Michael Liang Now the shares is only 24sen.you don't buy now and when are u all going to buy.like REV last month 28sen and today is 40sen.do u all want to wait until 50sen then buy.many of the penny stock have up 100per cent already. ------------------ so if follow ur buy call then today need cut loss at 0.18 already
KUALA LUMPUR (Feb 20): YKGI Holdings Bhd saw its net loss widen to RM122.97 million or 35.07 sen per share in the fourth quarter ended Dec 31, 2018 (4QFY18) — an amount that is almost three times more than its market capitalisation of RM47.34 million.
KUCHING: YKGI Holdings Bhd, which owns manufacturing facilities in Sarawak and Sabah which produce metal roofing products, is expanding to Peninsular Malaysia.
The expansion plans for this downstream business in the peninsular, via wholly-owned subsidiary Asteel group, would be through joint ventures or acquisitions of existing metal roofing firms, according to executive deputy chairman Datuk Soh Thian Lai.
“The company has identified several potential ventures and is in the midst of evaluating its potential ventures,” he said.
Asteel has manufacturing plants in Kuching, Bintulu and Miri in Sarawak and Kota Kinabalu and Tawau in Sabah.
The other four plants manufacture roll-formed roofing and related products.
Lai said Asteel group had targeted to invest in two other production facilities in Sabah and open two more concept stores in Sarawak as part of the business expansion plans.“Asteel group also intends to expand its presence to Kalimantan,Indonesia,” he added.
The group currently operates seven “enviro” concept stores in Sarawak, Sabah and Selangor.These stores trade building materials and hardware.
This is a loss-making steel company for the past 5 years. There was some appeal in the stock last year due to the potential disposal of the company’s previous Klang plant. Initially, investors were expecting that the plant would be sold at near its asset value of around RM220mil (after deducting debt its net book value was almost RM80mil). But this did not materialised. The sale of the plant at only RM125mil to NS BlueScope represent a very steep discount to the value recorded in its balance sheet hence the reason for the massive losses in 4Q18.
Please take note that as of 4Q18 the company equity to shareholder was only RM44.5mil which is only 25.2% of the share paid up capital. If the company record another quarterly losses of more than RM2mil (which is most likely will be the case), it could potentially fall under the PN17 status. A company will be put under the PN17 status if the equity to shareholders falls below 25% of the paid up capital.
If you are looking to hedge your portfolio outside of YKGI (due to its weak earnings outlook and potentially falling into the PN17 status), I would recommend you to look at MBMR. (https://klse.i3investor.com/servlets/stk/pt/5983.jsp)
MBMR is a direct proxy to Perodua via its 22.6% interest in the company. Valuation is cheap at only 6.7x PE based on FY18 profit of RM166mil. PB is low at only 0.7x BV.
FY19 should deliver another profit growth year to the company. Profit growth will again be driven by the performance of Perodua (via MBMR 22.6% holdings in Perodua) from the still strong sales of new Myvi, sales of SUV Aruz and the introduction of the newly revamp Alza sometime in the 2H19. Aruz which commands a higher margin compared to other models, will help improve the total profit margin of Perodua (which will flow to MBMR’s bottom line as well).
MBMR is expected to achieve a profit of RM200mil in 2019. At the current share price, the company is being valued at only 5.5x which is a lot lower than the industry average of 15x PE. As an example, UMW (another company with exposure to Perodua) is currently trading at a PE multiple of almost 20x.
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....
Stock_god
2,808 posts
Posted by Stock_god > 2018-11-02 11:39 | Report Abuse
Michael Liang Now the shares is only 24sen.you don't buy now and when are u all going to buy.like REV last month 28sen and today is 40sen.do u all want to wait until 50sen then buy.many of the penny stock have up 100per cent already.
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so if follow ur buy call then today need cut loss at 0.18 already