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Author: kcchongnz   |   Latest post: Sun, 11 Jun 2017, 11:58 AM

 

Business Sense in FGVB: How to spot a lemon kcchongnz

Author: kcchongnz   |  Publish date: Sun, 11 Jun 2017, 11:58 AM


In these few days, there are numerous articles in the newspapers, the business magazines about Felda Global Venture Berhad (FGVB). That is the hottest topic now in the mainstream media, hands down.

Why such a fuss? Can’t you see it many years ago?

Yes, one would have seen it years ago if he just uses some business sense. For your information, business sense is part of fundamental analysis, or commonly termed as FA.

Where got such thing as FA practitioners do not look at business? What business is it in, how it makes money, does it make more than its cost of capitals, is there cash flow, is it risky because owing a lot of money, etc., etc. FA practitioner invest in a stock as akin to invest in part of a business.

More importantly, using FA can avoid investing in lemons which can cause immense damage to one’s financial wellbeing. Below is just one of the scores of lemons to avoid that I had shared in i3investor over these few years.

 

I wrote an article on FGVB two and a half years ago in i3investor in the link below, and hence it is not just a 马后炮,

http://klse.i3investor.com/blogs/kcchongnz/66355.jsp

That was my true response three years ago in June 2014 to someone who asked my opinion of his intention to invest big time in FGVB with various reasons given by him as mentioned in the article.

Using FA and some simplistic business sense, I gave my very strong opinion against it when FGVB was trading at RM4.14 then.

My rationales were FGVB had a lot of plantation with old palms and they would require a lot of capital expenses in the near future. The return on capital was very low at just 4%, even taking huge amount of one-time-off gains into its earnings. Making a return much lower than the cost of capital is a huge shareholder value destroyer. It has had a messy balance sheet with many related parties’ transactions. With huge amount of cash available then with the IPO billions of Ringgit, and with all the political undertone, it wasn’t difficult to see from the crystal ball that huge leakage would result.

I would never agree that big, in FGVB’s case, is good, but the contrary.

Its price at a PE ratio of 15 then, with the huge one-time-off illusion gains was not cheap.

My strongest objection in investing in FGVB is as mentioned in my previous article as summarized below:

But I won’t touch FGVB more of its corporate governance. Those at the helm appear to be all political appointments; especially the person at the very top has not shown any credibility in the past. These people were so used to handling the money and affair of the corporation as if it is their own. They talked about how they are going to build the company 8 folds to a 100 billion company. It is basically their quest of empire building all over the world. They want FGVB to be the biggest growth story in corporate Malaysia. It has shown that very rarely a company can be successful in enhancing shareholder value by acquisition trail. They will acquire businesses very different from their core business and beyond their competence level, often with high costs and associated leakages.”

This was not the only company I shared in i3investor on how to avoid lemons using FA, and of course, business sense. There were scores of companies I have shared in i3investor. For the record, I was seldom wrong in my assessment on lemons.

If one can avoid the lemons in investing, more than half the battle in this probability game of investing has already been won.

Business sense is not just some storytelling, mumbo jumbo, and changed whenever one feels like to suit his interest. It must be supported by the foundation, some numbers. Otherwise where is the business sense come from?

Why is that there are so many out there who keep on harping that FA practitioners have no business sense?

Well, maybe that is precisely why FA worked, and still works very well in investing now, and in the future.

Labels: FGV
  14 people like this.
 
kcchongnz Posted by stockmanmy > Jun 11, 2017 10:01 PM | Report Abuse
kc
no business sense.....you cannot make money from stock market....probably cannot even do business......just stick to math teacher.

Tell me exactly what is your so-called business sense in Jaks.

My maths, and accounting too,is definitely miles ahead of you, even though you are an "accountant", and I am not. No argument about that.

I cannot make money in the stock market? How you know? haven't you read all the articles dedicated to you how the return of my portfolios like as established in the last four years in i3investor?

Have you got any established record or not to show that you made that much money? Please show!
11/06/2017 22:09
kcchongnz Posted by stockmanmy > Jun 11, 2017 09:45 PM | Report Abuse
argue no point, kc
if you try to convince people that for a $ 2 billion IPP, the cashflow projections shows no money to make....provided the project is completed on time and according to schedule........no one will believe you.
the truth is...it is very profitable.

How much was Mudajaya's power plant project in India? How much did they make?

"Provide the project is completed on time and according to schedule"

Completed already ah? On schedule ah? When did Jaks first got the project?

"profitable"? How profitable?

Actually you still have no idea what the issue we are talking about.

It is about if that is so great with an IRR of 12% with all the risks.
11/06/2017 22:14
stockmanmy ks


promise me you will jump down when Jaks cross $ 2 and Sendai cross $ 1.50?
11/06/2017 22:23
stockmanmy Vietnam is not India
Jaks is not Mudajaya

now...that is definitely business sense, not maths.
11/06/2017 22:28
kcchongnz But one thing I can say speculating in Jaks, not investing, may make you money. That is when the naive are brought to buy the notion that accounting profit is something "real" when Jaks books in its construction "profit", taking it from left pocket to right pocket, and back to left pocket again.

This is a likely scenario.

But please don't brag about business sense. It is a speculative sense.

In fact, many have already made profit following the story, and money, when it was less than RM1 just a few months ago. No argument about that.

One does money money that way.

But in the future, hard to tell.
11/06/2017 22:32
kcchongnz Posted by stockmanmy > Jun 11, 2017 10:28 PM | Report Abuse
Vietnam is not India
Jaks is not Mudajaya
now...that is definitely business sense, not maths.

Doing business doesn't have less problem than India.

Mudajaya,in its hay days, is much much more established and capable than Jaks. Haven't you heard of how many power plants have Mudajaya build? No doubt about it. How many power plants has Jaks built? Jaks can't even smell its fart.

When Mudajaya started its power plant construction, it made huge profit too.
11/06/2017 22:37
paperplane2016 Jaks did it badly in almost everything they did
11/06/2017 22:38
stockmanmy the best part is Jaks just sit back and collect money.

let their partner who has done more power plants than anyone else in the world bring in the cash.......


great business model, great business sense.
11/06/2017 22:45
stockmanmy Jaks $ 2 is less than 6 months away.
11/06/2017 22:48
kcchongnz Posted by stockmanmy > Jun 11, 2017 10:45 PM | Report Abuse
the best part is Jaks just sit back and collect money.
let their partner who has done more power plants than anyone else in the world bring in the cash.......
great business model, great business sense.

Oh, Alibaba.

So if the power plant time and cost overrun, the Chinese partner will still pay what was estimated as Jaks profit and cash flows?

So if there is a financial crisis and banks do not lend money any more, the Chinese partner will still pay what was estimated as Jaks profit and cash flows?

So if the Dong falls or inflation spikes, the Chinese partner will still pay what was estimated as Jaks profit and cash flows the same $?

So if the Vietnamese officials demand for more mmoney, the Chinese partner will pay all the extra but still pay what was estimated as Jaks profit and cash flows?

etc.

Great Alibaba
11/06/2017 22:53
shortinvestor77 xingquan shows big failure of KYY. It will be more failure. Open big eyes to see.
11/06/2017 23:13
stockmanmy people no business sense, argue no point ....time will tell.

but Jaks and Sendai, will surely perform.
11/06/2017 23:57
cheated Why KC dare not talk in ctr thread? Why he only talk in his blog?
12/06/2017 00:03
cheated Can trust KSL, J Tiasa? Why never pay dividend? Creative acctg or director eat all the money?
12/06/2017 00:08
cheated Latest U ranking out. USM far worse than UM.
12/06/2017 00:09
stockraider People still trying very hard to discredit KC bcos they feared kc is a threat to their intended share manipulation loh...!!

Yes...an educated investors with good fa insight would have spotted Jaks is a lemon in the making loh...!!

Learn from fgv....u can see similiarity to jaks loh...!!
A company....which only can talk only future promise....with no fa performance....do not deserve ur attention or investment loh..!!
Don make the mistake of the past loh...!!
U must value the company using FA to decide whether got margin of safety mah....!!

Remember business sense & financial sense are together n complement each other loh...!!
Financial sense must be right then business sense or business sense is right then financial sense loh...!!

Remember a sound & sustainable investment u must both settle for both financial and business sense b4 it qualify loh...!!

Not just shouting business sense...business sense without financial sense, like some jokers are doing loh...!!
12/06/2017 09:31
stockraider People still trying very hard to discredit KC bcos they feared kc is a threat to their intended share manipulation loh...!!

Yes...an educated investors with good fa insight would have spotted Jaks is a lemon in the making loh...!!

Learn from fgv....u can see similiarity to jaks loh...!!
A company....which only can talk only future promise....with no fa performance....do not deserve ur attention or investment loh..!!
Don make the mistake of the past loh...!!
U must value the company using FA to decide whether got margin of safety mah....!!

Remember business sense & financial sense are together n complement each other loh...!!
Financial sense must be right then business sense or business sense is right then financial sense loh...!!

Remember a sound & sustainable investment u must both settle for both financial and business sense b4 it qualify loh...!!

Not just shouting business sense...business sense without financial sense, like some jokers are doing loh...!!
12/06/2017 09:32
CharlesT Posted by stockmanmy > Jun 11, 2017 11:57 PM | Report Abuse

people no business sense, argue no point ....time will tell.

but Jaks and Sendai, will surely perform.

The one with super biz sense bought Xinquan all the way from Rm1 to RM0.03 till the stock suspended and faced total loss
12/06/2017 09:34
Hua Joshuaayoung In Bursa, mgmt is much important than market sense. to buy in govt. link stocks must be very be careful... and freaking china stocks. !!
12/06/2017 15:24
Jay reading the article and comments trigger some thoughts

1. most of those who kept talking about biz sense has no idea what it means. if all business owners have biz sense we wouldn't see so many loss-making companies in Bursa. as investors have limited info and access to mgmt, the tried and tested way to gauge a management's quality is still through their qualification and track record.

2.investing (FA) vs trading (TA) has existed as long as investing has been around. I have seen practitioners of both disciplines done well so I'm not against either approach but one should not mistake one for another. kc is clearly talking about FA here but many others keep talking TA with "biz sense" as disguise.

3.many still cannot differentiate between investing/trading or stock price vs value. Some companies are suitable for long term investing while some just for short term trading. and rubbish companies don't turn good just bcos the share price went up, vice versa.

4. if you trade on a rubbish stock which price went up and you exit with a profit, congrats as you time the market right this round. repeat the trading enough times without clear risk reward management plan, you would soon join the herd who keep complaining that stock market is just a lie that cheat people's hard earned money

5. the most difficult thing about stock returns is not about how high % return, but consistency. why warren buffett is regarded as the greatest investor when he only generates slightly above 20% return a year? many in any investing competition would have beaten buffett hands down this year but can they repeat this return over 50+ years? gaining 50% a year and losing 50% the next year actually gives you 25% loss whereas someone who makes 10% a year would have made 21% return

in summary, kc is trying to teach the youngsters nowadays about long term fundamental investing principles but most are just interested in making a quick buck in the next week or month.

to kc, I share your experience. sometimes pointing out a lemon does makes lemon owners irritated. but as long as someone learns something or save him/herself from that lemon after reading your article, that would make it worthwhile. cheers
12/06/2017 21:47
VenFx Even Robert Kuek the most respectable Chinese Tycoon also pay huge losses from Dr. M's proxy Ling who was as the Transmile Board members.

Wondering if Kc did do a cover for this Lemon ?
Hooe to learn something from that article if any.
12/06/2017 21:50
Frank Soweto Very well said jay. This year especially many 'Siifus ' made very good returns due to the bullish mart whether it's business sense, dynamite sense,goreng sense,tikaming sense etc so bound to see some 'sifus ' shouting on their returns n most of these siiputs when mart turns bearish will be no where to be seen for sure lol.
Kc has been very good at spotting longkang shares n sharing with us here for many years - one of them most famous was and still is General's KNM n till today at the all time low some braveheart still delusionally hoping for miracle despite many years of General Lee's antics.
Some jokers also making fun of his ' meager' return of 20+% in 6 months lol - honestly I'll be very happy to make 10% every year lol. Yep the key word is consistency.
13/06/2017 03:41
king36 I agree w u. KC sifu taught me a lot through his threads. TQ KC.
TQ JAY - for your explanations above - good to take those remarks. Please do come in more often.

Jay ...in summary, kc is trying to teach the youngsters nowadays about long term fundamental investing principles but most are just interested in making a quick buck in the next week or month.

to kc, I share your experience. sometimes pointing out a lemon does makes lemon owners irritated. but as long as someone learns something or save him/herself from that lemon after reading your article, that would make it worthwhile. cheers
13/06/2017 05:18
CKCS STILL THIS STOCKRAIDER COCK-TALKER DARE TO CONTINUE HIS SMALL COCK STORIES PREACHING? ALREADY LOSE 9 MILES IN EVERGREEN.
13/06/2017 10:02
stockmanmy business sense means buy Jaks and buy Sendai................
re recent troubles with Saudi


we must understand Qatar is a creditor country, politically stable, little trade with its neigbors, main income from selling gas to Far East, Euro.

and Sendai can get more jobs as a percentage.
13/06/2017 12:35
stockmanmy business sense means buy Sendai....new high on new troubles is sure buy.
13/06/2017 12:36
kcchongnz Posted by stockmanmy > Jun 13, 2017 12:35 PM | Report Abuse
business sense means buy Jaks and buy Sendai................
re recent troubles with Saudi
we must understand Qatar is a creditor country, politically stable, little trade with its neigbors, main income from selling gas to Far East, Euro.
and Sendai can get more jobs as a percentage.


Oh, that is "business sense"!
Must have "recent trouble"!
Must have "little trade with neighbors"
Main income must be "selling gas"

But why "Sendai can get more jobs as a percentage.?

A great "business sense", from an 'accountant".
A great "dynamite" investor,
A great "panic moment"

What a great education on "Business sense"!

Keep it up, "Accountant"!
13/06/2017 14:26
stockmanmy kc

business sense is the ability to handle risk. Maths teacher cannot handle risk, better buy FD.

business sense knows why the bet, what is the bet, the odds, the rewards, the risk...maths teacher is like tikus, comes with the territory. ...but please don't buy Fibon.....there is no way to assess the risk of a listed company that only generates $1 million revenue a month...and don't even have any unique selling propositions.

84 years old maverick don't drive Rolls Royce because he is merely lucky, it lasted for decades, there is more than luck factor here.

There is some thing for ambitious young men to learn here.
13/06/2017 14:45
kcchongnz Posted by stockmanmy > Jun 13, 2017 02:45 PM | Report Abuse

kc

business sense is the ability to handle risk. Maths teacher cannot handle risk, better buy FD.

ME: FIRST THING, ONE MUST KNOW WHAT RISKS ARE, RECOGNIZE RISK FIRST, UNDERSTAND IT, MINIMIZE IT, HANDLE IT OR AVOID IT. DO YOU HAVE ANY IDEA AT ALL WHAT RISKS ARE ENTAILED IN SENDAI AND JAKS?

I SAY YOU CANNOT EVEN UNDERSTAND WHAT RISKS IS IN INVESTING.

business sense knows why the bet, what is the bet, the odds, the rewards, the risk...maths teacher is like tikus, comes with the territory. ...but please don't buy Fibon.....there is no way to assess the risk of a listed company that only generates $1 million revenue a month...and don't even have any unique selling propositions.

ME: TELL US IN CLEAR EXPLANATION; WHY THE BET? WHAT IS THE BET? WHAT ARE THE ODDS AND REWARDS, WHAT THE RISKS ARE ECT. IN YOUR BETS?

DON'T JUST SAY SOME VERY VAGUE THINGY.

84 years old maverick don't drive Rolls Royce because he is merely lucky, it lasted for decades, there is more than luck factor here.

ME: OH, YOUR "BUSINESS SENSE" IS JUST PLP, AND NOTHING ELSE.I BET YOU HAVE NOT THE FAINTEST IDEA WHAT OTHER HAD GONE THROUGH.

WHAT A GREAT RUNNER WITH THIS 'BUSINESS SENSE"?

There is some thing for ambitious young men to learn here.

ME: HA HA HA HA. I SAY, YOUNG MEN WHO WISH TO HAVE A GOOD OUTCOME FINANCIALLY IN LIFE, AVOID THIS "BUSINESS SENSE' FROM THIS SNAKE OIL SALESMAN, AT ALL COST.
13/06/2017 15:02
stockmanmy kc

Jaks from $ 1.00 now, $ 1.50...
Sendai from 50 sen , now $ 1.08

ok...that is the past...

when Jaks crosses $ 2.00
Sendai crosses $1.50.......you retire? stop misleading ambitious young people?
13/06/2017 15:06
Alphabeta AmCham is an independent association of companies with the objective of promoting trade and investment between Vietnam and the U.S. With two chapters, one in Ho Chi Minh City and one in Hanoi, our membership of 700 companies and 1,500 representatives is unified by a commitment to promote trade and investment between Vietnam and the United States.

http://www.amchamvietnam.com/2017-update-on-foreign-mega-investment-projects-in-vietnam/

Items 10, 13, 17 & 21 are related to Thermal Power Plants in Vietnam.

(Jaks is the most expensive among the pack for in term of capacity, risk of delay and cost escalation from the initial announced investment are common). Good Luck to business sense.

10) $2.26 billion Jaks Hai Duong thermal power plant

The 25-year BOT 2×600 MW project by Malaysian company Jaks Resources Bhd. was licensed in 2011. Preliminary construction work on the project has already started, with the land clearance and boundary walls completed.

In July 2015, Jaks Resources Bhd. inked agreements with China Power Engineering Consulting Group Co., Ltd. to jointly develop the plant through a 50:50 joint venture.

The project’s construction was kicked off in March 27, 2016. Since then, there was no progress. By the end of 2016, the Hai Duong People’s Committee was trying to find ways to urge the developer to continue with the project but there is no new development as of now.


13) $2.018 billion Vinh Tan 1 Thermal Power Plant in Binh Thuan

Licensed in 2013, the BOT plant is an investment of a consortium of two Chinese companies and Vietnam National Coal-Mineral Industries Holding Corporation Ltd. (Vinacomin). The plant is part of Vinh Tan Thermal Power Complex, which consists of four projects with a total capacity of 5,600 MW. This is the country’s largest coal-fired thermal power plant.

While Vinh Tan 1, 3, and 4 remain under construction, Vinh Tan thermal plant 2 has started operation in January 2014.

The operation of the plant sparked strong opposition from residents in the surrounding area on account of potential pollution hazards. Due to strong coastal winds, Vinh Tan Thermal Plant 2 is obscured by fumes and dust, despite efforts to regularly irrigate the area, as required by local authorities.
In April last year, thousands of people blockaded National Highway No. 1A, stopping traffic for hours to complain about coal dust and cinder from the power complex, especially the newly built Vinh Tan No 2.

The Binh Thuan People’s Committee urged the power complex management board to stop all executive work when wind speed reaches above level 8 (88 km per hour).
At the end of 2016, Binh Thuan authorities stopped Vinh Tan 1 from pouring 1.5 million cubic metres of waste into the sea. As of January 2017, people living nearby still complained about the coal dust and cinder from the plant whenever wind blows heavily.

http://www.sourcewatch.org/index.php/Vinh_Tan_power_station

17) $2.018 billion Duyen Hai 2 thermal power plant in Tra Vinh

Licensed in 2015 by Malaysian Janakuasa (Malaysia), the Duyen Hai 2 thermal power project is going to be built in a BOT format.

The project has two turbines with a total capacity of 1,200 MW. Construction is going to start in the second quarter of 2016.

The plant, which is expected to go on stream before 2020, will be one of the four thermal power plants in Duyen Hai Power Centre. The remaining plants, representing a $6 billion investment by Electricity of Vietnam Group (EVN), are Duyen Hai 1, Duyen Hai 3, and Duyen Hai 3 extension.

Once completed, the power centre will contribute to the national power grid an additional capacity of 30 billion kWh annually.

On August 3, 2016, the Malaysian investor broke ground for this project.

21) $2 billion Nghi Son 2 Thermal Power project in Thanh Hoa

Nghi Son 2 was the first international tender for a large-scale coal-fired power plant in Vietnam. The project is going to be carried out under the build-operate-transfer (BOT) format. The $2-billion plant will be located in the province’s Nghi Son Economic Zone. It will have a capacity of 1,200 MW, produced by two 600 MW units.

In November 2016, the consortium of Japanese company Marubeni Corporation and Korea Electric Power Corporation (Kepco) signed with the Ministry of Industry and Trade the investment agreement for the project.

As of the end of 2016, the consortium was awaiting the investment certificate and was arranging the finances for the project. Though the ground-breaking ceremony was held in September 2015, the project has yet to secure a range of agreements to complete the BOT contract package.

http://www.sourcewatch.org/index.php/Cong_Thanh_power_station
13/06/2017 15:10
stockmanmy Firstly...it is a US$ 1.87 1.2GW project....making it the lowest among the approved IPP project.


This is a 30%/70% JV (US$ 1.87 billion project) between Jaks and China Power Engineering Consulting Group Co Ltd (CPECC) for the BOT ( Build Operate Transfer) of 2 X 600 Megawatts Coal Powered Electricity Plant in Vietnam.

finally...the project is progressing well, according to plan and schedule.
13/06/2017 15:24
stockmanmy AMCham is American Chamber of Commerce....it is a biased group for promoting American interests.
13/06/2017 15:27
Alex Foo how come lemon can go up? =(
13/06/2017 15:28
kcchongnz Posted by stockmanmy > Jun 13, 2017 03:06 PM | Report Abuse

kc

Jaks from $ 1.00 now, $ 1.50...
Sendai from 50 sen , now $ 1.08

ME: WHEN SOMEONE APPEARS TO BE RICH, AND MONEY HAS NO VALUE AT ALL TO HIM, HE CAN BUY A ILLIQUID STOCK FROM RM1.00 TO RM1.75. THAT IS COMMON SENSE THAT YOU AS AN 'ACCOUNTANT", FAILED TO UNDERSTAND. OR RATHER UNDERSTAND, BUT PREFER TO BE AN ACCOMPLIANCE, OR A RUNNER. POOR YOU.

ok...that is the past...

when Jaks crosses $ 2.00
Sendai crosses $1.50.......you retire? stop misleading ambitious young people

I RETIRE? I RETIRED 20 YEARS AGO FROM ENGINEERING AND WENT TO NZ TO ENJOY MY LIFE ALREADY LOH.

RETIRING FROM TEACHING PEOPLE THE 'RIGHT PATH' IN INVESTING? YOU HAVE NO IDEA WHAT I HAVE CONTRIBUTED TO THE INVESTING COMMUNITY, UNLIKE YOUR JUST BARKING HERE AND THERE, WITH HUGE NEGATIVE VALUE TO THE YOUNGSTERS.

CAN JAKS CROSSED RM2.00 AND SENDAI RM1.50. VERY LIKELY IF THE THERE IS NO MAJOR CRISIS. IT IS NOT EASY TO PAKAT, I BELIEVE, IT HAS BEEN GOING ON, TO JACK UP JAKS SHARE PRICE, ESPECIALLY FOR PEOPLE WHOSE MONEY HAS NOT MUCH VALUE EXCEPT TO BOAST UP EGO.

SO WELL DONE 'ACCOUNTANT' AND YOUR 'BUSINESS SENSE'.
13/06/2017 15:30
kcchongnz But don't forget, when there is a problem (out of scores of potential problems) surfaces, or an economic or financial crisis, or just high inflation, devaluation of Dong etc., with the huge bet with huge leverage, I bet Jaks will fall like a Niagara Falls, and nobody can stop it.
13/06/2017 15:34
CharlesT 1) Pahang Consolidated -H (Holland) factor (total loss of 30M+???)
2) Xinquan -H (Holland) factor (total loss of 60M+??)
3) JAKS - H or X Factor ?? (RM200M+ inside)

No prize for those who made a correct guess...sorry
13/06/2017 15:58
CharlesT For those who follows him, L (Luck) Factor is very important if u simply hentam
13/06/2017 16:01
Jonathan Keung do your homework and see what risk you can accept. buying trading stocks are different from holding dividend counters. penny stocks have their own players. play big win (loss) big. rich assets counters tend to be slow moving. you hold 2 -3 years not necessary equal profit. your holding hosts ??? sometimes we are trapped in asset rich counters. there are plenty property counters who fall into this category
13/06/2017 16:01
Alphabeta Another potential problem is the lack of investment by Vietnam into Coal Mines.

Vietnam is going ahead with plans to build a new coal-fired power plant despite experts’ warnings over the nation’s coal depletion and the dangers of depending on imported fuel.

Energy analyst Dr Nguyen Tien Chinh has advised that Vietnam is taking a risk in setting up new thermal power plants without clear sources of coal supply, news outlet Vietnam.net reports.

The nation’s domestic coal production has been falling below government targets, and the government announced that it would consider adjusting its plan for coal imports to begin earlier and import more. Vietnam Energy Association chair Tran Viet Ngai said at the time that the nation would likely begin importing coal in early 2015, two years ahead of schedule.

"It's not easy for Vietnam to increase its coal output now, given that production cost is higher while there hasn't been sufficient investment in the coal mining sector," Ngai said in an interview with the Wall Street Journal. "We now have to dig deeper to get coal and importing is inevitable."

Vietnam face the same problem as India, coal production falling behind and imported coal too costly. Another issue is the investment in the power distribution network may affect the off-take of electricity. Mudajaya 26% interest Power plant in India is facing delayed and cost overrun. Risk of construction progress & cost escalation is one part, interest & currency risks, and finally risk of capacity off-take.
13/06/2017 16:03
stockmanmy Business sense...Jaks has the best location, coal coming from up stream by barge. coal mine being just up stream from plant.

and Jaks not even a pioneer.....US$ 2 billion for 1.2 GW plant is fair and normal, the agreements comes with adjustments for coal price fluctuations, just like YTL.

other US$ 2 billion plant already online and profitable.

it is national interest of Vietnam that Jaks succeeds and national electricity plan succeeds.
13/06/2017 17:17
stockmanmy kc

you don't like word business sense? How about instinct?

How to develop killer instinct? Killer instinct to enable one to drive Rolls Royce.

learn by observing maverick.



.
13/06/2017 20:19
Icon8888 Koon's attack dog is out to attack KC again

Whether KC right or wrong doesn't matter, just attack

Then master will be happy and throw him a bone
13/06/2017 20:25
stockmanmy icon

I think it is good ambitious young men learn how a maverick operates. How to have a chance at Rolls Royce, enough of math teacher that goes no where.
13/06/2017 20:50
stockmanmy Sendai rally shows how important improving earnings is to share price.

Successful investors have the killer instinct whenever such opportunities present itself.
14/06/2017 09:35
stockmanmy the interactions between world news and successful investors is a subject far more interesting , far more rewarding than maths teacher.

not easy to teach or to learn....some calls it business sense. Or instincts.

but can starting the lesson using Sendai as case study.
14/06/2017 09:49
soojinhou Unbelievable, there's more stocknanny's post than anyone else's in this thread, and probably in the entire i3 forum.
14/06/2017 20:32
stockmanmy learn to be Rolls Royce investors

better than Proton Saga investors.
15/06/2017 11:46
CKCS stockraider lose until pokai in Evergreen. No one will believe the loser lol
20/06/2017 09:13
CKCS stockraider lose until pokai in Evergreen. No one will believe the loser lol
20/06/2017 09:14

Is Jaks a big fat frog jumping all around? kcchongnz

Author: kcchongnz   |  Publish date: Mon, 22 May 2017, 01:29 AM


Jaks has secured agreements which include a land-lease deal, a power plant agreement, build-operate-transfer (BOT) contract, coal-supply agreement and a government guarantee. More importantly, it has roped in an established power plant builder, China Power Engineering Consulting Group Co Ltd (CPECC) as its equity partner to build a 1200 MW coal-fired power plant in Hai Duong province, Vietnam. The JV company has also secured US$1.4bn (c.RM5.8bn) in financing, or 75% of project costs. Works have commenced in 2QCY16, with the first phase to be completed by 2020. We expect its near term earnings to be underpinned by its Vietnam engineering, procurement and construction (EPC) contract worth RM1.9bn.

Jaks, together with CPECC, is constructing a BOT power plant, with an estimated cost of US$1.87bn with 25 years’ concession and power purchase agreement with Viet Nam Electricity (EVN). US$1.4bn already secured back in September 2015 from Industrial and Commercial Bank of China, China Construction Bank Corporation and Export-Import Bank of China. The JV has US$160m capital (equity portion) and expects the remaining balance of US$307.1m to be injected in the next 3 years. Management expects strong IRR in the mid-teens with the first unit expected to be completed by mid-2020, and the second unit 6 months later.”

Source Public Investment Bank Berhad, January 10 2017.

 

The JV for the power plant development requires capital to develop this project, in return, they are rewarded with regular income from the sale of electric power over a period of 25 years, at a rate of return, I term it as an Internal rate of return, IRR.

How good is this project? We will have to do a financial analysis of the project based on the net present value (NPV), or internal rate of return (IRR) using the cash inflows and outflows from the project. This we need some knowledge of finance.

The link below explains what NPV and IRR are and their importance in assessing the viability of a project.

http://www.investopedia.com/walkthrough/corporate-finance/4/npv-irr/introduction.aspx

According to the report from Public Investment Bank, the cost of the power plant development is estimated to be USD1.87 billion. 75% of the cost, or USD1.4 billion has been secured. The equity portion of the joint venture, JV, is 30%, or USD470 million, of which USD160m had been paid up, with the rest of USD310m, or RM960m, to be injected in the next three years. Part of the additional equity injection will be from the construction “profit” of about RM400m, or estimated 20% profit from the RM1.9b EPC works.

The construction “profit” is just an accounting number, from left pocket to right pocket, and back to left pocket, assuming each partner has the same share of the cake of 70-30 as the JV partnership. In fact, the JV has to find another RM560m from somewhere to be injected into the JV as equity.

As you can see, there are cash inflows and outflows to and from Jaks and CPECC; inflows such as construction profits, regular income from power sales, outflows such as equity injections, initial as well as for the next few years.

All the numbers above may not be correct, as I have to admit that I do not know much about this project, but merely share the little that I know and what I thought. The pertinent questions are; what is the NPV, and what is your required return?

For NPV computations, we need to estimate all these future cash outflows and inflows at different periods, and discount them back to the present with a discount rate. The discount rate will depend on many factors, some of which are as below:

  1. Inflation rate
  2. Currency risk
  3. Risk free rate
  4. Execution risk
    1. Construction risk
    2. Coal supply risk
  5. Partnership risk
  6. Payment risk
  7. Political risk
  8. Social and environmental risk
  9. Others

Currently the 10-year government bond rate is 5.8%, and inflation rate is about 4.5%. The Vietnamese Dong was known to be volatile historically.

What would be your required return if you were to invest in a business in Vietnam with all the risks above?

For me, my required return will be a summation of risk free rate plus a risk premium. The risk premium will depend on how risky the project is, and how uncertain are the future cash flows estimations. For a normal business locally, my required return would be around 10%-15%.

If your required return is say 6%, lower than the estimate IRR of “mid-teens” as given by the Public Investment Bank report, you would probably be safe and would get a high positive NPV, which is good. Otherwise your NPV will be negative, a project which should never be started. This is because capital is a scarce resource. There is opportunity cost, and there are risks.

If your required return is substantially lower than the estimated IRR, you probably will be ok investing in Jaks. However, if your required return is substantially higher than the estimated IRR, you would be in for financial trouble.

Hence, the viability of investing in Jaks solely depend on your required return compared to NPV or IRR and the accuracy of estimation of future cash flows.  The construction “profit” is just a smokescreen, unless Jaks is the contractor doing most of the EPC works and reward itself, itself only, with big fat construction margins.

 

Labels: JAKS
  6 people like this.
 
r°Moi .


Beary you are a moron period


.
22/05/2017 17:36
boonwei98 Reminds me of my kindergarten years when i see these comments hahahah
22/05/2017 19:08
shunfeng2032 Supply and demand will decides if the stock price will go up or down. Just like Fibon.
22/05/2017 20:28
sunztzhe Ideas percolate. Through natural selection, the best ones survive.

Andrew Lo
22/05/2017 20:32
sunztzhe It's important to understand how people perceive risk, and how that translates into investment behavior.

Andrew Lo
22/05/2017 20:35
sunztzhe Great investors need to have the right combination of intuition, business sense and investment talent.

Andrew Lo
22/05/2017 20:35
sunztzhe Most people are overconfident about their own abilities. That is probably a good thing. But we would be horrified if a physician's aide engaged in heart surgery.

Andrew Lo
22/05/2017 20:44
PlsGiveBonus Bitcoin fly to the moon already value investing still cannot go up
:D
Today digital coin total market cap exceeding 80b USD!!
Huge jump from a 50b just last week!
22/05/2017 21:50
kcchongnz Posted by stockmanmy > May 22, 2017 10:13 PM | Report Abuse
so kc...details matter....
project IRR 12% can transform into huge equity IRR once gearing ( borrowings) is taken into account.


Can you elaborate what you mean here?

"project IRR"? equity IRR? what is the difference?

How "borrowings" come into the equation of IRR?
22/05/2017 23:56
kcchongnz Posted by stockmanmy > May 22, 2017 10:20 PM | Report Abuse
kc
share market is short term in nature.
business men can be longer term in nature.

ME; SO WHAT ARE YOU TRYING TO SAY?

but who will believe you no money to make in a US$ 2 billion project?

ME: WHO SAID GOT MONEY OR NO MONEY TO MAKE? AND WHETHER IT IS US$2 BILLION OF $2 M?
22/05/2017 23:59
kcchongnz Posted by stockmanmy > May 22, 2017 10:33 PM | Report Abuse
kc

nobody force you to buy.

ME: WHO SAID WHO FORCED WHO TO BUY? JAKS BELONG TO YOU?

but lots of stuffs you just assumed....and starts to comment.

ME: WHAT DID I ASSUME? CAN'T I WRITE AN ARTICLE TO SHARE MY POINT OF VIEW? SO EVERYONE MUST LISTEN TO YOUR VIEW, AND YOUR VIEW ONLY?

eg...to reporters in Hanoi....what you want Jaks MD to say? that their equity IRR is very high?

ME: ????

on a project IRR of 12% ( before gearings)

ME: IRR 12% BEFORE GEARING? IS THAT IRR OF 12% ALL FROM JAKS OWN POCKET WITHOUT BORROWINGS?

......what would profits be on 3:1 gearing and 6% interest rate? Any ideas?

ME: EVALUATION OF A PROJECT IS BY IRR, NPV, OR THE CRUDE PAYBACK PERIOD.
I GOT NO IDES WHAT YOU ARE TALKING ABOUT! YOU TELL ME THEN.

even assuming 12%, it is nothing to laugh at with US$ 2 billion project.
ME: LAUGH AT WHAT? WHO LAUGH AT WHO?

12% means it doubles every 6 years......how many doubling in the concession period?

ME; WOW, EUREKA, USING RULE OF 72 TO EVALUATE A PROJECT. SENSATIONAL!
23/05/2017 00:08
GoldenEggs The answer is simple: If Jaks succeed, Mr.Koon will be a billionaire. If it fails, then kc is right. Please note that many rich people get rich through low roic business like YTL (2.1b usd net worth). No point argue whether power business is viable or not.It's a matter of execution of this project. If the capital is not investing in... then how we get all the electricity that we need.........
23/05/2017 00:08
kcchongnz Posted by stockmanmy > May 23, 2017 12:00 AM | Report Abuse
project IRR means you calculate the IRR assuming no borrowings, all equity.
equity IRR means the real equity IRR based on the gearing proposed.



WOW, THIS IS REALLY EVOLUTIONARY!
23/05/2017 00:10
kcchongnz Posted by stockmanmy > May 23, 2017 12:14 AM | Report Abuse
kc
you are just being naughty... I have to assume you understand simple cash flow projections and IRR.

ME: IT IS RATHER ODD THAT I AS AN ENGINEER UNDERSTAND IRR PERFECTLY WELL, WHEREAS AN ACCOUNTANT HAS SHOWN HE HAS NO CLUE AT ALL WHAT IRR IS WITH ALL THOSE STATEMENTS.


bottom line is as golden eggs says....it is all about execution and business risk.

ME: ISN'T MY ARTICLE SHARED ABOUT RISK AND REWARD, INCLUDING BUSINESS RISK AND EXECUTION RISK?

there is enough profits in the IPP to make Jaks MD the new Francis Yeoh and KYY a billionaire if it succeeds.

ME: WHY DO YOU HAVE TO BRING ALL THESE PEOPLE IN FOR DISCUSSION OF THIS TOPIC? DID I MENTION ANYONE OF THEM?
23/05/2017 00:25
cheoky i guess you only know gibberish and rubbish.
23/05/2017 00:45
kcchongnz Posted by stockmanmy > May 23, 2017 12:25 AM | Report Abuse

kc

you are an academician....trained to look down at IRR 12%...

ME:ACADEMICIAN? WHO? I AM AN ENGINEER. HOW MANY TIMES I HAVE TO SAY THAT? I WAS EVEN A LEAD CIVIL ENGINEER IN A POWER PLANT BEFORE.

TRAINED TO LOOK DOWN AT IRR 12%? WHO LOOKS DOWN? DID I MENTION I LOOK DOWN ON IRR OF 12%/ WHERE?

but details matter.......there are many ways to compute IRR, without looking at the workings, you just cannot say 12% is low.

ME; MANY WAYS TO COMPUTE IRR? WHERE YOU LEARN ONE? WHO SAYS IRR 12% IS LOW?

there is a third IRR which is even higher....remember $ 400 million of the equity actually came fom EPCC? That means the real equity is much smaller, and that translates into an adjusted real equity IRR which is even much much bigger.

ME: WOW, THIRD IRR! INCREDIBLE!

LET AN ENGINEER TEACH AN ACCOUNTANT A LITTLE FINANCE. IN A PROJECT FINANCIAL APPRAISAL, THERE IS ONLY ONE IRR. CASH IN, CASH OUT, BEGINNING VALUE, END VALUE, ITERATE THE DISCOUNT RATE TO FORCE THE BEGIN VALUE EQUALS TO THE END VALUE, YOU GET IRR. YOU MAY GET TWO VALUES, BUT ONLY ONE IS CORRECT.

COMPARE YOUR REQUIRED RETURN TO THE IRR. YOU THEN CAN DECIDE IF THE IRR IS GOOD.

YOUR REQUIRED RETURN DEPENDS ON MANY THINGS, COST OF BORROWINGS, BUSINESS RISKS, FINANCIAL RISK, CONFIDENCE OF EARNINGS AND CASH FLOWS ESTIMATES. IN THIS CASE, MANY OTHER RISKS SUCH AS CURRENCY RISKS, POLITICAL RISKS, PARTNERSHIP RISK, ETC.
23/05/2017 00:46
kcchongnz Posted by stockmanmy > May 23, 2017 12:41 AM | Report Abuse
and kc

please don't assume I know nothing because you really don't know any thing about me....just as you don't know the deatiled workings when Jaks MD says project IRR is 12 %.

ME: WELL, I THINK I CAN JUDGE YOU VERY WELL.
MY POST DOESN'T SPECULATE ON ANYTHING, JUST BASED ON WHAT WERE GIVEN SUCH AS IRR. MAY BE YOU CAN TELL US WHAT THE "EXTRA' THAT YOU KNOW.

They have teams of bankers, project managers and accountants going through every single item, and they have to present to the Vietnam government in such a way everyone is happy.

ME: WHOSE INTEREST BANKERS CARE OF? SO IF YOU ARE HAPPY WITH IRR OF 12%, THAT IS FINE. WHO HAS OBJECTION ABOUT THAT?

Jaks first went to Vietnam in 2006...imagine it is 11 years in the making. ..The guy is great and deserves his success.

ME: WOW, 11 YEARS ALREADY. REALLY GREAT!
23/05/2017 00:51
probability Wow! so beautifully put :)

LET AN ENGINEER TEACH AN ACCOUNTANT A LITTLE FINANCE. IN A PROJECT FINANCIAL APPRAISAL, THERE IS ONLY ONE IRR. CASH IN, CASH OUT, BEGINNING VALUE, END VALUE, ITERATE THE DISCOUNT RATE TO FORCE THE BEGIN VALUE EQUALS TO THE END VALUE, YOU GET IRR. YOU MAY GET TWO VALUES, BUT ONLY ONE IS CORRECT.

COMPARE YOUR REQUIRED RETURN TO THE IRR. YOU THEN CAN DECIDE IF THE IRR IS GOOD.

YOUR REQUIRED RETURN DEPENDS ON MANY THINGS, COST OF BORROWINGS, BUSINESS RISKS, FINANCIAL RISK, CONFIDENCE OF EARNINGS AND CASH FLOWS ESTIMATES. IN THIS CASE, MANY OTHER RISKS SUCH AS CURRENCY RISKS, POLITICAL RISKS, PARTNERSHIP RISK, ETC.
23/05/2017 01:01
ipomember your required rate of return could be subjective compare to the company required rate of return as the company has difference stance? What is the IRR norm for coal-based power plant in Vietnam? I am sure they have done their research prior that. For the risks mentioned, i think the management has addressed well through their meeting with PBB analyst. Of course there are still some assumption but that is what business is afterall.
23/05/2017 01:26
probability stockmanmy, always define where is the conflict first...
perhaps his statement is completely inline with yours..
what is it that you are stressing and trying to put across?
where is your confusion/dispute with his statements?
23/05/2017 02:00
CharlesT Kc dont bully 61 years old retired senior ac clerk lah
23/05/2017 06:52
r°Moi Post removed. Why?
23/05/2017 07:59
r°Moi .

Anyway... for what that we all know... for the foreseeable and mid term... watch this closely... the EPC be a very good start for the IPP project



r°Moi And.... the (EPC) contract worth RM1.9bn... could well be much much easier than r°Moi had earlier thought

22/05/2017 08:40


.
23/05/2017 08:01
shunfeng2032 Let ride TRC, don't waste time on Jaks. whats the point analysing it when you not interested to invest in it? Jaks has Uncle Koon, i will join in few years time but not now.
23/05/2017 10:54
kelvin61 Why so much fuss over JAKS? Before this, it was JTiasa, Xingquan, among others. What happened to these stocks subsequently? Why only blow trumpet on the winners but forgot to highlight the losers. By being transparent, we can then judged how good the person really is.
23/05/2017 11:00
PlsGiveBonus Value investing only care about getting cheaper
And the cheaper they think the lower they will want to buy
And the price will keep going down despite the market condition is bullish
This is how the newbie get into value trap
The low get lower
23/05/2017 13:10
aseng this discussion has really aroused my interest to know more what is IRR

from my reading so far, still have not truly understood what is IRR, I am glad to say that

1. KC had presented his case systematically , readable and comprehendible ,
very good, and has aroused my interest to know more

2. Stockmanny , i do not know how to write anything good about you , honestly
speaking I do not understand what are you trying to say about IRR, I have a
feeling you are trying to mislead the reader into buying a high risk stock at a
high price, that is very bad , no good

my conclusion : JAKS not a good buy at current price !

why ?

the risk is very very very... much higher the the big reward

what is the major risk?

KYY holding !!!!!

when he starts selling you cry like no tomorrow

what to do ?

BUY GADANG !!!

WHY?

CAN SLEEP WELL !!!
23/05/2017 13:11
PlsGiveBonus Next time we will see value investing in digital coin soon
This is the richest that create value rule
The best value digital coin is the one use the less energy to mine a single coin!
See this is how rule is being made
23/05/2017 13:15
PlsGiveBonus After few year another set of new rule will surface
The best value digital coin is the one that pay good dividend
Oh yeah digital coin also can pay dividend
And safety of margin in digital coin is xxx%
It is cheap!
23/05/2017 13:17
kcchongnz Posted by CharlesT > May 23, 2017 06:52 AM | Report Abuse
Kc dont bully 61 years old retired senior ac clerk lah


Charles, look at who is trying to bully who. Hear it from a third party, a credible person.


Posted by Ooi Teik Bee > May 21, 2017 12:12 PM | Report Abuse
Someone is looking for every chance to attack KC and valued investors.


What I am trying to do is to have some discussions with this 61 year old accountant, on accounting and finance, who "is looking for every chance to attack KC and valued investors."
23/05/2017 15:31
youarefoolidiots Aiya, pity KC loh, always bully by a dog. Whatever KC said sure kena twisted by the doggy
23/05/2017 15:46
kcchongnz Posted by ipomember > May 23, 2017 01:26 AM | Report Abuse
your required rate of return could be subjective compare to the company required rate of return as the company has difference stance? What is the IRR norm for coal-based power plant in Vietnam? I am sure they have done their research prior that. For the risks mentioned, i think the management has addressed well through their meeting with PBB analyst. Of course there are still some assumption but that is what business is afterall.

If I invest in a company, I do not simply accept what the management says. That is my style. No, I do not invest in this company. No, I wrote this to share with people here what I think, not to degrade the company. I like to write and share. I know many do not like me doing so, but I think there are some more mature investors who like to hear the other side of the story to make a better investing decision.

Note management is not the same as shareholders, and they have different interest, although often management wears two hats, but still their interest is not the same as other shareholders. I know this well as I was a corporate guy before.

I present my points here about what construction accounting profit is about, what is the risk free rate in Vietnam, opportunity cost, cost of capital and the various risks involved in the project. It is your duty to evaluate the management is doing the right thing, for you as a minority shareholders. It is not about whether "the management has addressed well through their meeting with PBB analyst". Well, that is what I think, looking at the business sense of it.

If you think your company is taking such a great project with such a great IRR, good on you. Go invest more. Sailang on it. You may soon become very rich.
23/05/2017 16:14
OptimusCallShitBaba KYY has proved his stock selection LOUSY & TERRIBLE! With the latest result release by Lii Hen, no pleasant surprise at all.

KYY has failed in XinQuan, doing so so at CSCSteel & Lii Hen, remain to be seen at Jaks.

While everyone seem doing very good in 2017, KYY stock selection based on his OLD MAN SENSE was terribly bad!

http://klse.i3investor.com/servlets/pfs/54015.jsp
23/05/2017 17:51
PlsGiveBonus Bitcoin set to record high again!
The best investment that actually make everyone become millionaire
unlike klci which always make people poorer and banker getting richer only
:(
all this value investment is junk
:x
24/05/2017 19:58
PlsGiveBonus The Bitcoin I mined last few years already appreciated by few thousands percent and make nearly one million for me while klci still making loss non stop
Sooner or later I will quit this stupid market and focus on Bitcoin development
:))
29/05/2017 00:29
stockmanmy you know how to mine bit coins? respect.

some say it will be US$ 20,000 in a few years.
29/05/2017 00:55
stockmanmy charles....

Financial tools must be handled with care otherwise it can be very misleading.

a project can give you $ 1000 per annum and yield you an IRR of 12%.
another project can give you $ 100 million per annum and still yield you an IRR of 12%

you will want the $ 100 million p.a. project over the $ 1000 p.a. project if you can get it.

there is some thing fundamentally flawed in maths teacher way of looking at things.

Businessman look at the money, follow the money...be direct about it.
29/05/2017 01:03
PlsGiveBonus Not only I know how to mine it
I am lending it out for some interest income
and the interest income is good
:))
29/05/2017 01:10
kcchongnz Posted by stockmanmy > May 29, 2017 01:03 AM | Report Abuse
a project can give you $ 1000 per annum and yield you an IRR of 12%.
another project can give you $ 100 million per annum and still yield you an IRR of 12%
you will want the $ 100 million p.a. project over the $ 1000 p.a. project if you can get it.
there is some thing fundamentally flawed in maths teacher way of looking at things.
Businessman look at the money, follow the money...be direct about it.

I am an engineer by profession. I am a teacher teaching you this accountant on accounting stuff. But no matter how much i teach you, you just don't get it. And yet you still continue to bark here and there, "tearing your own face". Shame on you!

Let me teach you another accounting lesson.

What is IRR of 12% of your Jaks? Is this an expectation or an outcome?

It is just basing on estimation of future cash flows.

What if there is a financial crisis and banks pull back the credit?
What if Dong, the currency of payment, slumps 30% in the future?
What if the cost overrun by 30% for the power plant?
What if the Chinese partner makan you?
What if the inflation rate goes up to 10% a year?
What if the Vietnamese official ask you to pay more money to him, otherwise this cannot, that cannot?
What if risk free rate goes up to more than 10%?
What if the Vietnamese agency refuse to take your power supply or reduce your rate say if there is no demand for the power?
What if this and what if that?

Those are the risks we are talking about!

The outcome of your IRR, instead of 12%, becomes -10%!

What happen to Mudajaya's power plants in India?
Why was there such a delay?
Wasn't their expected IRR also in the teens?

What happen now?
How much money they have lost?
What is their IRR now? negative 20%?

All the things you talk about dynamite investing, panic moment, sailing, take high risk and sure high return are just talking cock!

Where got business sense? You kidding?
29/05/2017 01:21
PlsGiveBonus Did Bitcoin pay good dividend?
Yes it pay good dividend
refer to this website for a good lock
https://www.poloniexlendingbot.com

this technology will rewrite the rule of investment forever
29/05/2017 01:26
stockmanmy KC and his IRR is old school

Bitcoin and block chains are the real deal.

sounds exciting to me but I too old to learn.

my son is studying CFA
my daughter is studying Big Data and Analytics.

who will have a brighter future?
29/05/2017 01:36
stockmanmy a small project with small capital and decent earnings will give you IRR 12% and $ 1000 p.a.

An US$ 2 billion IPP project with decent earnings will give you an IRR 12% and US$ 100 million p.a. if the capital structure and gearing levels are done right and especially if there is an early recovery US$ 100 million of capital from EPCC...follow the money...details matter.

Good businessman will choose the latter, maths teacher thinks there is equivalence....that is why business man drive Rolls Royce and maths teacher drives what?
29/05/2017 01:49
stockraider Let me teach you another accounting lesson.

What is IRR of 12% of your Jaks? Is this an expectation or an outcome?

It is just basing on estimation of future cash flows.

What if there is a financial crisis and banks pull back the credit?
What if Dong, the currency of payment, slumps 30% in the future?
What if the cost overrun by 30% for the power plant?
What if the Chinese partner makan you?
What if the inflation rate goes up to 10% a year?
What if the Vietnamese official ask you to pay more money to him, otherwise this cannot, that cannot?
What if risk free rate goes up to more than 10%?
What if the Vietnamese agency refuse to take your power supply or reduce your rate say if there is no demand for the power?
What if this and what if that?

Those are the risks we are talking about!

The outcome of your IRR, instead of 12%, becomes -10%!

What happen to Mudajaya's power plants in India?
Why was there such a delay?
Wasn't their expected IRR also in the teens?

What happen now?
How much money they have lost?
What is their IRR now? negative 20%?

All the things you talk about dynamite investing, panic moment, sailing, take high risk and sure high return are just talking cock!

Where got business sense? You kidding?

RAIDER COMMENT A 12% IRR PAPER PROFIT ON A GREENFIELD PROJECT ON VIETNAM IS NOT WORTH IT LOH...!!
AS KC HIGHLIGHTED THE WHAT IF POSSIBILITY RISK IS VERY HIGH LOH..!1
BTW...THE COST ON BORROWING ON VIETNAM DONG ALREADY 10% PA LOH..!!
ONLY SOOCHAI LIKE KYY WITH NO BUSINESS SENSE SAYS GOOD ON IRR 12% PA VERY GOOD....U DESERVE A HIGHER RETURN ON THIS TYPE OF INVESTMENT LOH...!!

WHEN KYY STOCK PROMOTION CUM STOCK MANIPULATION STOP THIS WILL OVERVALUE STOCK WILL CRASH MAH...!!
29/05/2017 11:42
stockmanmy there are good reasons KYY drive Rolls Royce and raid drives what? Not all luck.....hahahahaha
29/05/2017 11:46
stockraider BTW...KYY DO NOT OWN ANY ROLLS ROYCE LOH...!!
29/05/2017 11:47
PlsGiveBonus Yeah the future for IT is very bright
I know this guy Vitalik Buterin he is the founder of the software that will change this world how banking operate and rendering all the greedy banker to jobless
He is billionaire by net worth at the time of writing
Also the alpha go success is another mile stone to strengthen the future of IT

https://en.m.wikipedia.org/wiki/Vitalik_Buterin

https://m.youtube.com/watch?v=k0HmrSfJwhU
31/05/2017 11:17
stockmanmy too late, no genius in the family.
31/05/2017 11:32
stockmanmy no genius in family
develop business sense good enough
31/05/2017 11:33
PlsGiveBonus IT is replacing all conventional business operation
They do not need to develop new business
Just replace the existing business with IT
It is very cheap to do so.
31/05/2017 11:55
Stock Kingdom Big fat frog is now dying on the road, soon it will become fried skinny frog
22/06/2017 23:21

Value Investing? Boring! Sien ah! kcchongnz

Author: kcchongnz   |  Publish date: Sat, 13 May 2017, 01:49 AM


In my last article in i3investor, I discussed about how I used a value investing strategy of dividend yield and invested in a portfolio of 5 high dividend yield stocks as in the link below,

http://klse.i3investor.com/blogs/kcchongnz/122285.jsp

I got another comment from my regular critic as below,

[Posted by stockmanmy > May 7, 2017 07:47 PM | Report Abuse http://cdn1.i3investor.com/cm/icon/trans16.gif

Value investors did not do well this year.
kc also no business.
I hope things will change for the better for him.
in the meantime, I stick to X factor
.]

Thank you again, no criticism no fun. And thanks for your “hope that things will change for the better for him”, but no thanks for your “hope”. As you know, I do not depend on hope to do well in investing. For your information, I have written many articles in i3investor and provided with ample evidences that basing on value investing which I have been propagating, I have been doing very well in the long-term, as well as the short-term.

 

Let’s just put aside what he means by his frequent uttering of “X factor”, whatever it means. It makes me “one head full of dew water”. We don’t need to get stressed on what he means.

But what makes him think that “Value investors did not do well this year”? Is he using value investing, that he has been doing badly this year?

If you read my article above, with a portfolio of 5 Bursa dividend stocks selected and published at the end of 2015 for investing in 2016 and beyond, with detail analysis published in i3investor, based solely on the principles of value investing, gained an average of 67.4%, with approximately the same median return, for the last one-and-a-half-year period as on 30th April 2017 as summarized in link below,

http://klse.i3investor.com/blogs/kcchongnz/122285.jsp

The broad market returned just 3.8% during the same period.

 

One year short-term return of value investing in Bursa

Exactly one year ago, I started a stock pick service in Bursa for my past course participants. This was discussed in i3investor in the link below,

http://klse.i3investor.com/blogs/kcchongnz/101036.jsp

As all stocks were picked due to their stable earnings and cash flows, and healthy balance sheets and good dividend yields, and picked when they were generally selling at cheap or reasonable prices, the very essence of value investing, the risk involved is naturally very low.

The portfolio of 14 stocks selected progressively over the year made an average return of 16.9% compared to the gain of 3.0% of the broad KLCI index, and the gain of 5.9% of the broader FBMEMAS Index during the same period. The excess return of the portfolio is hence a whopping +13.9%.

The earlier participants of this service who invested in Bursa made an average return of 30% over the past one year as on 30th April 2017, compared to the gain of the market of 3% during the same one year period.  The excess return, or alpha, is 27%. The highest return was closed to 40%.

 

Nine months’ return investing in SGX and HKSE as on 30th April 2017

We also started a foreign stock pick service in SGX and HKSE about nine months ago, again using our value investing strategy which we have discussed in this link below,

http://klse.i3investor.com/blogs/kcchongnz/102200.jsp

The reasons we did that was to assist my course participants to diversify investment regionally, plus at that time, the SGX and HKSE was at much lower valuations than KLSE. The intention was to obtain satisfactory results over a long-term period, and not chasing fast gain over the short period.

For the last nine months since 27th August 2016, a total of 8 stocks were selected progressively by our “Chief Investment Officer” who had been my value investing course participant, and practice his value investing strategies to pick stocks.  We also have a couple more past participants of my value investing course contributing to the service.

After 9 months have passed as on 30th April 2017, the average return of the portfolio of 8 stocks selected progressively returned 34.0% in nine months, with a substantial higher median return of 52%. These returns out-performed the 10.4% and 7.4% of the broad index of SGX and HKSE respectively during the same period by miles ahead.

There were a few high return stocks; Sungningdale at +63.5% in 8 months, Avitech +76.4% in 7 months, Fischer Tech at +69% in 3 months, and Valuetronics +52.3% in 6 months.

Most interestingly, there is not a single loser in the stocks selected. This fit very well in our principle of,

“Take care of the downside; the upside will take care of itself”

This return on investing in the stocks above has not taken into consideration gain in foreign exchange over the period.

A few participants early in this service made 40% to 60% total return in the nine months’ period, beating the return of the broad market of 8.9% by a wide margin. The later participants also made more than 20% in less than 6 months.

Thanks to the Chief analyst cum Investment Officer of this service, a fervent follower of value investing.

So how can you say, “Value investors did not do well this year.” What evidence do you have?

I have written many articles in i3investor using value investing strategy, until many people already fed up of reading them. Sien Ahh!

But why should one feel “sien” about value investing?

I have shown value investing works very well in the long-term with my latest article here,

http://klse.i3investor.com/blogs/kcchongnz/120190.jsp

http://klse.i3investor.com/blogs/kcchongnz/119863.jsp

I have also just shown you value investing also works extremely well in the short-term in this article.

Apa lagi lu mau?

To me, value investing is not "sien", but very interesting indeed. I never feel sien in propagating value investing, although at times it can be a little frustrating.

Value investing is, either you get it, or don't get it at all.

If you are convinced about the usefulness of value investing, which I have shown you again and again that it works and works very well, and wish to learn about value investing to make extra-ordinary return for the long term in more predictable way, or if you wish to get some help to invest in Bursa right now while learning, please contact me at,

ckc14invest@gmail.com

 

K C Chong

 

 

 

 

 

  13 people like this.
 
kcchongnz stockraider RAIDER NOT TRY TO CONVINCE MAMMY.....BUT RAIDER DON WANT HIM TO MISLEAD.....INVESTORS....THAT VALUE INVESTMENT IS LOUSY LOH...!!
IT IS HIGHLY ESSENTIAL....ESPECIALLY NEWBIES TO GET HIS GROUNDING RIGHT LOH.....!!

That is what I consider good sharing, noble intention, and from a well verse investor.
14/05/2017 11:40
stockmanmy kc and raider are not much different from JJPTR.

Got evidence in the bottom 10 portfolios of this year ibot 230 portfolio still cannot accept the evidence.

Am I the only one saying the Emperor wears no clothes?


I call that...totally and completely brain washed can no longer see reality.
14/05/2017 13:28
stockmanmy do not forget...despite all the smooth talking ......evidence suggest kc and raider way of doing things will land you near the bottom of this year's stock market performance.
14/05/2017 13:30
kcchongnz stockmanmy kc and raider are not much different from JJPTR.
Got evidence in the bottom 10 portfolios of this year ibot 230 portfolio still cannot accept the evidence.
Am I the only one saying the Emperor wears no clothes?
I call that...totally and completely brain washed can no longer see reality.


The return of my portfolio is 16.1% in 4 months and 2 weeks.

"Accountant", go ahead and calculate how much RM100000 will balloon to using the annualized return of this portfolio in 30 years.

Prove to us that you have at least worked as an accounts clerk before that you know how to calculate. I have already given you 14 hours to do that.

Then we know who wears clothes and who doesn't.
14/05/2017 13:49
stockmanmy anyone who cannot have independent thinking
anyone who needs kc to feed you popular memes
you don't get success.

it is that simple.

no different from JJPTR if you have to contribute to JJPTR , you deserve what you get.
14/05/2017 13:54
stockmanmy why ?

is it because JJPTR boss is handsome?
because kc sells popular memes?
14/05/2017 14:17
Beary OLD MAN MAMMY GO AND REST IN PEACE LAH

IF YOU WANT COMPANY, ASK THE VERY OLD MAN TO JOIN YOU.
14/05/2017 14:29
cheoky Investing is long term wealth building, if you insist on judging 1km outcome from the 42km finishing line as the runner performance, you can go fly kite and plp. Newbie like me know even this basic. This Baru called independent thinking, not con by your dynamite or x Sorchai factor. Empty n loudest tin is Mr Manny.
14/05/2017 14:36
MrPauper Suddenly, felt that this stockmanmy sounds like another calvintaneng
14/05/2017 14:38
calvintaneng Posted by MrPauper > May 14, 2017 02:38 PM | Report Abuse

Suddenly, felt that this stockmanmy sounds like another calvintaneng


No! Stockmanmy is stock monkey

Please don't associate him with Calvin

Now go see Calvin's latest post (you will be glad you did)

https://klse.i3investor.com/blogs/www.eaglevisioninvest.com/122744.jsp
14/05/2017 14:40
stockmanmy Beary, cheoky, kc, calvin, pauper( goodname)

value investors my foot....the correct description for brain washed people like you are losers....pure and simple.


Just look at the bottom 10 portfolios in ibot 230 portfolios.....all having the same stocks with same characteristics you and the popular memes have been promoting in i3 all these years.


Successful investors have learn the power of X factor long long ago.
14/05/2017 21:07
stockmanmy am I the only one to say the Emperor wears no clothes?

Look at the details , the compositions of the bottom 10 portfolios in the ibot 230 portfolios....all KC types of value investing.
14/05/2017 21:17
cheahsk Hi KC, Can you please elaborate a little on the NAV of a portfolio you just mentioned. What does this NAV tell us,how to calculate it and apply to our investment.
14/05/2017 21:18
stockmanmy kc have managed to hand pick all the dead and non performing stocks of 2017......congratulations, kc.
14/05/2017 21:19
stockmanmy kc is grasping straws and creating excuses for his under performance....pure and simple.




Posted by cheahsk > May 14, 2017 09:18 PM | Report Abuse

Hi KC, Can you please elaborate a little on the NAV of a portfolio you just mentioned. What does this NAV tell us,how to calculate it and apply to our investment.
14/05/2017 21:24
stockmanmy nothing else to offer?


Icon8818 > May 14, 2017 09:26 PM | Report Abuse

sorhai mammy! buntut ayam! terus membebel
nanti mati la lu bunuh diri macam optimus!
14/05/2017 21:28
stockmanmy icon8818


I know two other persons , besides kc , get worshipped like that before...1 MDB's fatty and JJPTR fatty.
14/05/2017 21:30
popo92 i think i really ought to work harder to be superrich who can buy 30% of jaks, if not i will be consider as low class investor
14/05/2017 22:00
stockmanmy You got the right spirit to be successful....may the X factor be with you.


popo92 > May 14, 2017 10:00 PM | Report Abuse

i think i really ought to work harder to be superrich who can buy 30% of jaks, if not i will be consider as low class investor
14/05/2017 22:04
kcchongnz cheahsk Hi KC, Can you please elaborate a little on the NAV of a portfolio you just mentioned. What does this NAV tell us,how to calculate it and apply to our investment.

I was trying to find out if that "accountant" is really one he claimed to be. alas, he can't even calculate simple compounding.

It was just a test to find out fake accountant, and it works.

A 16.1% in about 4 months will have an annualized return of about 48%. If, only if, the portfolio with that net asset value, NAV, grows by 48% in 30 years, it will grow to RM12.8 billion. That would be the highest return anyone can get in history!

So, what is wrong with my portfolio which returns 16.1% in 4 and a half months?

I am not saying the portfolio can grow at that fantastic rate for 30 years, but the question was posted to someone who bark and bark and claimed that he is an accountant. But can you believe, he can't even compute!

Even if my return so far is just half of that, say 8%, the annualized return would be about 24%. The RM100000 will grow to RM63.5m in 30 years. I would be better than the best long-term return, someone like Walter Schloss.

So "accountant", what is wrong with my return so far?

Why do you need to bark and bark?
14/05/2017 22:39
stockmanmy kc

don't kid yourself.
14/05/2017 22:57
Tai KT Manmy, why not you post an article regarding how you utilize your dynamic and X factor for stock pick. Let every one open their eye to see you powerful X factor Lol.
14/05/2017 23:07
stockmanmy kc

A more honest assessment from you would be to admit your portfolio has under performed the rest of the ibot portfolios...and looking at the other bottom 10 portfolios as well, the last few months have not been good to value investors.....but the future nobody knows....not even stockmanmy....even stockmanmy cannot write any guarantee.

But to seek honesty from a salesman is rather peculiar.
14/05/2017 23:08
stockmanmy I have 5400 posts and several dozen blogs.....we can discuss on any of those blogs and posts any time if only you point them out to me.




Tai KT > May 14, 2017 11:07 PM | Report Abuse

Manmy, why not you post an article regarding how you utilize your dynamic and X factor for stock pick. Let every one open their eye to see you powerful X factor Lol.
14/05/2017 23:11
Tai KT pls post your X Factor or repost to I3, Dont wait.
14/05/2017 23:20
kcchongnz stockmanmy I have 5400 posts and several dozen blogs.....we can discuss on any of those blogs and posts any time if only you point them out to me.


Actually it is really incredible. In the 5400 postings and several dozen blogs (?????), you only do three things,

1) Talk cock, barking
2) Ridiculing any value investor
3) PLP,PLP big time!

so what else to point to you?
14/05/2017 23:25
paperplane2016 Kc. How you view steel sector now? Appreciate your inputs
14/05/2017 23:46
kcchongnz paperplane2016 Kc. How you view steel sector now? Appreciate your inputs

I am no expert in the steel sector, sorry. I personally do not like this type of high capex and competitive industry. There are many who make good money though investing in this kind of stocks, but that was from a year ago.

I personally have made some money, not for myself, but for a friend, on Choo Bee. I find Choo Bee is different. It has consistent earnings and cash flows, and a very healthy balance sheet, with potential of positive corporate exercise. It is a low risk investment in that sense.
14/05/2017 23:54
probability ha ha...KC always have a different opinion than KYY..
14/05/2017 23:57
stockmanmy Once upon a time, many many years ago I came across this equation

Share price = existing business + X factor.

All too obvious but it allows a way to value any share, no matter how high, how speculative it is.
As an accountant, we have no problem valuing an existing business but we have no way to make sense of more than 60% of the shares traded and the valuations given by the market.
The eureka moment comes when we accountants started to pay attention to the X factor and what the market is doing. My universe suddenly expands and I see more opportunities than before..
Mentally, we have to split between the existing business and the future business ( and X factors) given by the market cap and try to make sense of it and our opinions. It is a very powerful tool which I have employed. It adds clarity.

If you want to trade, you trade the X factor...others may call it the catalysts. If you want to invest, you also have to consider the X factors, not just the audited accounts and existing business.

X of course means anything that is unknown but knowable in future., or any proposals or acquisitions or changes in micro or macro environment.

If you look at kc work....he has almost exclusively devoted his work to the audited accounts , that is very silly isn't it?

And if you need just one book to improve your performance, I do not hesitate to recommend you to William O Neil's Book and his CANSLIM methodology. ...warning....it is not your typical value investors hand book.

(Google it yourself)

I think this forum has too much of Warren Buffalo and his bluffology already.

I think, at the end of the day...it is really about mind set and where you should emphasis and devote your energy.....remember 20% of the good effort produces 80% of the results.

Value investors keep talking about buying discounted assets and discounts prices...I say baloney, that is not how the market works 99% of the time.




Tai KT > May 14, 2017 11:20 PM | Report Abuse

pls post your X Factor or repost to I3, Dont wait.
14/05/2017 23:59
probability stockman ..suggest you rename yourself as X-Men
at least it sounds more powerful..he he
15/05/2017 00:01
paperplane2016 Well. High capex yes. But seldom low capex in other industry nowadays also. Unless for IT?
15/05/2017 00:02
paperplane2016 Which sector kc you think worth looking for next year? I will avoid mfrs 9 impact companies like finance industry, insurance etc.
Property sector still no no for me also.
Plantation nothing surprise, some with new production in maturing stage might see higher profits only.

Other like IT, semiconductor might be ok I guess? And some sector to benefit from China De overcapacity like steel, metal, tin etc?

Other than this, low capex I can think of maybe is Johotin now. Others like aeoncr also need keep on asking capital once business expanding fast. Transportation need to have more cars, more drivers to expand business etc.
15/05/2017 00:10
stockmanmy isn't Choo Bee a typical value trap?

I avoid this kind of share all the time.

a steel trader, no competitive advantage, no catalyst, no X factor, showing declining revenue, the company is in the process of downsizing....typical value investor stock.
15/05/2017 00:12
stockmanmy go and buy Choo Bee and come back tell me the result in one year time.


probability > May 15, 2017 12:01 AM | Report Abuse

stockman ..suggest you rename yourself as X-Men
at least it sounds more powerful..he he
15/05/2017 00:13
probability X-men...you are right...its x-factor is the export potential....suggest you look into Mycron as you seem to like cscsteel

Posted by stockmanmy > May 15, 2017 12:13 AM | Report Abuse

go and buy Choo Bee and come back tell me the result in one year time.


probability > May 15, 2017 12:01 AM | Report Abuse

stockman ..suggest you rename yourself as X-Men
at least it sounds more powerful..he he
15/05/2017 00:19
probability Mycron's steel tubes had expanded overseas... if you see their steel tube products (refer catalogs) - its of international standards unlike Choo Bee...but imagine if even Choo Bee is already exploring Foreign markets...
15/05/2017 00:24
probability no harm VenFx...at least we dont leave the reasons (for promoting) mysterious like x-factor..he he
15/05/2017 00:38
probability VenFx...seriously you did not have to delete your postings done in a sincere manner...telling your opinions which are sincere to yourself...unless KC dont like...but im sure he faham2 as we dont do it always...
15/05/2017 00:40
VenFx Hehe, no problem probability sifu.
I say what I thought sometimes.
Thx for remind also.
15/05/2017 00:42
VenFx Manmy, if u hv time pls share some info on ONE BELT ONE ROAD impact to the region and the industry. As I believe this is a great great catalyst that going to stir up many sectors for 10-50yrs.

1 路1带 可旺 千年。No kidding :)
15/05/2017 00:45
VenFx Manmy sometimes too imaginative, and need to be more diversify lar...
So, help me up manmy sifu.
I believe in his knowledge, when he is not play it biasly.
15/05/2017 00:47
stockmanmy We have to assume what can go up will keep going up until the market turns bearish...and a lot of people holds on to their shares nervously and tries too hard to time the market.

That is why I believe most people under performs their ibot portfolio because people tends to sell too early and leaves too much on the table...I have to admit I am amongst those very quilty of selling too early.
Luckily, I have X power to help me get back in without leaking too much and also I made a lot of money earlier this year on Jaks and Sendai which gave me the courage.



y VenFx > May 15, 2017 12:17 AM | Report Abuse

Manmy, One belt One Road and China's determination to level up its Major Tech as a global player at least can Cheer for the region for 10-20 years.
15/05/2017 00:50
stockmanmy Choo Bee is just a trader, buy and sell and principally to housing developers....nothing there.


by probability > May 15, 2017 12:24 AM | Report Abuse

Mycron's steel tubes had expanded overseas... if you see their steel tube products (refer catalogs) - its of international standards unlike Choo Bee...but imagine if even Choo Bee is already exploring Foreign markets...
15/05/2017 01:00
probability you are incorrect X-men...it has two segments - trading and tubes manufacturing. My message is...if even Choo Bee is already exploring Foreign market with its simple low end tubes...what about Mycron of international API, ANSI, DIN standards?
15/05/2017 01:06
stockmanmy Mycron looks good except it is a Bumi company. But this round, I also have Mycron

Steel manufacturing companies benefit from lower prices of raw materials, relieve from Megasteel monopoly and duty protection.

Choo Bee suffers from stock losses as prices come down and disappearance of their developers market in 2017.

Steel shares mostly look good ...even Hiap Tek and YKG can show turn around this year. Steel shares I have are Mycron, CSC, Ann Joo and Hiap Tek.
15/05/2017 01:09
probability ok good to know that X-men...looks like you are harnessing X-energy very well...may the force be with you.. good night.

Posted by stockmanmy > May 15, 2017 01:09 AM | Report Abuse

Mycron looks good except it is a Bumi company. But this round, I also have Mycron

Steel manufacturing companies benefit from lower prices of raw materials, relieve from Megasteel monopoly and duty protection.

Choo Bee suffers from stock losses as prices come down and disappearance of their developers market in 2017.

Steel shares mostly look good ...even Hiap Tek and YKG can show turn around this year. Steel shares I have are Mycron, CSC, Ann Joo and Hiap Tek.
15/05/2017 01:11
probability http://www.theedgemarkets.com/article/mycron-actively-considering-us-uk-export-markets
15/05/2017 01:20
cheated KC Chong is well known for his attack on KYY. Has i3 members heard about him in real life? Where can find his name ah? We know him as 1 of the boastful i3 forumers. How rich is him?
15/05/2017 04:35
cheated So we better agree on who make more money.

Posted by probability > May 14, 2017 11:57 PM | Report Abuse
ha ha...KC always have a different opinion than KYY..
15/05/2017 04:40

Tips for Dividends Investing: A sure cash flow for investors kcchongnz

Author: kcchongnz   |  Publish date: Sat, 6 May 2017, 12:29 PM


 

Many people love regular incomes, especially the retirees who wish to have regular monthly incomes for food, travel and other indulgence in their retirement life. Most investors also love regular income in the form of dividends. Dividends stocks normally form the backbone of their portfolios, providing a steady income through both the good times and the bad.

 

“Revenue is vanity. Profit is sanity. Cash (dividend) is reality.”

 

Why is dividend important

“A stock dividend is something tangible-it is not earnings projection; it is something solid, in hand. A stock dividend is a true return on the investment. Everything else is hope and speculation.” Richard Russell

 

Dividend is a real thing. You get 38 sen per share dividend from investing in Perstima a year, or a dividend yield of 5.1% at a price of RM7.50 now. You pocket it, use it for consumptions, or reinvest in the same or other shares and in return, get more dividends.

 

During the bear market, Perstima may go down to RM5.00, but you would not feel too scare as the dividend yield then is 7.6%, more than twice from what you can get from bank fixed deposit. In other words, it can provide a “floor” for share price when bear stampedes, and you won’t get too worried and still be able to sleep well.

 

When the market is too hot, dividend yield keeps us in close touch with the real world. In Bursa, someone pointed out correctly that I won’t invest in a company which incurred huge losses and never pays a dividend, just with the hope that it will earn a lot of money in the future. Think about it, what is my protection when the projection, if any, doesn’t turn out as expected, and without a sen from return of my investment?

 

Finally, dividend yield prevents you from being side-tracked by events which have little or no real benefits to you as a shareholder, such as bonus issues, share splits, free warrants, property injections by major shareholders, merger and acquisition and other meaningless corporate exercises, high growth, and getting of big contracts which keep on losing money like before etc.

 

Why not capital gain?

But why haven’t I talk about capital gain? Isn’t capital gain also important as it is the second part of the total return equation?

 

Capital gain = PE expansion + Earnings growth

 

Capital gain is of course important, hopefully it is more due to the second part of the equation, the earnings growth which is more dependable, rather than PE expansion due to market environment. The share price will go up because of the growth earnings and hence in dividend. As there is a growth in earnings, and it may follow by PE expansion too. The management must manage the company well so that the company can pay growing dividends.

 

Does buying high dividend stocks always work?

Not really. Picking the dividend stocks is a tricky process. You should never chase yield because such a strategy may end up costing you more than you ever stood to receive in dividends.

 

For example, if a company with a dividend yield of 5% suddenly decides to cut its pay-out due to decrease in earnings in half, the stock could fall by as much as 50%.

Table 1 below shows that if you have purchased HBGlobal with a dividend yield of 6.9% on 30/5/2012, you would have lost a whopping 80% as on 5th May 2017, while the broad market has gone up by about 24% during the same period. AEGB, the former high flier Master Skill Education Group suffered the same fate with 80% loss. Even a seemingly good stock, JCY is not spared with a loss of 50% over the last 5 years, when it was trading at high price of RM1.50 and giving 15 sen dividend then.

 

Table 1: Return of high dividend stocks in 2012

 

HBGlobal and AEGB have been making losses, huge losses, and obviously, no more dividends have been distributed since then. The dividend for JCY has cut by two thirds now with a dividend of just 5 sen last year. These are extreme examples, but it shows how damaging chasing yield can be to your portfolio.

 

However, if one carries out a few checks while embarking on this high dividend yield investing strategy, he can have some amazing positive results.

 

My experience in dividend investing strategy

Dividend yield investing strategy is one of my favorite investing strategies, together with the Magic Formula. I would talk about dividend yield and the sustainability for all my investment thesis. I would like to share here my experience in this strategy.

 

At the end of year 2015, I have chosen and summarized 5 dividend stocks to share in i3investor as shown in Table 1 in the Appendix. These are a few checks I used as below, which I think anyone following this strategy must carry out to ensure the success of the strategy:

 

  1. Dividend yields at least two-thirds the bank fixed interest rate, currently average about 3.0%.
  2. Dividend pay-out ratio should be less than a cut-off, say 65-85% so that there is money left and the business can still grow with the reinvestment for potential increase in future dividend.
  3. Reasonable expected growth rate in earnings at least matches the overall economy, say >4%, also for the potential growth in dividends in the future.
  4. Strong balance sheet with high excess cash for sustainability of dividend payment. With high excess cash, even during the economic downturn, the company is still able to pay good dividends, while continue to reinvest for growth.
  5. High return of equity and capitals > 12% such that the dividend payment is not only sustainable, but grows from internally generated funds, rather than from borrowed money, and issuance of additional shares which will dilute earnings.
  6. Good free cash flows from where dividend is paid from internally generated funds, rather than just obscure accounting earnings.

 

These investment theses were published in i3investor about 1 1/2 years ago as shown in the link below,

 

http://klse.i3investor.com/blogs/kcchongnz/92727.jsp

 

All stocks met the criteria as stated above, except for Scientex, with a negative net cash.

 

This portfolio of 5 stocks has gained an average of 67.4%, with approximately the same median return, for the last one-and-a-half-year period as on 5th April 2017 as summarized in Table 1 in the Appendix, compared to the gain of the broad market of just 3.8% during the same period.

 

The higher gainers came from those stocks with lower payout ratios, yet with high enough dividend yield of more than 4% when they were picked, such as Scientex (+130%) and Padini (+118%). Although Scientex had a net borrowing in its balance sheet, it has stable earnings and consistent good average free cash flows of 33 sen per share then, almost three times its dividend payout of 12.5 sen. Both Scientex and Padini have high ROEs, and hence adequate internally generated funds to pay dividend, and high expected growth potential.

 

The checks were used to ensure that the stocks picked with this strategy have stable earnings and cash flows, and healthy balance sheet, and high return on capital for the sustainability of dividends. This also provides the safety in the investments with the principle of,

 

Take care of the downside, the upside will take care of itself”.

 

This was evidence by the extra-ordinary high gains of four of the stocks chosen and the absence of any loser in the portfolio over the last one and a half year.

 

Figure 1 below shows dividend growth is a key but often overlooked component of dividend analysis.

 

 

The companies above, though paying high dividends, had low pay-out ratios as shown in Table 1 in the Appendix, and hence there is scope to reinvest retained profits at higher return of capital, for increased dividends in the future.

 

Conclusions

I have shown fundamental value investing works very well for me in Bursa as shown in my latest article here on Magic Formula investing.

 

http://klse.i3investor.com/blogs/kcchongnz/119863.jsp

 

Investing in high dividend stocks is another high winning but low risk FVI strategy if you can separate the chaff from the wheat.

 

However, it is very difficult to convince others to follow the fundamental value investing, FVI, just like what Seth Klarmen used to say,

 

In value investing, either you get it, or you don’t”.

 

Few retail investors follow FVI. It is hard work for them. Most of them are sceptical about it. Even for fund managers, surprisingly, only about 5% of them use FVI, according to a successful fund manager in the US, Jean-Marie Eveillard, even though it has proven that it is a viable investment strategy. Just like most people, fund managers have no patience, and they simply can’t afford to follow FVI through as it jeopardises their career, as FVI requires patience, and understandably, few have patience.

 

The above are some of the reasons why FVI still works, and it works all the time. It even works better in a less efficient market such as that of Bursa.

 

Hence if one wishes to be more successful than the average of the investing community, he must be different from the crowd, learn about the FVI, and dwell in the forgotten and beaten tracks,

 

http://klse.i3investor.com/blogs/kcchongnz/120190.jsp

 

Avoid listening and following hot tips, hopes, hypes and fads. These are the very reason that more than 80 or 90% of retail investors lose money in the stock market.

 

For those who are keen to learn FVI to build up your wealth, you may contact me at

 

ckc13invest@gmail.com

 

You will have some good stocks selling at reasonable prices to invest to build up wealth in the long term, safely but surely. At the same time, you will learn about the magic of FVI, at your own place and time.

 

Tis goeth down to a fundamental aspect that “An investment in knowledge pays the best interest”- Benjamin Franklin

 

K C Chong

 

Appendix

 

Table 1: Return of dividend stocks as on 5th April 2017

  12 people like this.
 
Alex Foo but ah, im small fry trader only. my family waits for me to pay bills, how? dividend need to wait so long and i can't grow my capital =(
06/05/2017 16:39
walau2u Kc, how about your prkcorp? Tq
06/05/2017 17:46
greatnz hi kc, thanks for your sharing. readers would benefit more by reading your articles, rather than those hot tips.

i have been following u for the last 3 years. i have a small request. could you do a write up about focus lumber? because it is in your Stock Pick 2017 and we would like to know more about the fundamentals, ROIC etc. thanks again.

have a good weekend.
06/05/2017 17:54
greatnz hi kc, thanks for your sharing. readers would benefit more by reading your articles, rather than those hot tips.

i have been following u for the last 3 years. i have a small request. could you do a write up about focus lumber? because it is in your Stock Pick 2017 and we would like to know more about the fundamentals, ROIC etc. thanks again.

have a good weekend.
06/05/2017 17:54
speakup KC, what is your opinion of BPLANT which consistently pays about 8% dividend/year?
06/05/2017 17:56
stockmanmy Wall Lone Buffalo very smart...he asks other CEOs to pay dividend , he himself never pays dividends.
06/05/2017 18:50
3iii 1. Buy good quality growth stocks with durable competitive business advantage 2. High ROE of > 15% 3. High quality earnings that translate into large cash flow from operations. 4. Minimal cap expenditure, preferably < 25% of cash flow from operation, that is, high Free Cash Flow 5. Since company is growing its revenues, and earnings yearly, its FCF too grows as well 6. These companies generally has little debt, large cash flows and can play dividends. 7. Dividend payout ratio preferably between 30% to 70%, though companies like Nestle and DLady pay out almost 100% of earnings as dividends. Buying these companies is the equivalent of buying an equity bond of Warren Buffett. Your return = Dividend Yield + Growth in Dividends.
06/05/2017 19:06
PlsGiveBonus Bull market time dividend stock is the least favorited and cannot go up
Bear market time dividend stock also need to drop
Talk about value trap by the means of dividend
06/05/2017 19:10
3iii If you have a successful portfolio of these stocks for the long term, how has this benefited you? 1. You would have a significant gains in your portfolio values over this long term period of holding these stocks. 2. The market is volatile, however, during the bear market, the quotational losses in your portfolio is unlikely to result in loss of your capital. These quotational losses were temporary in nature, given the long time frame of your investing. 3. During these bear markets, the dividends you receive from the portfolio attenuate the quotational losses incurred by your portfolio. 4. The growing dividends of your portfolio over the long term provide significant income for your investing. These dividends contribute a good proportion (maybe even 50%) to your total portfolio returns. 5. You would have realised that whatever gains, however large, of those who croak on their short term trading, pale in comparison to your annual dividends received from your portfolio.
06/05/2017 19:13
PlsGiveBonus If anyone is interested in dividend of 5-7% better put in EPF which is sure gain and no way can go down and loss money
Asb also a good alternative.
06/05/2017 19:21
3iii >>>Posted by PlsGiveBonus > May 6, 2017 07:21 PM | Report Abuse

If anyone is interested in dividend of 5-7% better put in EPF which is sure gain and no way can go down and loss money
Asb also a good alternative.<<<

I think you failed to understand KC's article. :-)
06/05/2017 19:25
PlsGiveBonus Dividend isn't useful in bull market
In bear market also drop too
Donald trump say dividend also need to drop
:))
06/05/2017 19:34
musangfoxking aiyoh, in bull market we not interested whether the company is good or not!!! we just want to hit n run!!!!!!!
06/05/2017 19:39
stockmanmy translated...there is a time for every strategy.

This is X factor time




musangfoxking > May 6, 2017 07:39 PM | Report Abuse

aiyoh, in bull market we not interested whether the company is good or not!!! we just want to hit n run!!!!!!!
06/05/2017 19:54
kcchongnz Posted by walau2u > May 6, 2017 05:46 PM | Report Abuse
Kc, how about your prkcorp? Tq

What about Prkcorp?

Haven't you learned a good lesson on a speculative endeavor on risk arbitrage from the article I wrote on it about a long four years ago. It was free too.
07/05/2017 01:14
kcchongnz Posted by greatnz > May 6, 2017 05:54 PM | Report Abuse
hi kc, thanks for your sharing. readers would benefit more by reading your articles, rather than those hot tips.
i have been following u for the last 3 years. i have a small request. could you do a write up about focus lumber? because it is in your Stock Pick 2017 and we would like to know more about the fundamentals, ROIC etc. thanks again.
have a good weekend.

Glad that you found value in my articles. They are free too here.

Focus Lumber is a magic formula stock, high ROIC and low EY. it is also a good dividend yield stock and good cash flows, and with a clean balance sheet.

It is hence a very safe stock to invest for long-term. It is unlikely to go wrong in your investment.

However, it may not be exciting stock which does not have that kind of fantastic growth prospect due to its business nature.
07/05/2017 01:18
kcchongnz Posted by speakup > May 6, 2017 05:56 PM | Report Abuse
KC, what is your opinion of BPLANT which consistently pays about 8% dividend/year?


I have bought this stock a few months ago and earn good dividend and capital appreciation. Still keep it.
07/05/2017 01:20
kcchongnz Posted by PlsGiveBonus > May 6, 2017 07:10 PM | Report Abuse
Bull market time dividend stock is the least favorited and cannot go up
Bear market time dividend stock also need to drop
Talk about value trap by the means of dividend


Haven't I shown you that the share prices of those dividends stocks in this article that they have gone up in the bad market in 2016, and that they continue to go up during the bulls in the first three months of this year?

What value trap you are talking about?

What evidence you have for your statement?
07/05/2017 01:22
kcchongnz Posted by 3iii > May 6, 2017 07:25 PM | Report Abuse
>>>Posted by PlsGiveBonus > May 6, 2017 07:21 PM | Report Abuse
If anyone is interested in dividend of 5-7% better put in EPF which is sure gain and no way can go down and loss money
Asb also a good alternative.<<<

I think you failed to understand KC's article. :-)

3iii, you are right. i also mentioned in the article this,

“In value investing, either you get it, or you don’t”
07/05/2017 01:26
kcchongnz Posted by musangfoxking > May 6, 2017 07:39 PM | Report Abuse
aiyoh, in bull market we not interested whether the company is good or not!!! we just want to hit n run!!!!!!!


Good on you and best of luck, real luck. You need it. Don’t go out without it!
07/05/2017 01:28
kcchongnz stockmanmy translated...there is a time for every strategy.
This is X factor time

Yeah, in bull market, "dynamite investing."

In bear market,"panic moment".

whatever they mean!
07/05/2017 01:38
greatnz Kc, your stock pick is in The edge magazine today!

http://klse.i3investor.com/blogs/greatnz/122310.jsp
07/05/2017 14:10
stockmanmy you see...you are so wrong kc......

it is only in prolonged bear markets, that ratios, and formulas and bankruptcy tests based on audited accounts are invented and plays a significant role...

for now, people are better off reading the whole Annual Report, news and valuations of X factors.


===================




kcchongnz > May 7, 2017 01:38 AM | Report Abuse

stockmanmy translated...there is a time for every strategy.
This is X factor time

Yeah, in bull market, "dynamite investing."

In bear market,"panic moment".

whatever they mean!
07/05/2017 14:16
PlsGiveBonus Most banking stock and tech stock is having most powerful bull run in the century which never been seen before, none of them seem to follow value investing rule
:))
07/05/2017 14:23
stockmanmy carry on...you are on the right track.....


PlsGiveBonus > May 7, 2017 02:23 PM | Report Abuse

Most banking stock and tech stock is having most powerful bull run in the century which never been seen before, none of them seem to follow value investing rule
:))
07/05/2017 14:26
PlsGiveBonus Most powerful bull run stock in Dow Jone
Tech stock Apple Google Amd Nvda Fb...
Banking Jpm Wfc Bac C ...
Crypto currency : Bitcoin, ethereum, ripple,...
07/05/2017 14:30
PlsGiveBonus It is a waste of time to miss this bull run and betting on stock that cannot go up
:X
07/05/2017 14:35
stockmanmy Value investors did not do well this year.

kc also no business.

I hope things will change for the better for him.

in the meantime, I stick to X factor.
07/05/2017 19:47
stockmanmy bitcoin, enormous run.
07/05/2017 19:48
PlsGiveBonus Wall run but fat also invest in Bitcoin
Wall run but fat is a flipper
:DD
While he teach you to buy value stock which is rigged to look good, rigged by his team. To trap the poor that believe in value, while he get richer and richer selling it.
07/05/2017 20:43
stockmanmy did he?
I always knew Wall Lone speaks from both sides of his mouth.

PlsGiveBonus > May 7, 2017 08:43 PM | Report Abuse

Wall run but fat also invest in Bitcoin
07/05/2017 20:45
stockmanmy Wall Lone likes to tell other CEO to pay dividends but he never pays a single sen.
07/05/2017 20:46
stockmanmy valuations of audited accounts can be taught in universities and become popular memes.

but it is valuations of X factors that are priceless.
07/05/2017 20:53
PlsGiveBonus Who is rich enough to invest in it?
The world richest man
Who is the world richest man?
it is hard to not believe he is not into it while most of his peer who is richest too also involved into it.
Well it is surprising he also involved into gold flipping very long ago.
:DD
07/05/2017 20:55
sell 194) kcchongnz +13.5%

Ranked 194 also must promote loud-loud? Why top 3 no promotion like KC?
07/05/2017 21:00
kcchongnz Posted by stockmanmy > May 7, 2017 08:53 PM | Report Abuse
valuations of audited accounts can be taught in universities and become popular memes.
but it is valuations of X factors that are priceless.


Valuation of audited accounts?

What is that,Mr Accountant?????

Got teach "valuation of audited accounts" in university kah?

Valuations of X factors? You have written thousand times. What the hell is that? X factors? X factors? X factors priceless?

OMG, I am a head full of dew water!!!!!
07/05/2017 22:14
kcchongnz Posted by sell > May 7, 2017 09:00 PM | Report Abuse
194) kcchongnz +13.5%
Ranked 194 also must promote loud-loud? Why top 3 no promotion like KC?

Is there anything wrong of obtaining 13.5% in 4 months?

Promote loud-loud? Got sound ah? Promotion of what?
07/05/2017 22:17
stockmanmy Billionaire Mark Cuban bought a lot of bitcoins at the low.
He didn't need audited accounts for that.
07/05/2017 22:29
kcchongnz Posted by stockmanmy > May 7, 2017 10:29 PM | Report Abuse
Billionaire Mark Cuban bought a lot of bitcoins at the low.
He didn't need audited accounts for that.


Buying bitcoins need audited account one ah? What kind of account is required, Mr Accountant?
07/05/2017 22:36
ttwong Hard to resist the "social proof". money game come into my mind.


During the Berkshire Hathaway’s annual shareholders’ meeting, a value investor from China asked Buffett and his right-hand man Charlie Munger for advice on how to spread the value investing philosophy in a market system where so many are speculating.

“There’s always some speculations, always some value investors in the market,” Buffett said.

The problem arises when people start to see others benefitting from playing the market.

“When speculation gets rampant and when you’re getting what I guess Charlie [Munger] would call ‘social proof’ that it’s worked recently, people can get very excited about speculating in markets. And, we will have it from time-to-time in the market,” Buffett said, adding, “There’s nothing more agonizing than to see your neighbor, who you think has an IQ 30 points below you, getting richer than you are by buying stocks, whether it’s internet stocks or whatever. And people succumb to it. They’ll succumb to it in this economy and elsewhere.”
07/05/2017 22:52
stockraider Warren Buffet and Charlie munger says....bcos mkt got many speculators and gamblers in a way give alot of opportunity for value investors loh....!!

But value investors need to be discipline and not to succumb to speculative frenzy and stick to time tested value investment loh..!!

Kc is a good testament what value investment should be mah...!!
07/05/2017 23:10
keke Whenever temptation is getting stonger and stronger, I just remind myself that there are certain type of money out there which are not for me to earn.
07/05/2017 23:28
stockmanmy tip for you...don't buy any thing that makes you nervous. No point one even if it skyrockets after you have bought.
Buy whatever makes you calm.
but
X factor will continue to be a very important of share price for the rest of 2017.




keke > May 7, 2017 11:28 PM | Report Abuse

Whenever temptation is getting stonger and stronger, I just remind myself that there are certain type of money out there which are not for me to earn.
08/05/2017 02:18
samsambank Hexza
08/05/2017 06:23
PlsGiveBonus Total crypto currency market cap is officially now 52.558 bn USD, or over 200 bn myr worth of market cap, it is more worthy than all klci components plc combined.
:DD
08/05/2017 22:00
stockmanmy US$50 billion and still no guarantee of security yet.
08/05/2017 22:20
PlsGiveBonus It is one of the best investment you can find in this decade
practically you do not spend money to get it, and it compound into a lot of wealth.
Take it for granted work every time
The last time piece of land is very abundant wealth, a lot of people take it for grant with no money down, now they enjoy the wealth from the piece of free land.
08/05/2017 22:49
stockmanmy but still got hacking and people lost their bitcoins.
08/05/2017 23:07
Yippy68 it is the dividend that made me rich as today. thank kc . i invested in reit for 9 years , with dividend and capital gain , and bplant after it dip to 1.25...i collected huge return from them. no one will believed.
13/06/2017 06:57
kcchongnz Posted by Yippy68 > Jun 13, 2017 06:57 AM | Report Abus
it is the dividend that made me rich as today. thank kc . i invested in reit for 9 years , with dividend and capital gain , and bplant after it dip to 1.25...i collected huge return from them. no one will believed.

Congrats Yippy.

That is partly what business sense is about.

Some others think that they have this, but they can't even articulate what it is. it is merely a business nonsense.
13/06/2017 08:28

Basing on audited account to pick stocks is unreliable? kcchongnz

Author: kcchongnz   |  Publish date: Wed, 3 May 2017, 01:23 AM


I read with great interest an article in i3investor titled,

Just Basing on Audited Accounts to Pick Stocks is Unreliable – Suzn” in the link below,

http://klse.i3investor.com/blogs/suzinaidu/121946.jsp

Really? What research does he base on, or just a sweeping statement?

 “What Has Worked in Investing” published by a famous US investment company Tweedy Browne has gone through vigorous research and provided you with the methods which have worked in the past and are still working very well today. Those methods were generally based on accounting metrics such as price-to-earnings ratio, price-to-book, price-to-cash flows, dividend yields and all those metrics used by value investors, the school of thought of Benjamin Graham.

Yes, those earnings, book value, cash flows, dividend etc. are all from audited accounts. Of course, they are not plucked from the sky, and they are not gotten through the crystal balls of the snake-oil salesmen.

In a paper titled “The Super Investors of Graham and Doddsville”, Warren Buffet showed the track records of each of nine disciples of Benjamin Graham showing that they all generated annual compounded returns of between 18% and 29% over track records lasting between 14 to 30 years.

Let’s have a look at their profit history in Table 1 below.

 

Table 1: Return of value investors

Investor

No. of Yrs

Annualised

    Return

S&P / Dow

    Return

Buffett Partnership

     13

     29.5%

  7.4 % (Dow)

Walter Schloss

     28

      21.3%

   8.4%

Tweedy Browne

     16

      20%

   7%

Bill Ruane

     14

      18.2%

   10%

Charlie Munger

     14

      19.8%

    5.0% (Dow)

Pacific Partners

     18

      32.9%

    7.8%

Perlmeter Investments

     18

      23%

    7.0 % (Dow)

These super investors achieved fantastic returns basing purely on the audited accounts. So how can you say, “Just Basing on Audited Accounts to Pick Stocks is Unreliable”? Which research you are basing on?

Take for example, Walter Schloss who practised deep value asset based investing using the balance sheet, $10000 invested 28 years ago in his time yielded $2.23m at a compounded annual rate, CAR, of 21.3%. This is 23 times more than if one were to invest in the broad S&P500, returning a CAR of 8.4%.

Joel Greenblatt of the Magic formula fame, used two accounting ratios; Return on invested capital and earnings yield, and carried out quantitative investing. He outperformed S&P 17 out of the 22 years and achieved a compounded annual growth of 23.8% as compared to the 9.6% of S&P. $10000 invested 22 years ago in 1988 has grown to 1.09m by the end of 2009, even after the US sublime crisis in 2008-2009. This is by no means a small feat compared to the same amount invested in the broad market which only grew to $75100 during the same period.

In his latest book, “The value Investors, Lessons from the World’s Top Fund Managers” published in 2012, Ronald W. Chan interviewed twelve top fund managers from US, Europe, and Asia using various forms of value investing expounded by the Super Investors of Graham and Doddsville, such as PE ratio, P/B, P/CF, DY etc. The evidences showed it has worked all over the world.

Many other super investors used audited account and made judgment in their investing and obtained extra-ordinary return over a long period of time. Those methods are logical and intuitive, and I don’t see why they are unreliable and should not work.

 So how can you say, “Just Basing on Audited Accounts to Pick Stocks is Unreliable”? Which research you are basing on?

 

The said article went on to say that,

I noticed that many novice investors openly tell other investor to sell off counters that had company reported losses from last year. As an investor, before giving out any 2 cents opinion or advise to others, we must first examine our own track record to see why we are not making money in the first place.

The above statement sounds more like some kind of “Golden Rule” of investing. I don’t know who was the one who has been propagating and advising other people.

The author further said,

Secondly, to be a successful investor, we must at least have some practical sense on how a business works. We must first look at the future development of the company and their profit growth prospects.” 

Jaks and Sendai were used “As a references of counters that has churned profit without mirroring its previous QR results;”

Not sure how the author already knew Jaks and Sendai have “churned profit”.

However, the author mentioned the huge investment outlay Jaks and its China partner have to come up, but did not quantify the “tremendous profit growth” it will achieve, and how much is the present value of this project, what is the internal rate of return of this project attributed to Jaks, disregarding its huge losses in its property development and local construction works.

More importantly, nothing is mentioned about the risk of this power plant project. The risks could be currency risk, inflation risk, partnership risk, bureaucracy risk, execution risks, political risk, social and environment risk, foreign country risk etc. You name it.

Haven’t we seen that in Mudajaya’s foray into power plant development in India? By the way, how many Malaysia construction companies had made profits in overseas construction job?

 

For Sendai, the author described the track records of Sendai in constructing big projects overseas. But did they make money?

The author relies on the MD of Sendai on the amount of projects the company has secured. I did hear many good stories from the CEO or MD of some construction companies before but the actual outcome turned sour, such as one company starts with K. There is another construction company starts with V, which has secured billions of jobs and also with a Chines partner. Its MD went around telling all the investment banks how undervalued was its stock, but still the share price cannot go up. The pertinent question should be, are they going to make money from the huge number of projects they have? I personally have no idea.

I have read articles before mentioning that construction is not an easy business with so many problems. The industry is a dog-eat-dog world. If a company get projects from competitive tenders, likely they are not going to make money. That was what I have read from the industry expert. I, being a civil engineer for many years working in the construction industry, do agree with this.

So, is Sendai guaranteed making big money from its huge order book or not? What was its track record?

The author also mentioned this at the end of his article,

There are some Sifu who will never recommend his followers to buy JAKS and Eversendai because he relies too much on audited accounts and does not look at the company’s business and growth prospect. That is why they misses the opportunity to buy stocks which have been shooting up like rockets.”

Sounds very familiar. I personally do not invest in stocks which have not shown good track records, but I in no position to advise others to invest, or not to invest. In construction, capability and track records are paramount important as we already knew the difficulties in constructions. Well, if others want to invest in them, that is their prerogative.

One thing for sure, for an illiquid stock, it doesn’t need many million to jack up its price from continuous buying. It will continue to go up in price if there are enough fools to follow. It will be self-fulfilling. The problem is, you won’t know when the music stops. The clock in the room has no hands.

By the way, there are hundreds of stocks in Bursa. You aren’t a “low class” investor if you don’t buy Jaks, or Sendai. There are plenty of opportunities in Bursa, stocks with high potential to go up, and come with little risk.

Finally, I do not think one must show he has a lot of money, or must be substantial shareholder of companies, to be able to express his opinion here.

Oh yeah, I personal have been obtaining satisfactory return over the long term with my study of audited account, and have avoided a lot of pitfalls in investing, as shown in my various articles, records in i3investor.

if one wishes to pursue my way of investing, you may contact me at

ckc13invest@gmail.com

It is my passion to propagate value investing.

KC

 

  13 people like this.
 
abang_misai Ini KC betul-betul Kwai Lan.
03/05/2017 04:37
YLR33 very good article
03/05/2017 05:10
king36 YLR33

Agreed. Always something to learn from KC.

Thanks.
03/05/2017 05:14
supersaiyan3 Agree
03/05/2017 05:46
soojinhou There's even a purported trading champion who says he dislikes holding a company through the release of financial report. He even sells subscriptions. For ppl like him who disregard financial analysis, I hope some day they meet the ultimate pump and dump master John Soh. Then only they will learn their lesson.
03/05/2017 06:19
optimus9199 good write up KC...this KYY is really trying to mislead the readers by following his own delusion.. BUt i cant blame him as he already have Alzheimer dz and wont live long also. Just forgive him for his dz pls.
03/05/2017 06:32
paperplane2016 Kwai LAN.Hana
03/05/2017 06:43
Icon8888 Same as KC, I have reservation about Sendai

Bought at 60 Sen, but after study carefully it's track record, noticed it was very bad at generating profit in the past. Gave me an impression that it's capability of securing huge amount of contracts is actually the other side of the same coin - you bid so competitively until you can't make money out of the projects.

So I sold off at 60 Sen (broke even)

Fair enough , it has gone up to 90 Sen+, but for me, I am guided by KYY's own golden rule that if I not convince that it can make more money in future (bearing in mind market cap not small), I don't buy

Maybe KYY has insider info ? Maybe he spoke to the MD ? I don't know.

I have no regret. Sometime if certain money is not for you to make , it is not for you to make

Sticking to KYY Golden Rule caused me to miss out on sendai but on the other hand, it will also help me to make lots of money in other cases and also avoid huge losses (lemons)

You can't have your cake and eat it too. Welcome to the real world !!!
03/05/2017 06:44
paperplane2016 Icon, don't catch you. You said kyy golden rule. Tell me why then kyy never sell xingquan. His golden rule is a rule of what he himself alsodid not follow.
03/05/2017 07:02
Icon8888 I follow a principle, not a personality

That person can screw up, but the principle can be valid and lasting
03/05/2017 07:11
John Lu Ck so Kuai Lan and Kuai Ku
03/05/2017 07:27
stockmanmy kc


the most profitable trades / investments come from taking a risk, and proven right later....turnarounds are one of them.....


since whatever is in audited accounts is all public knowledge and historical records, ...and share price is about the future.....and the internet revolution speeds up the spread of information...the world of Benjamin what ever and the Wall Lone Buffalo is so 20 century....when people never learn how to take risk, they are better off buying Index Funds.
03/05/2017 09:48
stockmanthekoonman So what differentiates you from a gambler?
03/05/2017 10:12
stockmanthekoonman What if proven wrong?

i.e. Mudajaya, Jayatiasa
03/05/2017 10:13
stockmanmy know your bet.....know what you are betting on...have an opinion on what is a favorable outcome.

the stock market exists to encourage people to assume risk and be rewarded for taking risks and later proven right....that is how the economy functions at its best.

must read whole Annual Report , and the news not just audited accounts, have an informed opinion ...and place your bets.


stockmanthekoonman > May 3, 2017 10:12 AM | Report Abuse

So what differentiates you from a gambler?
03/05/2017 10:16
stockmanmy proven wrong, lose money....that is proper and correct.




stockmanthekoonman > May 3, 2017 10:13 AM | Report Abuse

What if proven wrong?
03/05/2017 10:17
stockmanmy In the case of Nylex, no matter how deep is the discounts to NTA and audited accounts, ....

if chemicals recovery is the bet ( the unique selling proposition) and don't know how good it is...then no bet can be made............

Sendai offers recovery story and deep discounts to NTA, Nylex offers what?
03/05/2017 10:33
stockmanthekoonman Assuming calculated risks is one thing.

Assuming risks fueled by perceptions and emotions, is a completely different thing. To the contrary it can be very much harmful.

to quote the old man, minus the emotions and irrationality the market will be fairly priced. Knowing when the market is unfairly valuing a stock is the way to go. Not by trying to predict the future.

Unless you have insider info.
03/05/2017 10:39
stockmanthekoonman A track record.


Sendai offers recovery story and deep discounts to NTA, Nylex offers what?
03/05/2017 10:40
stockmanthekoonman On the chemicals play as i'm not an expert in it.

But there is a trend there which you cannot deny.
03/05/2017 10:43
stockmanthekoonman Kyy certainly had his days. But he's getting reckless.


Double or nothing.
03/05/2017 10:52
stockmanmy Bull market, bear market

In a prolonged bear market, the value investors with their accounting ratios, and formulas and bankruptcy tests are born. The tool...the audited accounts.

In a bull market as currently, it is growth and catalysts

Those not flexible are left in the dust, biting the dust....Investors / traders should be flexible while holding steady. Must adapt without being nervous.

Turnarounds ( Sendai) and new businesses ( Jaks) are good choices in current market environment.
03/05/2017 12:26
stockraider Holly Grail of investment in long run, value investment always wins just look at Nestle, Dlady, Pbank, Maybank, Genting always show increasing return even....during deep recession...it always bounces back with great strength loh....!!

So value investor....must always pick stock with big margin of safety and with good sustainable prospect & not manipulated & promoted speculative goreng stock like Jaks & eversendai loh.....!!

Don get con loh.....!!
03/05/2017 12:34
stockmanmy The Wall Lone Buffalo is not what he seems
He has been a sailang man all his life, with a good business sense.......borrowing money from friends and relatives to sailang all into a bankrupt textile company. That is how he got his first break in life. ...and he is no accountant.

A lot of people now tries to make a living out of the Wall Lone Buffalo name...but what can be taught become popular memes, it is what cannot be taught become priceless.

ps.....not to worry., I will guide you all along and it is all FOC.
03/05/2017 12:40
Wealth_seeker well written, kc, as usual.
03/05/2017 14:02
stockmanmy too bad

smooth writing makes no money

taking the right risk makes the money.

y Wealth_seeker > May 3, 2017 02:02 PM | Report Abuse

well written, kc, as usual.
03/05/2017 14:11
stockmanmy don't talk nonsense...good shares don't come cheap...and certainly no huge discounts to NTA

good stuffs not cheap
cheap stuffs not good.


y stockraider > May 3, 2017 12:34 PM | Report Abuse

Holly Grail of investment in long run, value investment always wins just look at Nestle, Dlady, Pbank, Maybank, Genting always show increasing return even....during deep recession...it always bounces back with great strength loh....!!

So value investor....must always pick stock with big margin of safety and with good sustainable prospect & not manipulated & promoted speculative goreng stock like Jaks & eversendai loh.....!!

Don get con loh.....!!
03/05/2017 14:50
stockmanmy steady , calm and willing to back up his opinion with his own money...no wonder KYY is the maverick.

this raider, nervous, value investor, always scared, needs his margin of safety fails in the game.........

you have to ask why?
03/05/2017 15:06
kcchongnz Posted by stockmanmy > May 3, 2017 09:48 AM | Report Abuse
kc
the most profitable trades / investments come from taking a risk, and proven right later....turnarounds are one of them.....

You are really an eccentric fellow. You talk so much about “sailing”, taking risk etc. but without knowing what “risk” is.

That for example, you talked about investing in Jaks nowadays so much as if it is the investment of the century. Have you quantified what the return will be? have you measured what the risks are?

What is its return versus its risks? Or what is the return per unit risk?

Are you happy if you “sailing” for an investment with the potential return of say 12%, but the risk of losing all is 80%, or a return per unit risk of 0.15?

When you “sailing” an investment now, with the risk of losing all, you only hope that it will be proven right and become “the most profitable trade” without knowing what your return is likely to be, rather than doing a probabilistic study?

Some more make a statement as below?

Posted by stockmanmy > May 3, 2017 12:40 PM | Report Abuse
A lot of people now tries to make a living out of the Wall Lone Buffalo name...but what can be taught become popular memes, it is what cannot be taught become priceless.
ps.....not to worry., I will guide you all along and it is all FOC.

I really don't know what to say about you.
04/05/2017 00:08
stockmanmy kc

people sailang $ 200 million in it....That is what sifu means.

People got guts...they drive Rolls Royce, they earned it.
04/05/2017 00:20
Apollo Ang when the nobody got guts he/she loses all their money cos if a nobody buy a lot,the insider people will push it down. bursa is not an open market,mustn't sai lang.unless u r a politician or some big shot only can sai lang.wanna invest big must invest elsewhere not bursa
04/05/2017 00:25
cheoky sorchai manny only look at one outcome of all possible outcomes. Ask us to focus on that outcome. Go all out for the outcome, not knowing luck will run out one day. Newbie like me can also see the stupidity of this manny thought. Manny pls go back fly kite. You very lonely? No grandchildren to absorb your teaching?
04/05/2017 00:29
stockmanmy People got $ 200 million in the game , sailang....I think that is the real meaning of sifu
He drives Rolls Royce, he earned it.





cheoky > May 4, 2017 12:29 AM | Report Abuse

sorchai manny only look at one outcome of all possible outcomes. Ask us to focus on that outcome. Go all out for the ou
04/05/2017 00:37
stockmanmy a real piece of gem..................

Bull market, bear market

In a prolonged bear market, the value investors with their accounting ratios, and formulas and bankruptcy tests are born. The tool...the audited accounts.

In a bull market as currently, it is growth and catalysts

Those not flexible are left in the dust, biting the dust....Investors / traders should be flexible while holding steady. Must adapt without being nervous.
04/05/2017 00:39
kcchongnz Posted by stockmanmy > May 4, 2017 12:37 AM | Report Abuse
People got $ 200 million in the game , sailang....I think that is the real meaning of sifu
He drives Rolls Royce, he earned it.

I really shake my head with this kind of mentality. Some more,

Posted by stockmanmy > May 3, 2017 12:40 PM | Report Abuse
ps.....not to worry., I will guide you all along and it is all FOC.

By the way, there is a good article for you to learn something here,

http://klse.i3investor.com/blogs/kcchongnz/121724.jsp
04/05/2017 00:40
Apollo Ang too many insider tradings that derail any individual any chances of being filthy rich. just like last time before china open up their economy
04/05/2017 00:42
cheoky manny is either very lonely in real life or ego need feeding to the extend the surplus energy crooked his mind. my opinion. maybe manny you can join Tzu Chi. Here- http://www.tzuchi.org.my/web17/

Expend out your surplus energy there, not i3.
04/05/2017 00:46
stockmanmy cheoky

a real piece of gem..................

Bull market, bear market

In a prolonged bear market, the value investors with their accounting ratios, and formulas and bankruptcy tests are born. The tool...the audited accounts.

In a bull market as currently, it is growth and catalysts

Those not flexible are left in the dust, biting the dust....Investors / traders should be flexible while holding steady. Must adapt without being nervous.
04/05/2017 00:50
stockmanmy but too bad...cheoky does not have what it takes.
04/05/2017 00:51
stockmanmy cheoky

a real piece of gem.................. you can't comment because you have no idea how the market works, or how to make money.....lol, no kidding.

Bull market, bear market

In a prolonged bear market, the value investors with their accounting ratios, and formulas and bankruptcy tests are born. The tool...the audited accounts.

In a bull market as currently, it is growth and catalysts

Those not flexible are left in the dust, biting the dust....Investors / traders should be flexible while holding steady. Must adapt without being nervous.
04/05/2017 01:51
PlsGiveBonus Account look good
Bear market also need to drop
Diversification also cannot survive in bear market

Low can get lower did work
04/05/2017 13:07
stockraider Warren Buffett can make investing sound easy: Buy stocks when they’re cheap and pretty much hold them forever. And Buffett constantly reminds us of this simple wisdom. Of course there’s a bit more to it than that. Still investors seem to make the same mistakes over and over.CORRECTLOH...EVERGREEN HAS GREAT MARGIN OF SAFETY MAH....!! SO ACCUMULATE LOH....!!

Why is that?
I decided to put that question to Buffett himself during a recent interview at his headquarters building in Omaha, Nebraska.

But first I asked him if he thought people really learned from what he says and actually go out and successfully invest themselves.

“Well, I think some are helped,” Buffett says. “The main thing we wanna give them — Charlie and I feel this way — is the right attitude toward investing. You’ve got a big tailwind if you’ve invested in America over time. A huge tailwind.” U BUY WHEN UNDERVALUE WITH BIG MARGIN OF SAFETY..EXAMPLE EVERGREEN GOT GREAT MARGIN OF SAFETY LOH...!!

Unfortunately, most investors struggle to stay focused on the long-term and react to the short-term, unwittingly making money-losing decisions.YES WE ALREADY KNOW EVERGREEN GOING TO MAKE GOOD PROFIT 30-6-2017 ONWARDS SO MUST START BUYING NOW LOH...!!

“People have certain habits, some proclivities that are self-destructive in investing,” he continues. “So I would say that I hope our main message is to stay away from trying to trade stocks or do things that are kind of self-destructive, and just let America do the work for ’em.” YES DON EVER SELL EVERGREEN JUST HOLD UNTIL SAY 31-8-2017 THAT MEANS RM 1.20 IS IN UR BAG...IT IS THAT SIMPLE LOH..!

And this lead to the question I mentioned initially, which is: What are the big mistakes people make? Why do people get it wrong?

“Well, the big mistake is thinking they know when to buy and sell stocks,” Buffett says with a chuckle. “That there are times to buy ’em and times to sell ’em. There’s times to buy ’em. And eventually maybe, when you decide to start dis-saving when you’re 70 or 80 years of age or something of the sort, at that time you may sell ’em. MISTAKE IS THAT U TRADE THE SHORT TERM LOH...!!
“But basically any attempts to pick the times to buy or sell, I think, are a mistake for 99% of the population. And I think that even attempts to pick individual securities is a mistake for people.”
The attempt to beat the market by tilting asset class weighting and trading in and out of stocks is known as active investing. Buffett recommends passive investing through a “very, very low cost S&P 500 index fund.” IF U R PANLAI....BUT U LOSE MONIES IN STOCK...IT IS BCOS U R NOT TUNE....U HAVE NO APTITUDE IN SHORT TERM INVESTMENT....GO FOR LONGER TERM...LESS ACTIVE...CHOSE STOCK WITH MARGIN OF SAFETY LIKE EVERGREEN AND HOLD LOH...!!

“They don’t need to do anything but that,” he says. “Then they’ll get a decent result over time. To some extent, the smarter you try to be, the worse you do in investments. Now, there’s a few professional investors that will do better than the S&P over time. But the average individual isn’t going to be able to find them. And they don’t need them. That’s the beauty of it.” BESIDE SMARTS...U MUST BE WIRED RIGHT IN ORDER TO BE SUCCESSFUL...UR INVESTMENT ATTITUDE VERY IMPORTANT LOH...!!

No mistaking that.
04/05/2017 13:09
RexGB Anyone know what is the price of KC Chong's online investment course?
04/05/2017 15:07

The Forgotten Tycoons kcchongnz

Author: kcchongnz   |  Publish date: Sun, 30 Apr 2017, 01:36 AM


I read a laugable comment directing at me again by a persistent critic as below,

Posted by stockmanmy > Apr 30, 2017 12:35 AM | Report Abuse Kyy is a tycoon, a maverick investor. They dare to sailang.
KC, if you do not dare to sailang, you should be more comfortable with CFA rules aka as diversification rules.
If you cannot see KYY as maverick investor, you cannot see me as maverick investor. But both of us are The Mavericks.

The Mavericks? A "Sailang" Maverick?

Here I would liketo share an article by Fools, a very good article for everyone to ponder, "The Forgotten Tycoons"

 

The Forgotten Tycoons

     
 
 

Hi Fellow Investor,

We all have role models. Mentors. Heroes. We find those we want to emulate and learn all we can from them, following in their footsteps.

Sometimes that's a dangerous path.

I was reminded of the potential perils of becoming, in today's language, a fan-boy of the rich and famous by, of all people, my role model.

"Thanks for everything you've helped me with," I told an investment writer I've long admired over a recent lunch. "You've been a great mentor."

After all, he's spent years dispensing valuable advice to me on investing, business, and life.

But he was quick to deflect the praise.

"Careful there," he laughed in response.

"What do you mean?" I asked.

"Edgewater, come on. We've talked about this before. Don't jinx me."

Ah, he was right.

"Edgewater" is code for a story that illuminates how careful you have to be when selecting and admiring role models and mentors in the business world.

It goes like this.

Ninety-two years ago, a group of nine of the world's most successful and powerful businessmen met at the Edgewater Beach Hotel in Chicago. Adjusted for inflation, some were billionaires. What others lacked in wealth they made up for in influence.

They were there to celebrate their power, share stories, and team up to dominate the booming U.S. economy.

If there was a roomful of men capable of ruling the world, there it was.

But within 25 years, those nine men ruled nothing:

 

  • Charles Schwab, the president of Bethlehem Steel, died bankrupt.
  • Samuel Insull, a utility tycoon, died penniless after his empire collapsed under phony accounting.
  • Howard Hopson, the president of a gas company, had a mental breakdown and lived in an insane asylum after being convicted of securities fraud.
  • Richard Whitney, president of the New York Stock Exchange, was in prison for embezzlement.
  • Leon Fraser, a banker and lawyer, committed suicide.
  • Arthur Cutten, a commodities investor, died of a heart attacked.
  • Ivar Kruger, who once dominated the match industry, killed himself after going broke.
  • Albert Fall, President Harding's Secretary of the Interior, died shortly after being convicted of bribery.
  • Jesse Livermore, an investor, was nearly broke and killed himself, writing to his wife: "I am a failure. I am truly sorry, but this is the only way out for me."

 

The takeaway is something we take seriously at The Motley Fool:

Choose your role models carefully. Extreme success is often due to luck, not skill or character. Never underestimate the power of one-hit wonders, especially in a field like investing. Personally, I'm interested in people whose success spans a lifetime, across multiple ventures. People like Warren Buffett, Steve Jobs, and Elon Musk. And yes (potentially brown-nosing but honest), Fool co-founders Tom and David Gardner.

Avoid leverage. It doomed many of the nine tycoons. In investing, this means avoiding margin debt when buying stocks. I don't know anyone who has consistently used margin debt and not regretted it in hindsight. I'm actually shocked it's still legal.

Think long term. Gunning for short-term results and the constant desire for more money now took down many of these nine men's fortunes. Markets reward patience more than any other skill.

Reputation, honesty, and accountability matter more than anything. Especially in business. As Warren Buffett once said when a company he ran came under scrutiny: "Lose money and I will forgive you. But lose even a shred of reputation and I will be ruthless."

 

Have a great weekend,

 

 

  7 people like this.
 
VenFx They choose customers ?
Hiw manmy come across this, anyway SCGM has certain moat in the industry.
Recent Titan to be listed in Bursa shall benefit the polymer user giving currently STABLE price to cost.
30/04/2017 23:45
VenFx Luxchem/Superln/Scgm/karyon/spritzer (polymer user)
30/04/2017 23:52
stockmanmy They choose customers, not customers choose them. That is what they tell analysts and it is mainly true.
01/05/2017 00:03
stockmanmy value investors armed with their 20 ratios and 10 formulas , do they know what they are doing or not?
01/05/2017 00:06
VenFx Why bother ? As long your Dynamic view can bring good monies.
SCGM worthy to buy.
01/05/2017 00:15
VenFx What I learned from OTB's selection criteria is , u can always find a small cap before they turn to be a strongest in its field.

While for Dynamically , its more like searching for the Elite Members.
01/05/2017 00:19
VenFx Dynamic investing 易懂难精
01/05/2017 00:20
VenFx Sometimes, its like 八卦阵, can lost inside without proper guidance.
01/05/2017 00:22
VenFx Aeocr
Myeg
Dsonic
Gdex
Ghl
Can this counters come to you while practising Dynamic investing ?
01/05/2017 01:03
poorkid Venfx sifu why Eg not paying dividend is not a problem but a problem in China stocks?
01/05/2017 01:16
VenFx U got to seek Sc why they let the Red Chip coming in lor...
把关不 strict , and less convincing account set ...
So, problem is not on the Div. Only ...got it ?
01/05/2017 01:20
newbie5354 Very unfair only people dig China stocks not paying dividend when many local stocks don't as well.
01/05/2017 01:22
VenFx 这是人性
想要突破
红筹得
走出去
告诉人啊
01/05/2017 01:28
stockmanmy Aeocr
Myeg
Dsonic
Gdex
Ghl

This year, I have made money in AeonCr, MYEG. Gdex and GHL....still have AeonCr.
01/05/2017 02:13
stockmanmy Trading....this is the first time I write about trading. I don't like to write about trading because it is very personal, happens very fast and I don't discuss with anybody....

I prefer to write about dynamic investing because the ideas are more transferable.

Trading is too personalized to be transferable.


In the trading portfolio, the normal profits 10% to 20% per counter...so far this year, my losses are 2 to 3% per counter because I wanted the money to buy some thing else. I try to cut loss and let profits run to 10 to 20% before I sell. As much as possible, I will also like to average up...and average down not so much .

some times, like Southern Steel, it jumps up the day after I sold at cost., because I wanted to buy AAX. In steel , I still have Ann Joo , CSC which are in the money so I sold Southern Steel which is at cost. mainly because it is also my intention to reduce exposures to steel counters because steel raw materials prices are on the way up. The 3 steel counters were purchased the day they extended the duty.

The last few months, It has been very easy making trading profits. It is not going to be like this all the time. As long as no cut loss, as long as got shares, every dog has its day in the last few months...as long as got shares...and every sale transaction is a mistake , pretty much sums up the last few months.


The trick to making money the last few months then becomes....just find the inspiration and guts to buy shares..any share with a theme play...no kidding.
01/05/2017 03:35
soojinhou Stockmanny, u talk too much.
01/05/2017 06:02
stockmanmy go back to your balance ratios and formulas.


soojinhou > May 1, 2017 06:02 AM | Report Abuse

Stockmanny, u talk too much.
01/05/2017 07:20
BornToSpeculate Are we serious. We are comparing the views of uncle KC ( frankly never heard of him in the business world or investment world ) and uncle KYY, someone that no one will deny that understands business and has an impressive track record in the corporate world and also investment.

From what I know about their respective contribution to our forum / investor society

uncle Kyy shares his views and donates millions to charity ? But we criticize him. I wonder how much charity the rest of us do..
Uncle KC apparently preaches investments strategy and charges society for it.

If u claim u are a better investor, earn more and donate more than kyy, u will get our respect
01/05/2017 10:08
stockraider Posted by BornToSpeculate > May 1, 2017 10:08 AM | Report Abuse

Are we serious. We are comparing the views of uncle KC ( frankly never heard of him in the business world or investment world ) and uncle KYY, someone that no one will deny that understands business and has an impressive track record in the corporate world and also investment.
KYY IS AN OUTDATED DINOSAUR BUSINESSMAN...HE RETIRED MORE THAN 20 YEARS AGO...!! IF KYY SO GOOD...WITH GREAT BUSINESS APTITUDE, HOW COME HE LOSE MONEY EVEN IN HIS FORMER OWNED COMPANY LIKE MUDAJAYA ??

From what I know about their respective contribution to our forum / investor society. THIS KYY...IS A CONMAN...IF JUST SEEK SO PUBLICITY WITH LOADS N LOADS CONDITION..HIS DONATION TO TAR UNIVERSITY DID NOT HAPPEN BCOS HE PURPOSELY IMPOSE ALOT OF CONDITIONS UNTIL IT FAILED LOH.

uncle Kyy shares his views and donates millions to charity ? But we criticize him. I wonder how much charity the rest of us do..
Uncle KC apparently preaches investments strategy and charges society for it.YES..UNCLE KYY DONATE MONIES TO SOCIETY....BUT HE DO ILL GOTTEN GAIN BY CONNING STOCK INVESTORS WITH HIS MANIPULATION...WHAT IS DIFFERENT OF HIM WITH DRUG PUSHERS, AND ILLEGAL 4D OPERATORS WHO ALSO DONATE MILLIONS TO SOCIETY ALSO LOH...!!

KC IS A PROFESSIONAL MAKE AN HONEST LIVING...NOT WRONG MAH..!!

If u claim u are a better investor, earn more and donate more than kyy, u will get our respect. AS RAIDER SAY U CON ALOT LIKE KYY...THEN HE DONATE SOME TO SOCIETY OK MAH....!!
KC TEACHES U THE ART OF MAKING MONIES THE RIGHT WAY FOR A FEES...!!
IF U GO TO UNIVERSITY U NEED TO PAY ALOT OF FEES TOO MAH AND ALOT OF PARENTS ARE STRUGLLING WITH THAT MAH...!!

KC ONLY CHARGES AFFORDABLE SMALL FEES....COMPARE WITH KYY CON UR MONIES WITH NO FEES...U TELL ME WHO IS BETTER LEH ??
01/05/2017 10:33
Ooi Teik Bee HIS DONATION TO TAR UNIVERSITY DID NOT HAPPEN BCOS HE PURPOSELY IMPOSE ALOT OF CONDITIONS UNTIL IT FAILED LOH.

Ans : Please be fair in making this statement, the aforesaid statement is not true. MCA refused to accept the terms and conditions imposed by Mr Koon.
The same money (RM 70 million now but not 30 million) is donated to Penang government to build hotel for University students on same terms and conditions.
The objective of this donation is still the same, no change on terms and conditions. Penang government accepted it.

Mr Koon is sincere and wanted to donate this money for charity. I am very fortunate to get involve a bit in this donation. Mr Koon told me before he made this announcement.

Please be fair and not bad mouth his good intention on this donation. I do not wish to side Mr Koon on this matter. I talk with facts and figures and I just tell the true story.

Thank you.
Ooi
01/05/2017 11:16
stockraider Posted by Ooi Teik Bee > May 1, 2017 10:58 AM | Report Abuse

HIS DONATION TO TAR UNIVERSITY DID NOT HAPPEN BCOS HE PURPOSELY IMPOSE ALOT OF CONDITIONS UNTIL IT FAILED LOH.

Ans : Please be fair in making this statement, the aforesaid statement is not true. MCA refused to accept the terms and conditions imposed by Mr Koon. RAIDER VERY FAIR ONE....MCA REFUSE TO ACCEPT THE TERM & CONDITION IMPOSE BY MR KOON LOH...!!

The same money (RM 70 million now but not 30 million) is donated to Penang government to build hotel for University students on same terms and conditions.AS RAIDER READ THE INFO...ON PENANG...KOON DONATE & BUILD HOSTEL..PENANG GOVT PROVIDE LAND....BUT THE FEES & RENTAL CHARGE ON STUDENT RENTAL...COLLECTED BY KOON TRUST...NOT PENANG GOVT...SO EASY BUSINESS PREPOSITION...U GIVE THE LAND...I BUILD THE HOSTEL...I COLLECT THE FEES...LIKE THAT GENUINE DONATION MEH ?? IT IS A BUSINESS DEAL, WHERE KOON GOT NO LAND COST MAH..!

The objective of this donation is still the same, no change on terms and conditions. Penang government accepted it.THIS KOON IS TAKING ADVANTAGE LOH...UNLIKE ROBERT KUOK DONATE WITH SINCERE HEART...KOON NO LOH....!!

Mr Koon is sincere and wanted to donate this money for charity. I am very fortunate to get involve a bit in this donation. Mr Koon told me before he made this announcement.AS RAIDER MENTION IT IS JUST A BUSINESS DEAL...TAKING ADVANTAGE OF LAND...PROVIDED BY PENANG GOVT LOH!!

Please be fair and not bad mouth his good intention on this donation. I do not wish to side Mr Koon on this matter. RAIDER IS FAIR...NO BAD MOUTH...KYY ALWAYS GOT ULTERIOR MOTIVE...U NEED TO JUST UNCOVER LOH.!!
ALWAYS DON LOOK AT SURFACE LOH...!!
01/05/2017 11:25
Ooi Teik Bee You are wrong, Mr Koon has to pay RM 20 million for the land. Hence the donation is increased to RM 70 million.

Let time tells whether his intention is good or not. Penang government is very transparent on this transaction.

Thank you.
Ooi
01/05/2017 11:33
stockraider ou are wrong, Mr Koon has to pay RM 20 million for the land. Hence the donation is increased to RM 70 million.OK EVEN KOON PAY FOR LAND...THE STUDENT HOSTEL FEES IS COLLECTED BY KOON'S TRUST MAH...!!
IT IS STILL A BUSINESS PREPOSITION AND EXTEND KOON LEGACY MAH...!!

Let time tells whether his intention is good or not. Penang government is very transparent on this transaction. NO NEED TO WAIT LAH...THE INFO GIVEN....IS KOON JUST VENTURE INTO HOSTEL BUSINESS MAH...!!
IT IS NOTHING CHARITABLE ABOUT THAT LOH....!!

Thank you.
Ooi
01/05/2017 11:38
Alex Foo Sometimes it hurts to see sifus fighting with each other. As newbie needing guiding hands in this shark bursa world, I'm a little confused. I just broke even in my first trading month thanks to one sifu at i3.

Candlestick, breakouts, support, entry, resistance, position size, risk management, money management, fundamentals, technicals, trading rules....

Don't fight la, if i win money i belanja all sifus eat ice cream ok?

p/s: McD icecream RM1 version.
01/05/2017 11:44
BornToSpeculate myongcc5 instead of criticizing me, put forward your argument instead of saying something a 5 year could have replied
01/05/2017 12:23
rchi it is ok to fight,fight means they still have the 'fire'..this is wat is needed to win in bursa....hahaha.

not bad lar stockman,20% per ctr...next time try get one with 100% or even 200 %...like gdex-cd.....wakaka
01/05/2017 12:51
stockmanmy you got it exactly right.
the market do not reward smooth talking. The market rewards those who have an opinion, take risk and later proven right. And if want the market to make a difference, have to sailang like KYY.

every tycoon, everyone who ever succeeded have faced 10 naysayers, the doubters, the pessisimists.
the right attitude is called skeptical optimism.....and being steady., not nervous. high self esteemed, no need to be shy about it.
what can be taught becomes popular memes....it is what cannot be taught, what is inside and deep love for reading and learning that makes the difference.





BornToSpeculate > May 1, 2017 10:08 AM | Report Abuse

Are we serious
01/05/2017 12:59
soojinhou Wow, stocknanny, still talking. You sure like to talk.
01/05/2017 13:49
CUTLOSS 201) kcchongnz +12.9% 112883.59 http://klse.i3investor.com/servlets/pfs/71070.jsp
23% FIBON 0.695 0.555 37000|21% MAGNI 4.930+0.06 4.190 4800|20% FAVCO 2.690 2.380 8400|20% FLBHD 1.620 1.600 13700|16% LATITUD 5.250 4.900 3500 (112832.00:51.59|239.41)
http://klse.i3investor.com/blogs/ibot/121840.jsp

A hero to remember?
01/05/2017 14:05
CUTLOSS FL Bhd why up 2 sen only?
01/05/2017 14:06
pussycats But within 25 years, those nine men ruled nothing.

→Charles Schwab, the president of Bethlehem Steel, died bankrupt.
→Samuel Insull, a utility tycoon, died penniless after his empire collapsed under phony accounting.
→Howard Hopson, the president of a gas company, had a mental breakdown and lived in an insane asylum after being convicted of securities fraud.
→Richard Whitney, president of the New York Stock Exchange, was in prison for embezzlement.
→Leon Fraser, a banker and lawyer, committed suicide.
→Arthur Cutten, a commodities investor, died of a heart attacked.
→Ivar Kruger, who once dominated the match industry, killed himself after going broke.
→Albert Fall, President Harding's Secretary of the Interior, died shortly after being convicted of bribery.
→Jesse Livermore, an investor, was nearly broke and killed himself, writing to his wife: "I am a failure. I am truly sorry, but this is the only way out for me

The takeaway is something we take seriously at The Motley Fool:

Choose your role models carefully. Extreme success is often due to luck, not skill or character. Never underestimate the power of one-hit wonders, especially in a field like investing. Personally, I'm interested in people whose success spans a lifetime, across multiple ventures. People like Warren Buffett, Steve Jobs, and Elon Musk. And yes (potentially brown-nosing but honest), Fool co-founders Tom and David Gardner.

Avoid leverage. It doomed many of the nine tycoons. In investing, this means avoiding margin debt when buying stocks. I don't know anyone who has consistently used margin debt and not regretted it in hindsight. I'm actually shocked it's still legal.

Think long term. Gunning for short-term results and the constant desire for more money now took down many of these nine men's fortunes. Markets reward patience more than any other skill.

Reputation, honesty, and accountability matter more than anything. Especially in business. As Warren Buffett once said when a company he ran came under scrutiny: "Lose money and I will forgive you. But lose even a shred of reputation and I will be ruthless."

............................
pussycats → The abov article is priceless. TQ KCchong
01/05/2017 15:49
Apollo Ang but msia tycoons all didn't suffer anything.....)
01/05/2017 15:52
pussycats Apollo Ang →but msia tycoons all didn't suffer anything.....
............................
Pussycats ⇒ msia tycoons are very lucky la. Don't you think so? Food for thought. when high tide everyone is covered, but when low tide, some one will be exposed naked by Wa len bull fed.
01/05/2017 16:01
Apollo Ang I didn't see msian tycoons bangrupt,die penniless,had a mental breakdown,in prison,commit suicide,die of heart attack,kill himself? all now healthy and everynite very sound sleep
01/05/2017 16:06
stockmanmy seems you needed bad news to make you happy?

The fate is not in the stars....it is within everyone.

Go for it...reach for it.



pussycats > May 1, 2017 03:49 PM | Report Abuse

But within 25 years, those nine men ruled nothing.
01/05/2017 16:07
pussycats Pussycats ⇒ msia tycoons are very lucky la. Don't you think so? Food for thought. when high tide everyone is covered, but when low tide, some one will be exposed naked by Wa len bull fed.
01/05/2017 16:01

stockmanmy→ seems you needed bad news to make you happy?

The fate is not in the stars....it is within everyone.

Go for it...reach for it.
......................................
Pussycats comments →Did I say I am happy? No, I just want to focus on what the abov article said about the past American tycoons. We need to learn from history la, my friend.

We also need to learn from Warren Buffett famous quote→ Food for thought. When high tide everyone is covered, but when low tide, some one will be exposed naked by Wa len bull fed.

Don't turn & twist my thought lah Stockmanmy. Stockmanmy does u have negative thought about people??? Come on lah learn from every sifu, including sifu from The Motley Fool...
01/05/2017 17:16