repealing involved a promise of being more environmentally friendly, lowering CO2 emissions and proper waste water treatment (Chin Well pays MYR0.6-0.7m every month); (3) China’s promise to cut 15% output over five years; (4) Failure of China manufacturers to stock up on wire-rod which saw prices shoot up 30% since January; (5) perception of inferior quality of China products; (6) most customers would source from various countries (as per past practice) for risk and cost hedging.

It is hard for China to penetrate the DIY market as it is labour intensive and there is usually a 1-year customer audit period. Cost wise, environmental cost increase could mean a levelled playing field for others vs China by 2020. Lastly, there will also be a time-lag of at least a few months before China’s threat materialises, due to the above mentioned factors.

Having said so, the fact is everyone is holding back big/bulk orders awaiting China players' pricing. Chin Well has only received small urgent orders during this period.

Whilst it will be hard for Chin Well to repeat its 1HFY6/16 PATMI growth of 113% with the expected headwinds, management has shared two expansion plans.

It intends to invest ~USD400k for a gabion machine end-2016. Currently, its gabion and fences capacity are fully utilised. In 2Q, wire product revenue jumped 28.2% YoY as it secured more new projects in Malaysia and began regular supplies overseas.

Chin Well is also looking to set up a recurring source of income. It has commenced construction of a new automatic warehouse in Port Klang for MYR12.8m, which will complete within 6-9 months. It plans to utilise 30-40% of the space, whilst renting the remaining out for storage of hardware related items. At 80% utilisation, management hopes for ~MYR2m p.a. contribution.

Separately, on the US side, it seems that the worst is over. Orders are coming in, though not consistently and not at previous levels. PrimeSource is Chin Well’s only customer in the US and the supplier of Home Depot. The PrimeSource takeover resulted in inventory rationalisation and order halts (due to over stocking previously) which affected Chin Well significantly.

The group’s balance sheet remains solid. It currently has a net-cash position of MYR71.4m.

As its stellar performance is not expected to continue into the 2H, we look at its 12M trailing EPS of 20.7sen (vs. annualised 1H EPS of 24.6sen). The stock is trading at 8.1x trailing EPS, which is below its 3-year historical average PER of 11.4x.

Posted by stockmanmy > 2016-03-11 00:49 | Report Abuse

From the businessman perspective.

If you can find me a business with good management , trading at NTA and low PEs, you invest.

You do that consistently, you will be hugely rewarded by the stock market. .....that is called investments.

every thing else is talk three and talk four and fear.

Posted by Mok Tuck Hau > 2016-03-11 01:11 | Report Abuse

http://trade.ec.europa.eu/doclib/docs/2016/february/tradoc_154326.repeal.en.L52-2016.pdf

Posted by JT Yeo > 2016-03-11 08:01 | Report Abuse

Please be mindful that capex has been lagging behind depreciation since 2011 or probably even longer. It could be a sign the company is underinvest, thus inflating FCF. And when you look at the total assets has been failing for 4-5 years already, you need to ask can they continue to grow revenue with less and less assets? Something got to give.

Posted by fast > 2016-03-11 08:29 | Report Abuse

CFTrader: Thanks informing. JT: I'm happy if Chinwel able to do well with less and less assets, meaning their efficiency is increasing.

Posted by fast > 2016-03-11 08:32 | Report Abuse

JT: Just checked, Chinwel assets still growing...

Posted by JT Yeo > 2016-03-11 08:55 | Report Abuse

http://financials.morningstar.com/balance-sheet/bs.html?t=5007&region=mys&culture=en-US

Posted by JT Yeo > 2016-03-11 08:57 | Report Abuse

Refer to the link above, sorry not total assets but property plants and equipments assets - those are the one that drive revenue. It is going down from 183 mil to 155 mil. You may be right they are becoming efficient, but it is assumption.

Posted by Icon8888 > 2016-03-11 09:04 | Report Abuse

a company as competent as Chin Well is unlikely to save money at the expense of future prosperity (kill the goose to extract eggs)

one possibility is that actual wear and tear is lower than depreciation charges

depreciation charges is an accounting figure (straight line reduction irregradless of what happens to the machines and equipment)

capex on the other hand, is dictated by actual wear and tear

if the equipment is maintained well, they will need to spend less on capex (despite higher depreciation charges) and yet maintain the same amount and quality of equipment for production

Posted by JT Yeo > Mar 11, 2016 08:01 AM | Report Abuse

Please be mindful that capex has been lagging behind depreciation since 2011 or probably even longer. It could be a sign the company is underinvest, thus inflating FCF. And when you look at the total assets has been failing for 4-5 years already, you need to ask can they continue to grow revenue with less and less assets? Something got to give.

Posted by JT Yeo > 2016-03-11 09:44 | Report Abuse

again everything is up for interpretation. We are dealing with uncertainty. Their long term ROE is sitting at 10%, which is mediocre.

Posted by hng33 > 2016-03-11 09:57 | Report Abuse

thanks icon, alrdy sold at 1.65, avoid loss, free up capital

Posted by enning22 > 2016-03-11 10:44 | Report Abuse

a lert! Europe anti-dumping duty tax has just benn cancelled, a few days ago

Posted by stockmanmy > 2016-03-11 10:57 | Report Abuse

alert yes......but did you notice there are a lot of buyers there? there are people who like to buy when things are cheap.....hahahaha

=======================
ed by enning22 > Mar 11, 2016 10:44 AM | Report Abuse

a lert! Europe

Posted by andersonleee > 2016-03-11 11:09 | Report Abuse

http://www.chinadaily.com.cn/bizchina/2016-01/20/content_23161623.htm

Posted by moneySIFU > 2016-03-11 11:16 | Report Abuse

Very very good discussion here, nothing to do but do reading here.

Posted by Probability > 2016-03-11 11:33 | Report Abuse

totally agree with Icon's point on Depreciation there...

Posted by tftey > 2016-03-11 14:51 | Report Abuse

China won at WTO case and the antidumping factor would be big negative factor for ChinWell.

Posted by Beza > 2016-03-11 15:21 | Report Abuse

Correct.

Posted by Jones Ong > 2016-03-11 22:37 | Report Abuse

kana miko point good let time tell the truth

Posted by soros228 > 2016-03-11 22:50 | Report Abuse

1. Share price dictate the future direction of the company.
If the share price keep on diarrhoea; the prospect is guarded.

Posted by stockmanmy > 2016-03-11 23:46 | Report Abuse

kana....that is what a well managed company do....they turn adversity into advantage.

Posted by VenFx > 2016-03-11 23:51 | Report Abuse

Europe $ QE,lead to $ depreciation..that's the core issue.