I am sorry that I made a mistake in calculating my average cost per share in my previous article “Is Xingquan a good bet?”.

Xingquan was listed in 2009 with CIMB as the under writer at Rm 1.75 per share. I did not buy any share in 2009 and its it's 2009 annual account shows that I did not hold any shares. 

As you know its price has been falling quite rapidly ever since the company was listed. I started buying it in 2010 when the price fell below Rm 1.00. Its 2010 annual account shows that I had a total of 17,005 million shares. I think my average price is about 70 sen per share. 

(1) My cost is 17.005 X 0.70 = Rm 11.9 million and the price is falling rapidly ever since my purchase. 

As you know, Xingquan has been selling around 10- 12 sen per share for a long time and I bought 19.4 million shares at an average cost of 11 sen per share.

(2) My total cost is 19.4 X 0.11 = Rm 2,13 million.

When SC gave notice of suspension, its price plunged to trade between 2-5 sen per share and I bought 50.5 million shares, almost all the shares traded during those few days.

(3) My total cost is 50,5 X .035 = Rm 1.77 million.

The total of (1) + (2) + (3) totalling 86.9 million shares costing Rm 15.8 million

My average cost is Rm 15.8 divided by 86.9 = 18 sen per share.

There is always some risk in buying any share. They say ‘No risk no gain and the higher the risk the higher is the gain”. There is also a saying “The higher you climb, the bigger you fall”. Which is right?

The game is not over yet!

Unlike the case of VS Industry; very few people knew that I had been buying VS so aggressively until I became the 2^ndlargest shareholder, holding 102 million share, as shown in its 2015 annual report. The price of VS shot up 550% within 18 months.

Now I am in the lime light. The whole investing community thinks that I am crazy.

At the same time, they also know of my successful track record.

The road to my successful track record is knowledge, confidence, willing to take calculated risk and patience.

If you are patient you can buy cheaper or sell at a higher price.     

The reasons why I am willing to take the risk of buying so much of Xingquan shares are:

I visited Xingquan’s factory in Jinjiang, Fujian, China. Although I was so impressed, I did not start to buy Xingquan shares because I practise what I preach-patience! Patience! Patience!   

Xinguan received more than Rm 100 million from the IPO and it spent it on building a huge factory with all the ancillary facilities and 7 blocks of flats to accommodate 3,000 workers on a very large piece of land given the Chinese Government for a song. The company also has 110 distribution outlets in some of the shopping malls in the larger towns and cities in China. All these assets would have appreciated by now and they belong to all the shareholders. All these solid assets cannot disappear in thin air.

That is why the audited account shows that its NTA is Rm 1.90 per share. Moreover, it has cash and no bank borrowings.

In early June, when so many people were rushing to sell before its suspension, I took the risk to buy 50.5 million shares, almost all the shares traded during the few days.

I was told the controlling shareholder is making preparation to comply with the rules of SC in order to relist the company.

So betting is the name of the game?

Now stuck in limbo

see

LIST OF TOP 30 HOLDERS OF XINGUAN  AS AT 30 SEPTEMBER 2016 No. Name Holdings %

1 RHB NOMINEES (ASING) SDN BHD 269,412,616 55.53 RHB OSK SECURITIES HONG KONG LIMITED FOR TAI ZHEN XIANG HOLDINGS LIMITED

2 DB (MALAYSIA) NOMINEE (ASING) SDN BHD 22,859,100 4.71 BNYM SA/NV FOR STICHTING EFFECTENBEWAARBEDRIJF HOF HOORNEMAN

3 ALLIANCEGROUP NOMINEES (TEMPATAN) SDN BHD 16,221,200 3.34 PLEDGED SECURITIES ACCOUNT FOR KOON YEW YIN (6000051)

4 CIMSEC NOMINEES (TEMPATAN) SDN BHD 8,346,000 1.72 CIMB BANK FOR KOON YEW YIN (MY0951)

5 RHB NOMINEES (ASING) SDN BHD 7,384,600 1.52 EXEMPT AN (BP) FOR RHB SECURITIES HONG KONG LIMITED A/C CLIENTS (RETAIL)

6 LAI MING CHUN @ LAI POH LIN 6,353,000 1.31

7 TA NOMINEES (TEMPATAN) SDN BHD 5,434,100 1.12 PLEDGED SECURITIES ACCOUNT FOR YAP SUNG PANG

8 TA NOMINEES (TEMPATAN) SDN BHD 5,347,300 1.10 PLEDGED SECURITIES ACCOUNT FOR KOON YEW YIN

9 JF APEX NOMINEES (TEMPATAN) SDN BHD 5,017,800 1.03 PLEDGED SECURITIES ACCOUNT FOR OOI SIEW LOOI (STA 2)

10 MAYBANK NOMINEES (TEMPATAN) SDN BHD 4,219,000 0.87 PLEDGED SECURITIES ACCOUNT FOR KOON YEW YIN

11 TA NOMINEES (ASING) SDN BHD 4,088,900 0.84 PLEDGED SECURITIES ACCOUNT FOR SYLVAIN LAINE

12 MAYBANK NOMINEES (TEMPATAN) SDN BHD 3,255,500 0.67

13 LEE SOON SHENG 3,160,000 0.65

14 RICKOH CORPORATION SDN BHD 3,000,000 0.62

15 OOI CHENG HUAT @ OOI PENG HUAT 2,934,000 0.60

16 MO GUAN CHOON 2,600,000 0.54

17 KON CZE YAN @ KOON CZE YAN 2,431,600 0.50

18 KENANGA NOMINEES (TEMPATAN) SDN BHD 2,404,800 0.50 PLEDGED SECURITIES ACCOUNT FOR KOON YEW YIN (002)

19 PHUAH SOON KEE 2,297,000 0.47

20 MAYBANK SECURITIES NOMINEES (TEMPATAN) SDN BHD 2,113,600 0.44 PLEDGED SECURITIES ACCOUNT FOR YAP SUNG PANG (MARGIN)

21 CHOW YIT SEONG 2,020,900 0.42

22 MAYBANK NOMINEES (TEMPATAN) SDN BHD 1,876,100 0.39 PLEDGED SECURITIES ACCOUNT FOR TANG KING HUA

23 TAN LOON TOW 1,602,900 0.33

24 CHOR KIANG MONG 1,518,500 0.31

25 NG YEE 1,100,000 0.23

26 MAYBANK NOMINEES (TEMPATAN) SDN BHD 1,030,000 0.21 PLEDGED SECURITIES ACCOUNT FOR NG KIM KEE

27 NG SENG MONG @ WONG SIN MONG 1,015,000 0.21

28 RHB NOMINEES (TEMPATAN) SDN BHD 1,010,000 0.21 PLEDGED SECURITIES ACCOUNT FOR KOON YEW YIN

29 ALLIANCEGROUP NOMINEES (TEMPATAN) SDN BHD 1,000,000 0.21 PLEDGED SECURITIES ACCOUNT FOR KOH KIN LIP (8058900)

30 RHB NOMINEES (TEMPATAN) SDN BHD 959,900 0.20 PLEDGED SECURITIES ACCOUNT FOR CHONG WOI KEONG