Posted by SS661M > 2014-10-17 18:16 | Report Abuse

The are the events end of next month:
suspend for trading for announcement. Listing to mainboard approved. 3rd quarter result very encouraging. Propose special dividend.

As a result of these encouraging factors:
share price sky rocketing. UMA is issued to MMode.

This is what happen to goflykite:
He feels too sorry for misjudging MMode. He totally miss the boat to wonderland so he goes fly kite in Holland.

Posted by goflykite > 2014-10-17 18:19 | Report Abuse

Go check the link below:

http://www.bursamalaysia.com/market/listed-companies/company-announcements/1768941o check the link below:

Posted by goflykite > 2014-10-17 18:20 | Report Abuse

Net profit shrank 30 millions!!

Posted by goflykite > 2014-10-17 18:23 | Report Abuse

Main board transfer still pending the approval from relevant authority

Posted by goflykite > 2014-10-17 18:31 | Report Abuse

Don't believe this mmode is still a diamond...don't be conned by the conman TradeInvestStock!!

Posted by goflykite > 2014-10-17 18:35 | Report Abuse

SS661M, welcome on board the flight to Holland...

Posted by goflykite > 2014-10-17 18:39 | Report Abuse

No need to wait next month...by next week itself mmode share price will nosedive as selling pressure intensified... UMA will be issued due to share price has dropped more than 30%..

Posted by SS661M > 2014-10-17 19:30 | Report Abuse

Magic formula by Joel Greenblaat:

Share price: 52sen
(all no. in thousand)
Total outstanding share: 162,709
Market cap: 94,371
TTM EBIT: 10,763
Minority interest: 0
Borrowing: 1,961
Excess cash: 41,696

Assume that we buy the entire company in open market, pay all it's debt & minority interest and pocket all it's excess cash

Enterprise value, EV = Market cap + total borrowing + minority interest - excess cash = 54,636

So, what is the annual return of this investment?

Earning yield, EY = EBIT/EV =19.70%

Is 19.7% good? Lets ask Warren Buffett. According to Warren Buffett, If we flip the EY formula; EV/EBIT < 7, we probably found a under valued investment. What is MMode's EV/EBIT?
1/19.7% = 5.08. Way bellow Warren's magical number 7.

How efficient is MMode's asset utilisation? We'll look into return on invested capital; ROIC

a.)Investment in associate: 586
b.)Development cost: 5,492
c.)Total Receivable: 11,666
d.)Inventory: 0
e.)Property plant & equipment (PPE): 9,392
f.)Payable: 2,399
Invested capital, IC = a+b+c+d-f = 24,737
ROIC = EBIT*(1-Tax rate) / IC = 37.14%

How good is ROIC 37.14%? Much better than ROE of the same percentage.

Ok, I got something to do now. Latter in the evenning i'll do discount cash flow on MMode to find it's intrinsic value.

Posted by Iching88 > 2014-10-17 19:50 | Report Abuse

yes...


MAGIC.....wah ka ka ka ka ka...


80 drop to 50..

MAGIC!!!!..


wah ka ka ka ka ka .....

Posted by goflykite > 2014-10-17 20:44 | Report Abuse

So you must have holding power and make sure no panic selling when seeing share price nosediving... Hopefully they maintain the dividend payout policy...

Posted by SS661M > 2014-10-17 22:00 | Report Abuse

@Iching88. If 80sen there is no magic. At current price it is real magic. So simple also dun understand? Really pity u.

Posted by SS661M > 2014-10-17 22:07 | Report Abuse

goflykite. I assume u alr sold all your share. Why u so concern about this counter? Wat is your motive? U haven't got money so u dun wan it to hike too fast?

Posted by EdwinS3 > 2014-10-17 22:43 | Report Abuse

Today report shown revenue is up but net profit is down, wonder how much it will drop on Monday?

Posted by SS661M > 2014-10-18 09:22 | Report Abuse

@kun1971kun. Can consider walk away if u only have a few counters. This one can drag down your return significantly. I've 12 counters & 10 are very promising. I dun mind to give MMode a chance bcoz I can afford to.

Posted by NOBY > 2014-10-18 16:52 | Report Abuse

I guess its sell sell sell due to the 50% drop in profit... all ppl look for is growth growth growth... i guess there will be another cheap mega sales on Monday....

I still feel that MMODE is a value buy at current price. Net cash of RM0.24 per share. That's almost 50% of its share price. Adjusted PE after subtracting net cash is only 5.3x. Can the cash position deteriorate significantly ? I dont think so, they still generate good cashflows and their cash position continue to grow and debt reduce. MMODE has had 3 years of unabated growth, reversion to the mean is inevitable. With ROIC is excess of 40-60 % last year, competition will definitely want a piece of the pie. This is just capitalism at work.. Even for now, their ROIC is still a respectable 28% selling at EV/EBIT of only 4.3x, a classic magic formula stock.

Management will either need to enlarge revenue base to arrest drop in net profit or invest more into RnD to gain back the competitive edge.

Posted by SS661M > 2014-10-18 17:56 | Report Abuse

Hi, Noby. Did you include goodwill on consolidation in IC calculation? I guess that's way you get ROIC 28%. Is it appropriate to classify goodwill as IC?
Ya.....I made mistake in market cap calculation. It should be 84.609mil instead of 94,371mil. This will lower EV/EBIT to 4.3x.

Net cash 24sen cash per share. That's mean it's ongoing operation only worth 28sen now. Still can drop further? Ya..Market is irrational. Anything can happen. Loss making co. can also be pumped high to the ceiling.

I think the problem with MMode is it grew drastically in the past three years. Ppl just put too much expectation on it. Just like a kid scored A+ consecutively but all in a sudden scored an A-. The parents just heart broken. An A- is still an A isn't it?

Thanks for your input.

Posted by kun1971kun > 2014-10-19 12:18 | Report Abuse

really don know wat to do...i have holding power....maybe just keep it for a while.......

Posted by kun1971kun > 2014-10-19 21:00 | Report Abuse

NOW I HAVE 4 COUNTERS。。。ALL RUGI。。。。MMODE + XDL+ KARYON + OPCOM。。。HAVE TO WALK AWAY

Posted by SS661M > 2014-10-20 07:37 | Report Abuse

Earning is easy to fabricate. I did that quite often. When I need borrowing, I boost earning to impress bankers in the expenses of higher tax payment. When I don't need borrowing I keep earning as low as possible to save tax. If the bank officers can read financial statement in detail up to balance sheet and cash flow statement, I won't be able to get through so easily. Therefore, I believe balance sheet and cash flow statement are much more reliable than income statement. Notice that MMode' revenue is increasing. It is different from Zhulian's situation where revenue dropped drastically. What could have happened to MMode?

1. MMode MSC 5 years tax allowance is expired. Keeping low profit margin can save tax expenses.
2. MMode is in the process of flushing out competitors in the expenses of lower profit margin.
3. MMode is trying to achieve a turnover that is needed to satisfy mainboard listing requirement. Again, in the expenses of lower profit margin.

A great investor who I forgot his name once said that a company is worth all it's future cash flows discounted to the present value (pls help to rephrase my statement if I left some words). He and a few others also said that discount cash flow is the only correct valuation method. I believe them so I stay. MMode is sitting on 40million cash. It can venture into other areas to boost income easily. I could be wrong but I am willing test the theory. Good luck and I need it most.

Posted by samcghee > 2014-10-20 09:30 | Report Abuse

kun1971, if i am you, I will sell all liao. This company is going reverse gear. I already sold out all liao. You can select other counters that is better than mmode.

Posted by kentg03 > 2014-10-20 10:31 | Report Abuse

me 0.699 and still holding. will try to average down the price first.

Posted by SkyWalk > 2014-10-20 16:01 | Report Abuse

Aiyoo, me RM 0.775

Posted by SkyWalk > 2014-10-20 16:14 | Report Abuse

Provided business still run, why worry,sure will rebound one day,share market same like 棺材店，总有一天等到它。

Posted by samcghee > 2014-10-20 16:26 | Report Abuse

Wah, so many people traping with this stock. Pls be patience to wait it going up.

Posted by kentg03 > 2014-10-20 18:14 | Report Abuse

Pls don't 等到花儿也谢了

Posted by yklip > 2014-10-20 19:30 | Report Abuse

kun1971 me @ 0.71 we're on the same boat...

Posted by bursafreeman > 2014-10-20 23:36 | Report Abuse

SS661M, I like your thought from another perspective. Just that the Q3 result and the price action are so negative about this company. Increase of operating cost isn't favor to investor. May be you are right, they are trying to reduce the income tax. But how can investor know in-depth of the company intention? At least we have chance to ask them in AGM.
22 Oct we should know if their transfer listing is approve or not. If not, need to wait another couple of months. Again, this also trigger investor to think, is there any thing wrong with this company? Why SC took so long for the approval.

Posted by SS661M > 2014-10-21 07:58 | Report Abuse

brusafreeman. I visited your blog & find it very informative & educative. Gud job! You are right, nobody knows what is going on unless he/ she has insider infor. I stay on not because of main board listing. I believe a strong & healthy man (reflected in balance sheet) with good diet and healthy lifestyle (reflected in cash flow statement) can easily recover from illness (reflected in income statement). Can we stay healthy in our entire lifespan? Surely we will suffer from illness ocationally, right? Anyway i would have cut loss if i knew i can buy back at 0.485. I am no hero or die hard fan. The drop is just too sharp & i missed the chance to cut loss.

Posted by samcghee > 2014-10-21 13:55 | Report Abuse

Wah! I betul-betul "kei sian" to those people who are still hoping mmode will show a good results for coming quarter. Mmode really faced stiff competition right now. GST coming liao wich will erode the profit some more. Please think twice before further buy in order to cut loss or average down the price.

Posted by SS661M > 2014-10-21 16:23 | Report Abuse

Talking about GST. The enlarged cost of sale is an avantage. GST = output tax - input tax. Increase in cost of sale will increase input tax, which results in lower GST. Apparently, it will also decrease income tax expenses. From now on merchants will be very particular with billing on cost of sale. If they don't do it right they will end up absorbing part of the GST for end users. If you are not in business allow me to show you an example:

If my supplier sell me an item @$100, he bills me $106 ($6 is the input tax). When I sell the item @$150, i bill end user $159 ($9 being the output tax). GST due to govt = $9-$6=$3. What if i don't record the cost of goods properly? I don't have any input tax then. GST due to govt = $9-$0=$9.
We can expect increase in cost of sale in all sectors.

Posted by kentg03 > 2014-10-21 20:04 | Report Abuse

Mmode today very steady. Still no news for the transfer?

Posted by SS661M > 2014-10-21 20:56 | Report Abuse

The most dangerous circumstance is you dun know how much you are going to loss. It has hit the bottom alr. At least you know it won't get worse.

Posted by bursafreeman > 2014-10-22 14:34 | Report Abuse

I just concern if they delay is due to company unable to meet the requirement or SC keeps asking for further fine tune of their accounts.

Posted by SS661M > 2014-10-22 16:14 | Report Abuse

I mistakenly identified brusafreeman as brusa dummy. Hehehe....... I actually visited brusa dummy site recently. Hi, brusafreeman. Notice that MMode published their quarter report a month earlier? I guess we'll know the result soon. Hopefully a gud one:))

Posted by ehtan > 2014-10-25 14:16 | Report Abuse

waste time share!!!OCK already transfer to main board already. OCK's announcement date to transfer is on 14th May 2014 and MMODE announcement date to transfer is on 16th April 2014 whereby MMODE take longer time to get approval from SC. OCK also issued bonus whereby MMODE do not issued any bonus. As refer to early this year both shares are around rm0.70 but as dated on 24th October 14, OCK share price is RM 1.46(already profit >100% return) and MMODE share price is RM 0.50(already loss around 30%). No comment on MMODE is strong and healthy man but there are a lot of strong and healthy man(uptrend share) out side there.

Posted by SS661M > 2014-10-25 16:23 | Report Abuse

Correct. Never put all eggs in 1 basket. If you happened to spread your eggs in 10 basket & get 8 gud basket gud enough alr. MMode apparently isn't a v.g basket but wat to do? Who on earth can be 100% right? At least it isn't a rotten basket.

Posted by SS661M > 2014-10-25 17:16 | Report Abuse

OMG! OCK's turnover is twice of MMode's. May be my assumption is correct. MMode is scarifying profit margin for higher turnover.

Posted by Iching88 > 2014-10-25 20:24 | Report Abuse

TP for MMODE is 0.61.


wah ka ka ka ka...eat that.

Posted by SS661M > 2014-10-25 20:28 | Report Abuse

Pika.....another KC's student? Hehehe........ I like to hang around with troubled counters. Those gud one no point to talk so much. They're auto pilot.

Posted by SS661M > 2014-10-25 20:31 | Report Abuse

Why TP = 0.61? Who gives the TP?

Posted by SS661M > 2014-10-25 20:57 | Report Abuse

Like to hear wat TA ppl will say about this counter. In the end of the day, the fate of this counter is determined by TA ppl. FA ppl are just minority.

Posted by SS661M > 2014-10-26 07:29 | Report Abuse

@Pika. TA & FA used to be different school of thought, but nowsaday there are so many mutants that have both skills. I've very shallow FA skill but zero TA skill. Like to learn from you.

My defination of FCF is net cash flow from operating activity - net capex*
*only capex related to core business is considered. The following is my FCF figures:
(all no. in thousand)
2013 FCF =13,195 - 3,144 = 10,051
Last 4Q FCF = Q3'2014FCF + Q4'2013FCF - Q3'2013FCF = 6,700 because cash flow statement reports cumulative figures for the financial year.

Ok, now is my turn to learn from you. I notice that from 26Aug - 26 sept, share price was almost flat, in fact slightly downwards with very low volumn. It was controlled selling at a narrow price range, right? That should rang my bell, but the problem of having many counters is that i can't monitor the price movement in regular basis. In this case even forgot to cut loss, hehehe...... When you said "should it have bottoming sign, with increased volume", i assume you mean the current low volume at 0.475c could be controlled selling too, right? We need increased volumn to form a strong support in order to comfirm it is a bottoming sign, right?

Posted by SS661M > 2014-10-26 07:35 | Report Abuse

Any good site to learn TA? Pls recommand. Tq.

Posted by SS661M > 2014-10-26 20:57 | Report Abuse

TQ for the detail explaination. Lets see if i got your points.

19Feb-3Mar: Break the ice
4Mar-2April: Liquid phase
3Apr-28May: Jump the creek (3 cycles of goreng up & consolidation)
29May-23June: Mark up
24June-30Sept: Distribution
1Oct-15Oct: Break the ice

After a few days of liquid stage SM will initiate jump the creek if very few sellers at 47.5c. Your assumption of 2nd high consolidation around 47.5c - 55c is based on jump the creek in early April.

Pls correct me if i'm wrong.

Posted by SS661M > 2014-10-26 21:05 | Report Abuse

This is a world of give&take. I dun have much to offer & I dun know if u need it. The following is my humble opinion on FCF:

U'll find a few different formulas for FCFF&FCFE. They are just algebras. All can be simplified as:

FCFE = Net cash form operating activity - net capex
FCFF = FCFE + Finance cost*(1-tax rate)

When dealing with debt free company use FCFE. Discount rate is Re.
When dealing with company with significant debt use FCFF. Discount rate is Wacc.
When dealing with company with low debt like MMode can either use FCFE or FCFF. The results are more or less identical.

Cheers:))

Posted by yklip > 2014-10-28 09:38 | Report Abuse

Big movements. Any news happened to this counter?

Posted by SS661M > 2014-10-28 09:46 | Report Abuse

Read the post above. History repeat itself.

Posted by kentg03 > 2014-10-28 10:12 | Report Abuse

no yet ready my bullet, suddenly jump up

Posted by SS661M > 2014-10-28 14:51 | Report Abuse

I guess it has entered consolidation stage. Expecting another goreng up by SM next week.

Posted by SS661M > 2014-10-28 15:47 | Report Abuse

Hi, Pika. Like to ask you a question. If response from retailers are good, it is likely that consolidation stage reverts to mark up stage?