@saumei because it has good financial health and earn more than enough to give dividend every year so in a long run, it is profitable to stay on this counter.
Know something. The last time they gave bonus issue 1:4 was way back in 2004. They have sufficient reserves to afford a bonus issue this time. Hope it will materialize.
CHINWEL gained 6.0 sen (3.2%) to close at its 52-week high of RM1.93. As a result of the strong move, the share price formed a “white-Marubozu” candlestick which indicates that the bulls dominated the day right from opening bell till market close. The move may possibly signal a resumption of the previous 3-month uptrend, which took a breather in early July. Yesterday’s decisive breakout was supported by strong volume with 2.4m shares traded. Further up, some resistance is expected overhead at RM1.95 (R1) although breaking beyond that, the next resistance is located at key psychological level of RM2.00 (R2). Any weakness back to the RM1.80 (S1) support levels may be viewed as a buying opportunity, failing which RM1.77 (S2) should offer additional support.
Chinwell is still holding on strong despite the report that it may earn less profit this quarter. Agree with optimus919 Tongher is another good counter but the share price has since rocketed from RM2 early this year to RM3.75.
I think the announcement of a lower quarterly profit is now a non issue. Looking at today's trading the counter may even close higher than the price prior to the announcement. The company is solid and steadfast with current ratio (liquidity) at 5.5 times, and ample cash in bank to cover borrowings by about 3 times and it's gross profit is 18.5% (considered excellent).
Chinwell reported a lower cumulative profit-before tax of RM51.03 million recorded in the 3rd quarter of the financial year ending 30 June 2017 compared to RM56.81 million for the corresponding period of previous financial year.
The shortage of steel-based raw materials such as hot-rolled and cold-rolled coils will fuel Chin Well Holdings Bhd’s growth in the financial year ending June 30, 2018 (FY18).
Group executive director Tsai Chia-ling told StarBiz that due to the Urban China Blue Sky project, the output of the steel-based product manufacturers would be reduced.
“The affected are those equipped with old production processes, which are unable to cut carbon emissions to meet the requirements of the Urban Blue Sky Project.
“The market has been experiencing a shortage of steel-based raw materials for the past three months, which is expected to worsen by year-end.
“We expect the bulk of the orders for fasteners to come in late-2017,” she added.
PROSPECT : The market outlook for the Group is expected to remains challenging in the next financial year. The main factors that may affect the Group's performance will be the trend of the market demand in addition to the volatility of the raw material price. The unexpected market movement and rapid changes in the raw material cost will affect the production volume, product cost and bottom line of the Group. In order to cushion the stress from the safeguard duty which imposed by the Malaysian government towards the end of the financial year on the wire rod imported from China, the Group had sourced its raw material from other alternative countries such as the Middle East and Vietnam which are duty exempted and without compromising the quality of our products. Application to the authorities for the exemption of the duty is in the progress with the hope to obtain the approval in the next financial year. In addition to the existing core business, from time to time, the Group will explore into other new business ventures which will potentially benefit to the growth of the Group. Barring any unforeseen circumstances, the Group anticipates satisfactory performance in the next financial year
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