By my metric yes.

Does not mean it cannot go higher though. Feel free to buy it if you feel there is someone, moving forward, who will be willing to pay more.

james86 mbsb already 1.17, overvalued?
03/01/2018 14:01

Wow.

Before people here say USD, do note that last year grew sales by 20% in USD value, not RM.

Now, the last 3 quarters they had margin compression due to lack of rubberwood, and top it off with a fire on 27 october which was fully handled within 17 days. And during that time, there was overtime by staff.

This stock is probably quite cheap. Especially given the growth which is far from priced into the stock.

Bought as much as i dare to buy d.

Will only buy more in June 2018, when MFRS 9 comes into effect, may have impairments then for all financial institutions, and if really got discount.

I am out.

Why? In essence, not a fan of the industry (cost based, increase in earnings due to higher efficiency tend to go to customers via discounts instead of to the company).

I held it as i thought the ROIC is pretty good and i like the gigantic cash balance, however, i think but the problem is that this wonderful cash balance will all be going into their expansion into the fabric mill, which while good for the company, is much better for the customers and not so good for the investors.

Whatever cost savings from the mill, will need to be given to customers in order to undercut magni etc. Its a race to the bottom.

I have better/cheaper opportunities available. I have originally wanted to sell my PRlexus at 1.2 for this similarly undervalued opportunity, except its in a far better industry.

But my ego got in the way, i wanted this to be a gain as i was sure of my research, which included all of the above.

PRLEXUS is my biggest loss in 2017.

Moving forward, i will not be buying any stocks from cost based industries with high capex, unless it is a net net (ie choobee, which i bought at 1.75 and sold at 1.9 and 2.1).

10bagger10 choivo sifu, prlexus any opinion?
02/01/2018 12:38

Haha, thank you. My returns however, should be far below yours this year. Still have alot to learn :)


VenfxPandora18 CHOIVO capital,

By reading your article, it is always a mind blogging.
The perspectives you have shared really btoaden my knowledge.
01/01/2018 11:50

I really like this portfolio.

Priceworth is too much of a punt for me. But if it works, really will win. If it does not, will drop quite badly also i think.

Masteel is a little scary for me due to reversion to the mean. High Steel prices mean higher supply and therefore, lower price etc etc.

But then again, i may have gotten my time frame wrong. That may only happen 1-2 years down the road. Or not at all, if HSR etc gets on track.

WCE, EKOVEST and GADANG on the other hand. I really want some. But no money.

Definitely, that's one way to get real down to earth information. That's why my position is very small. =)

limml On undervaluation of a certain bank, maybe you should find out how many of your family members, friends and associates park their money, especially the portion meant for retirement, with the bank as FD. If you find that most of them, especially if you yourself don't park the money with the bank, then you may have got the answer why the market gives it low valuation.
01/01/2018 10:05

Also, Q4 2016, they have fantastic IRU sales and huge deferred tax gain. So this coming quarter is probably not going to bea last years.

This should mean some possible discounts come febuary. I won't sell as i promised myself to only purchase or sell on fundamentals or value, and not prediction of price movements.

You may feel differently. Different strokes for different folks.

Operational profit have fallen this year higher depreciation of RM6.7 million mainly due to the completion of SKR1M and AAE-1 cable systems during the year, as well as the impact of depreciation from the Asia Pacific Gateway submarine cable system, which was not fully included in the results for 2016 as the cable system was only completed on 28 October 2016.

In addition, there was a higher net loss on foreign exchange of RM17.6 million in 9M 2017 compared to RM5.2 million in 9M 2016, and zero dividend income for the year compared to the previous year, as all their DIGI shares have been disposed.

Naturally, more care must be taken to ensure these cost are truly one of or extraordinary, and not one-off/extraordinary cost that happen with regularity.

In addition, lower one-off IRU sales, also contributed to lower profit.

If you ask me what result will happen next year, or whats the future profit figure, i have absolutely no idea. I only know its a fantastic business that has resilient growth at an ok-ish price.

Like i said, i don't dare to buy more as it is not cheap and the size at 28% of portfolio is big enough for me. It may even be too big at this price. Future purchase will only be if my portfolio becomes to big and i need to re-balance it, incredible out-performance in fundamentals, or incredible drop in price.

I'm not looking at 3 month period for this one, im looking at 3-5 years at least. Unless you are willing to really understand this company (especially since its really not cheap at all) and do you own valuation. Id suggest something else. LATITUD or FAVCO is an easier buy.


Posted by uptrending > Jan 1, 2018 12:01 PM | Report Abuse

Jon, Profits have been coming down in the recent quarters, what sre the reasons ? Thanks...

What do you mean?

valuelurker No, and I'll give you a hint, its got to do with your 'rule of thumb' and the assumptions youre making
31/12/2017 18:28

Refer to the formulas in the spreadsheet. The rule of thumb, does take leverage into account. But it does not take bankruptcy risk into account.

I'm guessing you're referring to KCCHONGNZ. I definitely learned a lot from him. I actually finished all his blog post. He's a great writer and has very very varied experience and knowledge of the markets. Even OTB said that his returns was rubbish until he started to learn from KCCHONGNZ.

If i were him, i would not be talking about my current picks either, especially since his subscribers are paying him money for that. It would be unfair to the people that pay him for him to share his picks here.

"Flintstones Btw Jon, how do we apply the rule of thumb on other banks with different leverage ratio? Using maybank as an example, I couldnt get the valuation that you got from the spreadsheet. Would you mind showing the maths behind the calculation?
31/12/2017 11:57"




One of the most undervalued. There is another company, that is the best and most undervalued. I kept it out of the spreadsheet.

Affin is at a 40% discount to fv using my formula now.

"TheContrarian Affin most undervalued?
31/12/2017 12:11"




You comments on the basel 3 requirements as well LCR do hold merit. However, this is only a rough guide. I'm not a bank expert. For me, when it comes to investing, i follow this saying.

"You don't need to know the weight of a woman to know if she's fat, or the age of a man to know if he's old"

As long as its within the margin of safety, i'm fairly good with it.

On liquidity. Liquidity crunches are common and a way of life for banks. The real life equivalent would be "Tripping".

In life, when you are walking or running, you will trip over something. Sometimes you will fall, sometimes, you will be able to catch yourself. Its almost never a big deal.

Tripping becomes a problem when you're running top speed on uneven ground, while carrying 100 plates stacked to the sky. An small bump, or in this case liquidity crunch, and you will be properly fucked.

Pre-crisis. The banks using synthetic CDO's (Which in itself were leveraged) were theoretically leveraged in same cases more than 100 times. And these so called liquid instruments, were build upon very illiquid assets. This means the instruments themselves were not truly liquid to begin with.

It would be a little bit premature to say that the main reason for the crisis is due to liquidity crunch. |

Its like saying, the only reason he died was because he tripped. If you tripped while walking, no biggie. If you died, when your tripped while walking on a tightrope 500 meters in the sky. Maybe the main reason you died was because you were walking on a tightrope 500 meters in the sky in the first place.

"Fabien Extraordinaire Liquidity crunch was the main reason in the last financial crisis that made some banks go bust or almost bust.
31/12/2017 11:32"




Good catch! Updated. Thanks!

"Unlevered very good article!! btw drop in value to bankruptcy for BANK A,B,C should be 9%, 20% and 1 % respectively. Can Jon kindly elaborate the math underlying the thumb rule valuation? Please write more such articles in the future :D, thanks!
31/12/2017 16:32"

Here you go.

https://klse.i3investor.com/blogs/PilosopoCapital/142803.jsp

Flintstones Please do. Nobody in i3 has done that yet. Look forward.
29/12/2017 20:05

Mr Tan, sorry to bother you but i changed PRLEXUS-WA to DNEX but i dont think it was taken up. Possible to still change? If cannot nvm =)

Thanks for everything.

Dec 29, 2017 06:57 PM | Report Abuse

2018 stockpick.

Change Prlexus to DNEX

1) RCECAP 20000 shares
2) AEONCR 1100 shares
3) TIMECOM 1700 shares
4) FAVCO 3000 Shares
5) LIIHEN 2200 shares
6) LATITUDE 1900 shares
7) PLENITUDE 5200 shares
8) DNEX 14800 shares

If price change, just reduce from DNEX

Thanks Mr tan

Posted by Tan KW > Dec 31, 2017 12:39 AM | Report Abuse

You can organize another self manage portfolio. please go ahead

ScrewDriver Do you mind if I compile my own portfolio
(https://klse.i3investor.com/servlets/pfs/99368.jsp)
to join the contest?
All of my picks (except for ARMADA) consist company warrant which does not have entitlement, hence requires minimal portfolio update. Thank you.
30/12/2017 23:39

First question.

If the logging rights so good until can make 100mil per year, why sell to you at 230mil? And so nice discount 50mil from the original price summore.

Secondly, even if the rights is that good, as the previous owner, the only reason i would want to sell it, is if i lazy to continue working on it.

In this case, why not sell a 51% share instead, so that i can partake in the future fantastic profits?

In addition, if they have started logging in May 2017 and say in 2018 can get 100mil profit, why the profit in the quarters Jun 2017 and Sept 2017 (1st quarter for 2018) is only RM4mil?

Even the first quarter for 2018 is only RM 1 mil, the boss going to ramp up productions 100X in the next 3 quarters (actually sooner, since he will need full production to even touch RM 50mil revenue ) to achieve RM100m profit for financial year ending 2018?

Also, in malaysia, unlike the US, states cannot willy nilly set their import restrictions etc, end of the day, all go through federal govt. Government nothing to do place tariff in sarawak but not in sabah ah?

Seems a touch fishy to me.

Haha the mods labeled it, but thanks anyway.

On TIME, once again, not a cheap stock. And this year, the initial depreciation cost for the new cables, drop in IRU and lack of one off forex gains really whack the earnings.

But retail is still expanding very very quickly (106% increase over the previous year), and 5G will not be as big of a threat as i thought it might.

I'll just hold. The price may not even move much for 1-2 years, as the chart available at malaysiastock.biz includes a lot of other income in the previous years which will not be available moving forward.

But, moving forward, 1-2 years of continuous increasing in revenue and earnings may improve investor visibility, so we still have 1-2 years to collect.

I don't dare to buy more now as it is already 30%, the largest position, and the stock valuations is not cheap. But 6-12 months from now, when portfolio is bigger, who knows. =)

Posted by Kristal > Dec 30, 2017 01:13 AM | Report Abuse

(JON CHOIVO) An analysis of TIME dotCom Berhad (“TIME”) https://klse.i3investor.com/blogs/PilosopoCapital/142735.jsp

Possible, i think so too. I'm mixing it up a bit. My top 3-4 holdings is 60% of my holdings already. The rest, are relatively small 1-4% positions.

My problem is that i'm conservative, and the thing about investment is that you don't have perfect knowledge, so when something is a large enough discount to intrinsic value, i'll just buy. If i'm really really sure of something, ill build my position up to a maximum of 30%. I think 30% is the absolute max for me d.

I wont make the kind of money highly concentrated portfolios will make, but i also wont lose the kind of money they lose.

Alex™ u focus on too much stock. Play lesser. 7-8.
29/12/2017 23:31

Just google how Warren Buffet values financial institution.

Main rule of thumb for me is, ROA of 1%, While Leveraged 10X, Fair value is 1X P/B. I may write a post describing it.

Flintstones Hi, interested to learn more how to value financial institution. May i know where can i read more? Especially the part of 1x book value given to financial institution with roa 1%

Hmm that was a worse result than expected. I need to study again.

2018 stockpick.

Change Prlexus to DNEX

1) RCECAP 20000 shares
2) AEONCR 1100 shares
3) TIMECOM 1700 shares
4) FAVCO 3000 Shares
5) LIIHEN 2200 shares
6) LATITUDE 1900 shares
7) PLENITUDE 5200 shares
8) DNEX 14800 shares

If price change, just reduce from DNEX

Thanks Mr tan

Wow Hng33,

Respect you, you really put your money where your mouth is. 95% into this one stock.

Either you are very very foolish, or you know something even i don't know, after reading so much.

Good luck to you.

Haha hopefully 60C?

Then i can buy more. Too bad i not KYY, otherwise can top up d.

Wait lol, i was reading the sept one. Thought you meant results out d. Haha

Thankfully, the price more than incorporates all these bad results =)

Fairly ok with it, drop in revenue, but GP shows no compression.

oxxxyxxx Poor result..
29/12/2017 18:06

2018 stockpick.

1) RCECAP 20000 shares
2) AEONCR 1100 shares
3) TIMECOM 1700 shares
4) FAVCO 3000 Shares
5) LIIHEN 2200 shares
6) LATITUDE 1900 shares
7) PLENITUDE 5200 shares
8) PRLEXUS-WA 28200 shares

If price change, just reduce from PRLEXUS-WA

Thanks Mr tan

2018 stockpick.

1) RCECAP 30%
2) AEONCR 15%
3) TIMECOM 15%
4) FAVCO 8%
5) LIIHEN 8%
6) LATITUDE 8%
7) PLENITUDE 8%
8) PRLEXUS-WA 8%

Thanks MR tan

The fact that a company that is building a RM119 garment factory is valued at only 160m.

Is that an error of the market or the error of the management.

Is the management supposed to expand as per how much the business can take it, or as per how much some random people say your company is worth?

Don't be foolish.

Posted by noah > Dec 26, 2017 11:46 PM | Report Abuse

RM119m garment factory is simply way too ambitious for a company with RM160m market cap.
they should start with a smaller scale eg. RM50m and scale up phase by phase.
incur less initial start up cost and depreciation.

1) RCECAP 30%
2) AEONCR 15%
3) TIMECOM 15%
4) FAVCO 8%
5) LIIHEN 8%
6) LATITUDE 8%
7) PLENITUDE 8%
8) PRLEXUS-WA 8%

Honestly, the 8% ones are the ones i just think its cheap and worth a buy, alot of stocks hit this criteria as well, like orient,uoadev,uems,muhibbah,daiman etc etc

Its a fabric mill, not a manufacturing plant. Its to supply fabrics to their plant.

GP Margin got no compression yoy, still 20%. I dont sense that someone is really fucking them on the margins yet.

I think the automation thing mainly works for fast fashion, where you need flexibility and you cant do gigantic orders. Ruyi, bought over a retailer, i have a feeling they want to do their own fashion brand.

Cost base for very large quantities is completely different compared to smaller orders. Given that cost base of machines of 0.33 cents or RM1.32. That seems pretty close to the prlexus's one currently.

uptrending Fabric Mill
Building construction cost RM54 million
Facilities construction cost RM27 million
Machinery and equipment Rm33 million

Disproportionately low investment in machinery and equipment, how much automation is the new mill ?

Wow.

Hahaha i think i might actually get to top up.

Whats the long term view for this one. Can this company survive its 900mil per year finance cost?

dompeilee T + 4 for 140+ million shares. Ppl like me who pick up the shares with cash need not panic. Let it drop to 60c if it wants! Those who sailang & contra, drop an extra 0.5c also panic!
22/12/2017 15:12

It will always rebound, just a matter of how much more it will drop.

Of course predicting this is an exercise in futility. I'll just focus on understanding the intrinsic value of what you're buying.

Posted by Geo123 > Dec 21, 2017 04:59 PM | Report Abuse

@Pmaster, you bought again? Why you are confident it will be rebound?

Wow. I think its about time for a top up.

I like when management kiamsiap. Pbbank most kiam, give you nothing haha.


pingdan Go luck on hlding this company... this company famous for bullying small shareholder.. see the dividend they pay.. i went to their agm before.. they only serve 2 plate of char bihun during agm and one plate of kuih.. sibeh kiamsiap.. we request to pay more dividend and the director refused it..
17/12/2017 23:17

hng33 still alive ah.

I have never seen an article so long and so lacking in value.

I have gone through every single annual report in the bursa, and i can safely say that the management analysis done by serbadinamik is the most detailed i've ever seen in an annual report.

They are responsible for running the business, not the stock price. You think cheap, buy more. No need talk so much.

richorpoor UOADEV need to do something about the poor performance of their share...cash-rich and on time good dividend payout is not doing much compared to some other listed company with much lesser credibility but having better valuation!!!

Wah you're still at it ah. Lai lai i write to help you also.

How do you tag a stock in a blog?

I really dont know what to say, instead of going down, it went up.

God ah, why all the shares i want behave so weird one.

oh sweet lord, please stay down or go lower, i want to go in.

Calvintaneng,

You retiree is it. So free write so much ahaha.

Most overvalued bank in msia, up dick ah.

All your points essentially tell me bitcoin is actually close to worthless.

Blockchain technology will change everything, but bitcoin on its own is worthless.

Right now, the blockchain survives because people are willing to mine. By mining, this keeps the chain updated.

However, why would people keep mining, if the number of coins that can be mined keeps dropping? Only one reason will keep them there, that the value of the coins keep going up.

Except, past a certain value, you will want to move your money elsewhere.

If tmr, the RM gain so strongly versus the USD that its 1:1.Obviously, everyone is going to move their money to the USD, because they know fundamentally, the real value for the USD is much higher than the RM.

When will people decide to move money out of bitcoin? USD20k, USD30k, USD 40K? I have no idea, all i know is, in economics, things that you think will happen take longer than you think it will, and when it happens, it will happen faster than you think it would.

Oil price drop from USD140 per barrel to USD27 in less than a year, now its USD 60. Whats the real value?

The second bit. Currently they say 80% of the coins is held by 1000 people. Most of them are probably miners. Now if the value of the coins does not go up fast enough to cover the increasing electrical cost, these people are not going to mine anymore. However, they also know that if they stop mining, the block chain will stop working. Rendering their coins valueless.

So they will start to sell, which is a reinforcing feedback loop, as the prices drop and recovery comes slow, more and more people want to sell, resulting in what is ultimately a crash.

Except this time, so many people will properly kena. Since people now in venezuela, phillipines etc are stupid enough to do transactions in these coins and keep their life savings there.

Bitcoin if you look at the news, started the year as a gamble, now, people think its an asset class, soon, they will think of it as gold. When they think of it as gold, you know well and truly the bubble is at its peak.

Because when its a gamble, you wont put much money, but when you think it is gold, you will put all your money in.

The reason why people buy bitcoin now is due to the strong quantitative easing done by the ECB and Federal Reserve. Causing asset prices everywhere to go up and interest rates to go down.

When interest rates are negative or less than 1%, the pricing of assets and risk go haywire, things you normally expect 10% return from, now you only expect 5%.

And if you're reaching for yield is this low yield condition, you do 2 things, leverage up or reach towards exotic investments like PE or bitcoin in this case.

Don't worry about it, bitcoin is not the crash. Bitcoin is the spark, the wood for the crash is the sheer amount of debt that is held by all the governments in the world.


Posted by PlsGiveBonus > Dec 13, 2017 12:27 PM | Report Abuse

'Dean of Valuation' Believes Cryptocurrencies Are Replacing Gold

Aswath Damodaran, a professor of finance at New York University's Stern School of Business, is widely respected as an expert in valuing companies, so much so that he has been dubbed the "dean of valuation" by the finance industry. Thus, when he makes a prediction about a major financial matter, he tends to draw a great deal of attention from those interested in the investment potential his statements might suggest.

Bla Bla Bla

Damn cute lah you bro. I tunggu jatuh lagi, 20 sen saya beli.

Posted by Mohd Yazid Mohd Ali > Dec 13, 2017 05:29 PM | Report Abuse

HAK PUIIIIIIIOI SIAL PUNYA COUNTER

This is so wrong and so inaccurate on so many levels.

Just tell me then, what's the intrinsic value of bitcoin and how you calculate it.

I'll make a bet with you. 10 years from now, bitcoin value will be less than 5k.


Posted by PlsGiveBonus > Dec 13, 2017 11:55 AM | Report Abuse

You know how Bitcoin billionaires are made? During the last crypto boom.
You know how warren Buffett become billions? During the last stock market boom.
You want to be rich like them? Don't buy their dump.
:)

Not safe, please sell.

Wheres the tut tut

haha finally quiet. Ok time to consider buying.

Eh diam lah calvin, let market stay low. Do charity for what.

No need you to support one, keep dropping, im ok. I know its cheap.

Investing in stocks is in more ways than one, the arbitrage between the price and the intrinsic value of the stock, given time they must converge. We just use margin of safety ensure that we can stand the fluctuations in intrinsic value.


WalalaSonono Tiu! all these pokai sochai hold onto losses. Everyday also cry baby now change name to comment each time to fish for support. Pathethic!
11/12/2017 10:21