Buy and hold is the best strategy, most of the time, provided that you bought the right stock. This is where the magic trick is, understand the company and wait. Trading on the other hand is like gambling, too stressful and unpredictable. Anyway, here are some stocks I believe they can go 2X to 5X within the next 10 years.

I've also listed down the pro and con investing into these 3 stocks. Do note that my own portfolio consist of other stocks too, half of them are growth stocks, the other half are defensive dividend stocks like Public Bank, United Plantation, Nestle, Maybank, and etc.

1. SKP RESOURCES

SKP is what I call slow and steady win the race type of company, they do not expand aggressively, have 0 debt, gives out 50% of their profit as dividends. With Dyson canceling their contract with ATAIMS, there is a good chance SKP will pick up 10-20% of ATAIMS's business. VS industry will pick up some too. 2023 will be a good year because once they've completed the new factory, they will probably get more contracts from their existing and new customer.

1A) Reasons to invest in SKP

• EMS with the highest profit margin in Malaysia.
• Management is very prudent with expansion plans and their finances, thus 0 debt and organic growth.
  
• International manufacturers are looking into diversifying out of China after witnessing the Covid disruption to the supply chain.
  
• Dyson as their main customer is growing.
• SKP was certified by TÜV Rheinland for good governance.
• Cash flow positive with high dividend payout.
• With TÜV Rheinland clearances, they have a good chance to secure new clients and contracts, also ask for higher margin due to ESG.
• China and US trade war couple with ATAIMS losing Dyson and their new factory means profit and revenue will continue to grow in the coming few years.
  

1B) Risks

• Dyson cancel their contract, which happened to ATAIMS, but unlikely now because they've got certified by TÜV Rheinland.
• Dyson's business fails to grow.
• Too concentrated on 1 single client.
  
• Ringgit becomes stronger within the next 10 years and it becomes unattractive to outsource to Malaysia.
  

1C) Notes

• Approximately 75% of SKP’s revenue derives from customer X. Its next biggest customer is Sony, followed by Panasonic, Sharp, Pioneer, Flextronics and Fujitsu
• Hike in raw material, freight and FX costs will not compress margins, given the cost pass through mechanism in place.
• SKP ships most of its manufactured output to China

​​2019

• April 2019, Printed circuit board assembly (PCBA) line commenced. Additional PCBA lines could begin in September and November. The PCBA lines are expected to enhance net margins by up to 0.5ppt, although the effect is more likely to be felt in FY21 due to initial inefficiency.

2021

• End of 2021, starts mass production of new air purifier.

2022

• Mar 2022, SKP expects to start mass production of Dyson new beauty care product.
• April 2022, TÜV Rheinland Malaysia will start auditing SKP
• May 2022, TÜV Rheinland Malaysia completes auditing SKP ( 2 months ), conclusion around June 2022.
• June 2022 Dyson ends contract with ATAIMS.
• July 2022, two new production lines starts production with new intake of foreign workers.
• End of 2022, completion of construction of a new 4-storey c.750k sq ft plant (vs. previously planned 3-storey 600k sq ft) on a 6.4-acre land in Johor Bahru which will increase its total floor space by c.75%. This new facitilies boost a 60% additional capacity.

2023

• SKP is scheduled to commence two new production lines by end 2022 and early 2023
• Potential onboarding of a new customer for SKP

2026

• SKP-WB Warrant matures on 25 April 2026, exercise price RM3.

​

2. MFCB

MFCB is the only company in Bursa that is transparent in their management, they open up their briefing to the public. Anyone can participate and ask questions. What I like about MFCB is they have a cash cow, which is the dam, and with the cash they are buying up other businesses to grow their profits. The good thing is they are not buying up for the sake of buying, they are very careful with the type of business they are buying.

Currently it has a very low PE of 6, reason being that their profit is mainly from the dam in Laos, investors fear Laos will collapse or what if the dam breaks? If given enough time nothing bad happens and their new business contributes more than 50% of the overall profit, there is a good chance investor will have to re-evaluate them. Currently 90% of their profit is from the dam. This will take time to balance things out. I consider MFCB a mid risk mid return type of stock.

2A) Reasons to invest in MFCB

• DonSahong Dam provided steady cash flow for MFCB.
• Dividends will gradually increase as they pay down their debt.
• Cash flow positive and DonSahong Dam provides good cash for them to acquire other businesses, further growing the company's revenue and profit.
  
• Open and transparent management.
• They are aggressively growing their other subsidiaries, once their plantation comes online, I believe it will be a matter of time the entire subsidiaries will contribute 50% or more of the total profit.
• With more companies under them and expanding, together with their 5th turbine and plantation, their revenue/profit will grow, potentially double in the coming years.
  

2B) Risks

• Laos defaulting on their national debt, I think small chance of Laos defaulting on their debt, most likely China will not allow this to happen by refinancing and restructuring their debt, Laos is too strategic, imagine Laos under US influence and US put a military base there?
  
• DonSahong consist of 90% of their profit, they need to grow their other businesses to lower down the overall profit generated from the dam, if they are able to do this, their valuation will go up as for now, their profit is too concentrated on the dam.
• Problem with the dam, like structural or drought
• Cambodia becomes unstable.
  

2C) Notes

• Plantation has a 50 year concession of 6420 hectares with plantable area est. 4500 hectares.
• Peak yield can only be achieved after 7-10 years for Macademia Nuts and Coconuts.
• Unlike most public listed solar companies that focus on EPCC solar projects, MFCB is on the power sales side of solar projects.
• Largest quicklime producer in Malaysia with 1960 tonne per day klin capacity with 100 years of supply.
• Plantation requires 3 to 4m capital investment needed per year until 2026.
• Nestle is now MFCB packaging customer.
• MFCB has allocated RM3m to expand 100%-owned auto company, Bloxwich S/B, which offers supply panels, LED and other parts of foreign car companies. The capex will be used to expand CNC machines.
• MFCB owns 28.8% of IST.

2D) Earnings Notes

• MFCB 90+% of the earning is from oversea and is tax exempted by Laos Government (5 years from 01/10/2020)
• The Proton solar projects have recurring income for 15 years by selling electricity. It is a 55-45 JV with Pekat.
• Stenta is in mid stream business, not many competitors, can pass on the cost increases, profit margin should be maintained.
• March 31, 2022 (1QFY2022), Edenor posted a profit after tax of RM7.85 million or RM3.93 million for MFCB’s equity portion, on revenue of RM331 million, current utilisation rate is 65%, PBT margins is at 2%. Edenor looks into improving the profit margin to 5 - 10% in 24 months.
• 100MW solar capacity is only expected to churn out around RM12 million in profit
• Edenor In 1QFY22, it registered sales of RM331m with a net profit of RM8m. At current capacity utilization of 65%, the Group aims to take 2 years to gradually increase its net margin from 2% to 5%-10% with periodic price adjustment for basic oleo products and higher productivity coupled with improved cost efficiency

2E) Don SaHong

• Wet season is from June to November
• Dry season is from November to April
• Power purchase period - 2020 to 2045
• Don Sahong Hydro Power is capable to generate 2,000 GWh of electricity annually and the electricity generated will be sold to Electricité Du Laos, which also has a 20% stake in the power plant, under a power purchase agreement for an average tariff of US$0.073kw/hr over 25 years on a take-or-pay basis.
• EDL will pay Don Sahong Power Company 90% in USD and 10% Lao Kip (Laos Currency)
• Capacity - Average 2000 GWh/year, will increase to 2500 GWh after completion of 5th turbine
• Tarrif USD 0.0615
• Increase 1% every year for the first 10 years, then reduce 20% after 15 years, then increase 1% till contract expires
• Royalty to Laos Gov - 5% for first 10 years, 15% for the next 10 years, and 30% for the last 5 years
• Income tax exemption for the first 5 years.

2021

• Construction of 5th turbine starts late Dec 2021 on dry season.
• Acquired Stenta

2022

• Oleo[ 300,000 tonne ] exercise is expected to be completed in January 2022, 12 months to turnaround. 1.5B potential yearly revenue, profit margin estimated to be about 5 to 10%, which comes to about RM9 to RM18 million per quarter based on 50% stake. MFCB expected to recoup the capital investment in 3 to 4 years.
• Solar Power C&L - 6.3MW Jun/July 2022, 19.0MW over the next 18 months
• 1% tariff adjustment to 6.27 US cents for Hydro to take effect on 1 Oct [ Every year for 10 years ].
• MFCB accquired 28.33% of Integrated Smart Technology Sdn Bhd (IST) for RM5.56 million, an ATE company for the semiconductor sector, is expected to generate around RM10 million per year or around RM2.9 million for MFCB’s equity portion.

2023

• [Hexachase ] Construction of a RM100m mega packaging factory sitting on a 10.4-acre plot of land in Melaka will be completed by early 3Q 2023, followed by machinery installation starting from 3Q 2023.
• [ Hexachase ] 2021/2022 new production capacity is expected to reach max capacity by 2023.
• [Stenta ] Construction of a 6.7 acre land factory, when completed will add 8 LLDPE and 1 CCP line by June 2023. Under the phase 1 expansion plan, two new blown film lines will be installed, followed by another two lines a year later.
• [ Packaging ] Before expansion combine revenue is RM450m, after expansion will be RM1.2B with an estimated 10%

  profit, it will contribute an additional 13% to current bottomline.

• Q1 2023, 11 megawatt of solar PV will be installed in six islands, including the cities in Maldives. JV with Powerchina Huadong Engineering Corporation. The work will be complete and power generated under the project in Q4 2023.
• August 2023, management also hinted there will be a couple of investments in the pipeline and it also plans to bring down the US dollar debt from USD108m to USD70m-80m.

2024

• Construction of the 5th turbine, which will cost about RM200m-250m is expected to be commercially operational by Q3-2024, an additional profit contribution of RM39m-40m. The expected energy availability factor is 41%.
• The 28.8%-owned Integrated Smart Technology (IST), has indicated its plans for a public listing in the next 2-3 years (2024 or 2025).

2025

• Coconut and Macadamia planting to be completed by 2025.
• October 2025, the 5 year tax free period for Don Sahong Hydro ends. Estimated to be tax at 15% after deduce other factors, not 25%.

2026

• The plantation group is still exploring various downstream processing businesses and it does not expect any positive earnings contribution until 2026.

2045

• Don Sahong Hydro 25-year concession period for the facility will end on Sept. 30, 2045.

2063

• Plantation in Cambodia has 50 years of lease, expires on 29 April 2063.

​

3. YINSON

I consider Yinson a very aggressive company, if they continue to grow and win FPSOs contract at current pace, there is a good chance they will enter KLCI30 within the coming 10 years. They are also investing into green energy from solar farms to EV charging stations, I do not consider these as core business and unlikely to be very profitable compare to their FPSO business, I believe they are doing this just for the ESG. Their EVCharger business will not be very profitable unless the gov change the law on energy supply and sales.

Yinson can be considered a high risk high reward company if you ever invest in them. The risk comes from them loading up with even more debt to grow the business. The reward will be great if they can pull off everything smoothly, finger cross.

3A) Reasons to invest in Yinson

• Yinson is aggressively growing their FPSO business.
• They are now targeting mid to large FPSOs business, previously most of their FPSO are small to mid.
  
• Their revenue and profit will continue to grow.
• They are targeting to win another FPSO contract in 2023.
• 3 FPSOs will strike first oil in 2023, 2024 and 2025, thus we can expect revenue/profit growth for the coming 3 years.
  

3B) Risk

• They are using lots of debt to grow.
• FPSOs fail or having big problem.
  
• Cash flow negative but growing aggressively.
• FPSO caught fire, got hijacked?
  
• Client cancel the FPSO project, which happened before during 2020 covid.
  

3C) Note

• No plan to raise funds via perpetuals in the near future as of 2022.
• Global FPSO market was valued at $11.91 billion in 2021 and is expected to reach $21.83 billion by 2028; it is estimated to grow at a CAGR of 8.0% from 2021 to 2028.
• Yinson charter contracts, capital expenditure, borrowings and operating costs are more than 80% denominated in USD with a small portion denominated in Malaysian Ringgit and other foreign currencies.
• The global RE market is expected to grow at a CAGR of 10.6% between 2021 and 2025 to reach a market size of USD500.4 billion in 2025.
• Frost & Sullivan forecasts 32 new operating units will be under contract, apart from regular extensions, in the period 2021 to 2025.
• Global number of FPSO installations expected to grow at a CAGR of 4.4% from 2021 to 2025. Brazil is expected to account for 53.1% of the projected FPSO orders between 2021 and 2025 due to the large number of deepwater and ultra-deepwater projects in the country.
• 60% of its MYR9.3bn total borrowings have been hedged with interest rate swaps, to mitigate the exposure to any interest rate fluctuations.

2019

• In late 2019, the Malaysian FPSO player bought two VLCCs - the Ridgebury Eagle, owned by RidgeBury Tankers, and the Apollonia, owned by Neda Maritime Agency. Apollonia, now named Hawk is being converted by Cosco into the Maria Quiteria FPSO, destined for the Petrobras-owned Parque das Baleias oil project offshore Brazil.

2021

• Petronas’s FPSO Limbayong in Malaysia (3Q21F award).
• Bought Woodside's Nganhurra FPSO

2022

• [ Bidding O&M ] Aker Energy’s FPSO Pecan in Ghana ( O&M only, not FPSO no capital required ).
• [ Bidding FPSO ] Jadestone Energy’s Nam Du Minh and PetroVietnam’s Block B, both in Vietnam.
• [ Bidding FPSO / 2HCY22F Priority ] for TotalEnergies' Cameia in Angola. The Cameia FPSO contract is likely to be awarded in 2H22F, with the FPSO targeted by TotalEnergies to begin producing from December 2024F, although it may spill over into 2025F. We estimate the FPSO capex to be in excess of US$1.5bn and up to US$2bn.
• [ Bidding FPSO / 2HCY22F Priority ] Eni's Agogo on Block 15/06, offshore Angola. We estimate the Agogo FPSO capex cost at US$1bn or more. The FPSO contract may be awarded in 2HCY22F, and the 20-year time charter may commence in CY26F.
• [ Bidding FPSO / 2HCY22F Priority ] BP Block 31 Southeast Palas-Astraea-Juno (BP's SE-PAJ) oil development in Angola ( Redeployment, no capital required ). The FPSO time charter contract may be for at least 10 years, with production to start in CY25F.
• Start recording EPCIC revenues and profits from the FPSO Maria Quiteria conversion work from 2QCY22F. Conversion yard is Cosco Shangxing.
• Atlanta and MQ projects may cross the 20% completion rate threshold by 2Q FY1/2023F (May-July 2022F) thereby allowing Yinson to book in engineering, procurement, construction, installation & commissioning (EPCIC) revenues and profits from these projects. Conversion yard is Dubai’s Drydocks World for the Atlanta.
• Yinson expects that the FPSO Anna Nery (Yinson 75% and Japanese firm Sumitomo 25%), which is in its final stages of construction, to sail away from the Cosco Qidong yard towards Brazil around July 2022, up to six months ahead of schedule.
• June 2022, FPSO Lam Son expires. [ Extended for another 12 months ]
• October 2022, FPSO Adoon expires ( Strong possibility for the contract to be extended due to the continuing productiveness of the offshore field )
• [ Perpetual Securities ] US100 million perpetual securities with coupon rate of 7.85% due on 5th October 2022. 500bps step up rate upon first call date. Yinson intends to redeem the US$100m perpetual prior to the coupon escalation.
• Yinson is targeting to secure a 3GW pipeline renewable energy (RE) by end 2022 and expand the operating portfolio of 5-10GW by 2028 in 5-7 markets.
• FY2023 ( 30 April 2022 - 31 Jan 2023 ) projected to have free cash flow instead of negative free cash flow.
• Potential IPO or strategic sale of c.25% of its FPSO holding company, planned for 4QCY22F, could unlock value for Yinson’s FPSO business and raise c.RM2.2bn
• Yinson collaborates with Chile-based renewable energy developer, Verano Capital Holdings SpA for renewable energy projects in Chile, Colombia and Peru. The collaboration initially targets to progress a pipeline of over 800 megawatts of utility scale solar projects with the first projects expected to reach a ready to build status by end of 2022.

2023

• [ Bidding FPSO ] TotalEnergies’ ENI Chissonga, offshore Angola.
• [ Bidding FPSO Priority ] TotalEnergies’ Maka in Suriname. Maka FPSO capex may cost US$1bn-1.5bn, with a production capacity of 120,000 bopd.
• [ Award FPSO ] BP’s SE-PAJ FPSO project offshore Angola may be awarded in CY23F, with Yinson in pole position since it is offering a lower-cost redeployment option using BP’s preferred FPSO Nganhurra.
• FPSO Anna Nery (Marlim, Campos Basin) is expected to achieve first oil by 1Q2023 CY, 25-year charter to Petrobras.
• June 2023, FPSO Lam Son expires.
• June 2023, PTSC Bien Dong (Expire/Extend 10 years)
• All-electric, zero-carbon emission Hydromover – the all-electric cargo vessel featuring swappable battery technology – is expected to be launched in the second quarter of 2023 and be ready for commercialisation in 2024.
• Upgrade of FPSO Atlanta will be completed by Drydocks World in 3Q2023

2024

• FY24F onwards, FPSO Anna Nery equity stake will drop to 66.5% from 75%.
• Early of Feb 2024 or first half of 2024, Yinson might exercise option to proceed or drop FPSO Atlanta (Enauta). if FPSO Atlanta (Enauta) option is exercised, it will be linked to charter, operation and maintenance contracts for a period of 15 years, which may be extended for another five years, totalling $2 billion for the period of 20 years. Yinson must pay Enauta upon exercise of this call option is 20% of the total capex cost. Since we estimate the latter at c.US$478m, hence the call option exercise price is estimated to be c.US$96m. BBC rate at US$210,000/day. 15+5 year charter to Enauta.
• [ Perpetual Securities ] US$90m perpetual was issued on 29 March 2019 with coupon of 8.1%, and the coupon will escalate to 13.1% on the fifth anniversary i.e. on 29 March 2024F.
• [ Perpetual Securities ] US$30m perpetual was issued on 5 April 2019 with coupon of 8.1%, and the coupon will escalate to 13.1% on the fifth anniversary i.e. on 5 April 2024F.
• End of 4Q2024, FPSO Maria Quiteria (Jubarte Field, North Campos) starts production, USD624k per daily charter, 22.5-year charter to Petrobras.
• 7 March 2022, Yinson had acquired 2 renewable energy generation projects in Ceará, Brazil. The expected combined installed capacity of the wind energy projects is 486 megawatts. Permits and authorisations are currently being secured for the projects, with construction anticipated to commence during the next 12 to 24 months, subject to the securing of Power Purchase Agreements.

2026

• FPSO Eni’s Agogo ( Still Bidding ), first oil expected in 2026 if Yinson win the bid.

2027

• FPSO Abigail Joseph expires Oct 2027 (can extend up to 8 years)
• FPSO Helang expires Dec 2027 (can extend up to 10 years)

2032

• FPSO John Agyekum Kufuor (JAK) expires June 2032 (can extend up to 5 years). In July 2021, Eni announced that it had made a significant oil discovery on the Eban exploration prospect in CTP Block 4, offshore Ghana, and the discovery will be produced via a subsea tie-in to the FPSO JAK. This means that the likelihood of Eni extending the time charter into the option period is very high

2033

• [ Perpetual Securities ] RM950 million perpetual susuk with coupon rate of 6.8% due in 2033. 100bps step up rate upon first call date.