Posted by Jjtrader > 2012-03-28 17:03 | Report Abuse

today support is good, closing up 4 cents. Hope tmr even better.

Posted by Jake > 2012-03-28 17:10 | Report Abuse

Don't hold your breath Jjtrader...

Posted by pureland > 2012-03-28 17:17 | Report Abuse

mcd123, not a surprise, it makes us feel refreshing when the market is dull...

Posted by Jjtrader > 2012-03-29 10:41 | Report Abuse

Today should be another force selling day, hope it will hold at 1.19

Posted by bomblikeme > 2012-03-29 11:19 | Report Abuse

Today will be forceselling day for JCY-CE as well, cos Friday list, many frenzy on it, so it might be a red day for CE ...

Posted by usry > 2012-03-29 15:52 | Report Abuse

hope it stable & not sliding further as last 2 weeks before.

Posted by Kent Lee > 2012-03-29 22:49 | Report Abuse

when can we expect Q2 to be out .... anyone pls?

Posted by Fat Cat Tim Buddy > 2012-03-29 23:09 | Report Abuse

any date in may, probably may 15 or above.

Posted by pureland > 2012-03-30 11:13 | Report Abuse

Hi lamken, cimb has a trading buy call on JCY today but with the following caution. Would the "expected" surge in share price be short lived? Appreciate your view on this. Thanks for sharing

"Expect favourable newsflow such as record
quarterly earnings from HDD OEMs. However, we
need to be watchful of the pricing environment
when JCY’s competitors are back to normal
production in 3Q12."

"Be watchful of HDD competitors’ recovery
Our discussions with some of the component makers (HDD-related and non-HDD related) that were affected by the flood in Thailand revealed that most of them should return to pre-flooding capacity in 3Q12. Only the small unlisted companies may face financial difficulties in restarting their operations. For instance, Nidec, the world’s largest HDD motor supplier, recently told investors that its base plate production (through the acquisition of SGX-listed Brilliant Manufacturing in 2006-07) is expected to return to pre-flooding capacity of 85m units/quarter in 1Q12 and further increase to 100m/quarter in 2Q12. Compart, Broadway subsidiary, is also expected to restart its Thailand APFA assembly production in 1Q12 and return to full production in 2Q12."

Posted by Kent Lee > 2012-03-30 14:20 | Report Abuse

TQ Fat Cat

Posted by usry > 2012-03-30 15:07 | Report Abuse

For me, i just wait & see coz we have 2 month from now to see the 2nd Quarter result..

Posted by diablo88 > 2012-03-30 19:17 | Report Abuse

this is a con job counter la. beware!

Posted by usry > 2012-03-30 22:23 | Report Abuse

diablo: what do u means for a'con job counter'.. Appreciated it if u can explain further..thanks for ur info.

Posted by diablo88 > 2012-03-30 23:28 | Report Abuse

if the fundamental of this stock is so good then it will not be the worst IPO performer and drop till 39cents or less. The price may not be sustainable and everyone is like wait and see attitude, watching the when the competitors is coming back.... When everyone else is not doing well, they are...No doubt they are making money now...what if suddenly the competitors wake up next week?

Posted by Fat Cat Tim Buddy > 2012-03-31 06:41 | Report Abuse

yes you are right, but i think if the competitor really come back, they will be 10 steps behind, and their factory still at thailand, i bet wd seagate will have to think twice before making any order.

Posted by usry > 2012-03-31 09:25 | Report Abuse

Agree with Diablo88. His oppinion sound relevent.thanks..
FCTB: ur idea also relevent..
conclusion: wait the situation b4 we act.. If this share price hoover aroud RM1.10 - RM1.20, it save for us to Hold..If down below RM1. than .....

Posted by diablo88 > 2012-03-31 10:05 | Report Abuse

if I were you I stay away from this counter. I rather place my bet on benalac.

Posted by usry > 2012-03-31 11:06 | Report Abuse

diablo: no pain, no gain..
a few research house says that this counter has a good expectation.and they also issued their Q1 report in a positive mode. so as a fundementalist, i think this counter will have a good faith.. by the way this is for me only and this reccomendation not related to those who is life or death..

Posted by Darren Kho > 2012-03-31 11:13 | Report Abuse

I prefer Benalec

Posted by lamken > 2012-03-31 13:17 | Report Abuse

pure: There are 2 issues which come to the heart of your question and only in undertanding these 2 issues will you have a better understanding of medium long term future for JCY earnings and its share price:

First, the issue around when competitors will be able to fully recover and normalise their production back to pre flood levels.

When we talk about competitors recovering, what we are really talking about is their ability to replace damaged machines with new machines, eg CNC machines. You need machines to produce. In order to acquire new machines (Capital Equipment) someone has to produce and supply those machines to you.There has been much talk about when competitors expect to resume normal production, but what determines when they can resume production will be based on when they can take delivery of all the new machines they need. The machines are not like a can of soft drink where the supplier holds a massive inventory on hand and is ready to ship them out if and when you need them. These machines are made to order and cost approx RM200k+ each and take time to build. And we are not talking about building/replacing 1 machine either. For instance, Eng tek needs to replace about RM40m worth of machines, this equates to approx 200+ machines. From my discussions with independent HDD industry resarchers trendfocus, there are only 2 specialised company's world wide who have the abilty to produce machines on these volumes while maintaining the strict quality standard the HDD makers require. One of these company's is based is Japan and the other in Germany, with Germany being the prefered choice amongst HDD component makers. Now you only need to look at the number of HDD component makers impacted worldwide to work out a rough figure of the total number of machines across all impacted companies which need replacing (thousands). So while JCY's competitors were waiting for waters to receed, cleaning up, waiting on insurance assesments to determine what needed replacing (insurance cover 50% of the costs) in Jan, it approved a 300m capex and placed
orders for over 1200 new machines. JCy are already ahead of the game in terms of new machine acquisition and the massive volume of machines they are buying/bought will only slow down the production and delivery time for their competitors to recive all their machines. Iam not discounting the fact that there
will be some competitors who may resume production earlier depending on how severely their machine count was impacted but the ones who were severely impacted and require large volumes
of machines to be replaced will take alot longer to come back to normal production levels. If you speak to any JCY competitors (indeed of the research houses have), they are going to tell you they expect normal production by X quarter/date. But the fact of the matter is their expectation is going to always be much earlier then reality because they need to give the market the perception that they will be back to BAU (business as usual) earlier as this will affect their ability to secure future sales and also affect their share price. So my point is that In looking at when JCY competitors can resume normal production levels, we need to look at the total number of new machine orders Vs how many machine suppliers there are in world who can supply the req machines and at what rate the machines can be produced and the reality is that the resumption of normal production levels will occur much later then what each JCy competitor "expects" (those that were severely impacted).
The HDD and component companies are working feverishly to move production either to non-flooded areas in Thailand or transfer production out of Thailand, but as you can imagine this can take some time. For example I have been told that (assuming after the machines are delivered) it takes 13-17 weeks to bring a slider fab line (making the magnetic recording heads for the HDDs) back on line.

Posted by lamken > 2012-03-31 13:19 | Report Abuse

The second issue correlates with the first, in terms of HDD pricing. How slowly/quickly HDD prices go down over time will depend on when the whole industry recovers and when the balance of supply and demand finds its equibilrium again. We already know the HDD shortage will remain into 2013( Seagate CEO Steve Luczo). So there is no doubt HDD prices will "gradually" return back to pre flood levels over time when the whole industry normalises but the question is how gradual and at what pace. The answer will be based on when the point above relating to the acquisition of new machines. We know that HDD makers like
Seagate have entered into LTA (long term agreements) essentially locking in prices for "multiple years" (Seagate CEO Steve Luczo). So in the short/medium term at least there should be
some stabilty in terms of pricing. The other consideration which might have an impact on HDD pricing in the long term is the pay back period on the acquisition of new machines (for both HDD makers and component makers) severely impacted by the floods). Can they afford to charge pre-flood prices after production resumes at a normalised rate after incurring such big costs (tens of millions) on the acquisition of new machines?
I do not think so as this could extend the pay back period on the new machines for possibly years.


While there has been much discussion on long term pricing and its possible impact on the whole HDD industry as a whole in including JCY,one important fundamental has been ignored. That is market share and the volume of allocations/sales. Has JCY captured new market share and and has its allocations increased? I think the answer is quite obvious especially when the company is spending a capex of 300m to increase production by 40%. HDD prices may gradually go down as competiors normalise their production, but JCY's market share has also increased as a result of the floods. Its earnings is not going to collapse overnight just because its competitors resume a normal rate of production. So this beckons the next question, will HDD makers like WD and Seagate be sitting around for possibly 10 months+ (from the time of the floods) for JCY competitors to normalise their production and hand orders back to them, especially if their factories have not been relocated to higher ground or moved out of thaliand completely? And will big HDD makers like WD/Seagate have the confidence to hand orders back to JCY competitors if they do not relocate their factories (which is again going to delay the time for production to normalise to pre-flood levels). If JCY competitors move their facotry to another country, they face a very big problem, that is human resources. It takes time to recruit/hire/relocate a large workforce to another country. This is especially true in Malaysia
where government approval is required for companies wishing to bring in X amount of workers. JCY again had time to prepare and has already been granted govt approval for over 4000 workers in malaysia to bolster its workforce. If JCY competitors intend to move their factory to malaysia, they are going to have a hard time finding workers. There are of course other countries like China, philipines etc but you cannot escape the time lost in relocating and hiring a new workforce.


So in conclusion, Are JCY competitors going to wake up and normalise their production levels by next week , absolutely not and its is going to take longer then what JCY competitors
are "expecting". Will there be a sharp dip in HDD pricing next week, absolutely not-the price will gradually go down afer the whole HDD industry normalises and even then it will take further
time for prices to return to pre-flood levels due to the pay back period on the acquisition of new machines by those impacted by floods. Will JCY's earnings collapse when the whole inductry normalises and prices return to pre-flood levels- absolutely not because it has also captured additional market share, evidenced by the need to increase production levels by 40% to cater for
increased customer demand. Any loss in revenue as a result of lower prices in the long run will be offset by increased market share, ie increased allocations/volumes.

Finally, remember that JCY's earnings were already starting to turnaround before the floods. In Q4 2011 (before the floods) JCY recorded approximately RM24m profit as opposed
to a loss in the quarter before that. It has also stated that for its Q1 2012 results, 50% of it was due to the benefits as a result of the flood. This means that of the 164m profit for Q1 2011, 82m was none flooded related which means they would have earned this 82m regardless of the floods. Any gradual drop in HDD prices over the long term is going to be offset by the increase in market share captured by JCY.

Posted by lamken > 2012-03-31 13:21 | Report Abuse

diablo88: There are many factors which can affect the share price other then its previous fundamental. ie overvaluation on IPO listing, the GFC which resulted in reduce demand from
major HDD makers like Seagate/WD. just becuase its share price went from IPO 1.60 to a low of .39 at one stage has absolutely no bearing on the current/future state of play, ie the current/future operating enviroment, the current/future business model, and the current/future state of the HDD industry as a whole.

Posted by John Wong Jun Yuan > 2012-03-31 14:34 | Report Abuse

thanks for MR.kenny explaination. I am an account background student and I understand what you talking about. This is also my personal opinion, so once the share price drop I average down the price. But I am not so professional as you. So I wish I can continue learn from you in the future.

Last sunday, I heard my uncle say the JCY GM is his friend. He say his SG BOSS of JCY will want to "goreng" the JCY price in the coming period(dun noe when). And the tebrau JCY GM has take a personal loan to buy the shares. I do not know whether this new is true or not. I just share with fellow here.

Btw, I am a long term investor, so I am not interested in those" goreng" news at all. Happy trading~~

And I help Mr. Kenny mentions one more time, although he is sharing his professional view and information, but all of us still trade at our own risk. His sharing is appreciated but the price of the market may very hard to be predicted. Any loss incurred cannot blame anyone. However, if you r a long term investor, Mr.Kenny's info will be very useful for you.

I am a newbie, I hope what I said here will not displease anyone.

Posted by usry > 2012-03-31 15:14 | Report Abuse

Agree with JWJY and for me as fundemental,i also don't borther about 'goreng menoreng'.. what i wait is 2nd Quater result than the market will determine it price. How ever the external factor such as market sentiment & politic and economy condition also will influence ths stock price.How ever this is not a recommendation as i'm also a newbie and buy or sell is at our own risk..

Posted by Rose Eu > 2012-03-31 20:07 | Report Abuse

Tq Lamken for yr explanation, now I feel comfortable holding jcy for medium term.

Posted by pureland > 2012-04-01 00:37 | Report Abuse

Lamken, appreciate your insights. Also read thru your discussions with cherroy. Really helped in understanding the rationale behind your buy call.

Fully agreed with John that we are responsible for our own investment decisions. But your clarity in explanation has definitely made a difference. Thanks a lot for sharing.

Posted by tasoke > 2012-04-01 01:57 | Report Abuse

Y this counter nearly 2 mth no more research house predict JCY? YYY/???

Posted by verylovely > 2012-04-01 20:32 | Report Abuse

Research houses usually will give buy recommendation only after they had placed their position nicely, to gain maximum profits.

Posted by verylovely > 2012-04-01 20:34 | Report Abuse

After that, they will keep on revise the target price to a higher level.

Posted by anipchin > 2012-04-02 00:25 | Report Abuse

Perhaps what verylovely said is true.

Posted by anipchin > 2012-04-02 00:27 | Report Abuse

Mr. Lamken, thanks for your detail explaination. Really appreciated that.

Posted by kw23 > 2012-04-02 09:55 | Report Abuse

start to up up up

Posted by Peter Lee > 2012-04-02 11:31 | Report Abuse

you are great mr john

Posted by Jjtrader > 2012-04-02 12:47 | Report Abuse

Selling pressure is still high, today no chance to go up further. Consolidating, hopefully next week will go up further to break the 1 st strong resistance at RM 1.26.

Posted by fcsavana > 2012-04-02 12:53 | Report Abuse

Haloo Taiko.

Can i buy JCY at this price rm 1.19 t0 rm1.20 now? as I noted that it is rebound from a short term downtrend.

Thanks..

Posted by Jjtrader > 2012-04-02 13:39 | Report Abuse

Flag formation likely, if break support RM 1.13 cut lost. If break RM 1.23 only will continue up tread. Just my opinion.

Posted by fcsavana > 2012-04-02 15:21 | Report Abuse

Thanks Bro Jjtrader..I shall hold,wait and see now.

Posted by diablo88 > 2012-04-03 01:07 | Report Abuse

lamken: appreciate the insight. really thumbs up for you to write such a detail explaination. I buy into your view on jcy.

Posted by LittleY > 2012-04-03 17:21 | Report Abuse

New Warrant for JCY (JCY-CF)

Issuer : AmBank
Issue Size : Up to 100,000,000 JCY CW
Exercise Ratio : 2:1
Exercise Price : RM1.22
Issue Price : RM0.150
Issue Date : 3 April 2012
Listing Date : 4 April 2012
Expiry Date : 28 February 2013

Posted by tasoke > 2012-04-03 17:22 | Report Abuse

call warant issued again, too many of call warants issued in the market.

Posted by Jjtrader > 2012-04-03 18:10 | Report Abuse

What is the effect of too many call warrant toward mother shares ???

Posted by chongkonghui > 2012-04-03 18:23 | Report Abuse

Great sharing from lamken.

I can confirm that a CNC machine really takes time to order, not to mention 300~400 units.

As to New Warrant, really wonder why it was issued. Can someone share?

Posted by charlie chia > 2012-04-03 18:50 | Report Abuse

Prospect for JCY must be good for them to issue call warrants

Posted by tasoke > 2012-04-03 19:06 | Report Abuse

big player when time to issued call warrant, they push up the price, when time to expire they pull down d price, not fair value at all, market gila.

Posted by verylovely > 2012-04-03 19:07 | Report Abuse

Call Warrants are issued when the bankers see growth opportunity of the mother share during the exercise period. OSK and AmBank will not just aiming for that RM0.15 or RM0.30 (2:1) from CWs. The profit margin will be much higher when JCY is appreciating. The bankers have a group of so-called expert employees to calculate the better way of making money, according to various market situations.

Posted by verylovely > 2012-04-03 20:59 | Report Abuse

May '12 is financial report month again. JCY will report performance about 1 month 1 week from now. Perhaps this share price going up during this period. Those financial houses with positive views on JCY should have position themselves nicely in last 2 months. Hopefully can grow together with all current JCY shareholders.

Posted by andy118 > 2012-04-03 22:15 | Report Abuse

I believe that when the issuer (OSK & Ambank etc) issues the call warrant, it is good for the counter because :- (1) they would have hedged the share say in this case collecting them at say RM1.10.
(a) if share price of JCY on expiry date is 80sen, then profit is nil (RM1.10 - 80sen - 15sen x 2). Anything above this amount is all pure profit up to RM1.22. If price is RM1.22 or above profit is 42 sen per share. (2 x 15sen + share profit) as they do not have to pay out anything or sell the above shares and give the money to you if it is above RM1.22. So I see no reason they have to press down the price 5 days before expiration date as it make no difference to them. In fact if the price is below 80 sen then they lose money.
(b) having bought the shares, the supply is reduced so it is good for the share price. (remember supply goes down, price goes up)
(c) usually they will issue cw where the company can pay dividend as these dividends goes to them and not to the cw holders (I think only)
(d) must be stable or growth companies because if the share price goes below 80 sen in this case, they lose money. Just my 2 sen worth of thought. Correct me if I am wrong. Thanks in advance.

Posted by andy118 > 2012-04-03 22:18 | Report Abuse

Ah maybe they press the price down so that they don't have to pay out anything and when the price goes back to normal after expiration date they then sell it on the open market.

Posted by Jjtrader > 2012-04-03 23:52 | Report Abuse

Why everybody say JCY is good but the price still never go up ? Why Why Why ?????

Posted by njue76 > 2012-04-03 23:54 | Report Abuse

it;s time,,,,