Rich value if purchase recently. Try to purchase at RM0.310. Keep & hold tight. Fantastic returns on investment,in a matter of 1-2 years duration. If you observe the daily "parking prices & volumes", it signify Big Boys are accumulating this stock at dip
Siva: Don't invest on hope. Invest on calculated Risk & Reward Ratio. The lowest MBL-WA can decline is another 3-4 sens. If it reached the average price target specify by I3investor [MBL:RM1.40], then MBL-WA shall advance to RM0.67+- absolutely
Strong growth is unable to over-ride GE sentiment. As such the share price is heading SOUTH. Strong support at 0.80 sens. By then, MBL-WA will be well support at 0.20 sens, is it attractive to lure into buying??
Not going anywhere as the Palm oil industry is down and will be down further in second half of this year as more oil seeds plantings are being done in S. America as well as soy market is expected to be soft.
200-300k ha of palm oil planted per year in 2009 till now when the price is good will start to fruit after 3 years. So with all these newly maturing crop, what to do with it? Throw away or buy machine to process them? Your guess....:P
Got your point but there are many suppliers of machines and plants in the market, no need to go to this company. CAPEx spending when the plantation got money if not they send them to 3rd parties mills.
Yes 3rd year is new fruiting, approx yield will be between 8 ton per ha. 5th year will be about 15 tpha. 8 years is fully matured excess of 20 tpha.
The reasoning is once a crop is planted you need to process it even though the price is not so good.
Mbl is the leader in kernal crushing plant, not much competitor out there. Even if they send to external mill they still need new mills for new capacity right?
No matter where the fruit ends up, your own mill, 3rd party mill, your friends mill, your mom's mill, all of them will need new equipment to cater for the increasing amount of fruit coming out of harvest.
If not the mill not enough capacity to process, the fruit will 'rot' and not saleable...
There's always the demand for new palm oil processing machines for the following reasons: 1. Increasing harvest from the plantation 2. Replacement of aging and non-productive machines 3. Productivity improvement in the palm oil processing and value engineering practices
FY12 profit RM17.12m or 18.62 sen per share = PE 5.4. Dividend 10 sen single tier (yield of 9.8% and payout ratio of 53% of profit) Cash and cash equivalent of RM37.09m or 40.3 sen per share Low debt
The table below shows how much one earns a year with different measures for having MBL:
Year 2012 2011 2010 EPS, sen 0.186 0.133 0.078 FCF, sen 0.224 0.106 -0.058 Dividend+∂Book value, sen 0.236 0.165 0.077
How do you like a stock, at 1.03 now, earns 18.6 sen, or at a PE ratio of just 5.5. Besides the quality of earnings is high with free cash flow (FCF) at 22.4 sen a share.
A better measure of return could be the dividend received plus the change in book value of MBL at 23.6 sen per share, which is fantastic with the price of MBL at 1.03.
Not forgetting that MBL has been growing its revenue and earnings at very high rate of 46% and 26% a year respectively for the last three years. It has a net cash of 40 sen per share which would guarantee its high dividend payout for the future.
However Boiler has more business than MBL. It has a higher asset turnover and financial leverage than MBL, resulting in its higher ROE of 26.8% compared to 20.8% of MBL. Their return in invested capital are equally high at 35%, about 3 times above the cost of capital as shown in Table 2.
But which is a better investment? Table 3 below shows the market valuation in term of PE ratio:
Table 3: PE ratio comparison (figures in thousands) MBL BoilerMech Price $1.020 $1.240 No. shares 92000 258000 Market Cap. $93,840 $319,920 NI 17126 25058 PER 5.5 12.8
Boiler has more than 3 times the market capitalization of MBL and hence is more liquid. However, the PE ratio of 12.8 is more than twice more expensive than MBL. What about valuation in term of enterprise value?
Again it is clearly shown in Table 4 that in term of enterprise value over EBIT, Boiler is 3 times more expensive than MBL. So as their ROE and ROIC are quite close, but Boiler is three times more expensive, isn’t it clear which is a better investment, MBL or Boiler?
Jian, it's very common to invest in high yield strong balance sheet company, hopefully, this counter will maintain 10 sen or more single tier dividend every yr
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
masline
89 posts
Posted by masline > 2013-01-10 10:26 | Report Abuse
Rich value if purchase recently. Try to purchase at RM0.310. Keep & hold tight. Fantastic returns on investment,in a matter of 1-2 years duration. If you observe the daily "parking prices & volumes", it signify Big Boys are accumulating this stock at dip