Looking at price action .. chart wise .. I think it's too early to try to catch the bottom. It is only starting its downtrend. My thesis is it needs to do what it did during Jul to Nov 2022 i.e. drop more, find a bottom, build a base, test the downtrend again and again ... and when it finally has built a base and couldn't go down anymore, then, that's the time to buy anticipating the next path is up. But that could take several months and meanwhile, I think we'll continue to see lower prices.

I'm willing to be wrong here and not lose, and being too early to catch a falling knife.

Someone once posted past 10 years of BAT EPS. My own tabulation showed me that past 8 years, its EPS has been declining. I don't think this is due to Management mistake, but cigarettes have a reputation for bad economics these recent years and I don't think this trend is going to do a U turn ... it's one of those macro trends that is likely to persist.

Warren Buffett is famous for saying this - "“When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact.”"

In BAT's case, its business reputation (declining cigarette revenues) is likely to remain intact, no matter how good BAT management is. That's my thesis.

It is human nature - Board and senior management nature - that when revenues decline, they will eventually sack the CEO. And replace the CEO with someone more aggressive. Then the CEO takes big bets, spend a lot, and basically run the company to the ground. Like new ASTRO CEO. Took on big debts to be aggressive and then, realize that it can no longer afford to pay high dividends because Finance costs that comes from big loans is unable to generate enough cash and so, they had to cut dividends drastically.

So far, based on what I've seen on BAT management, I haven't see they cut Directors fees by 20% yet. Like to see that before I go back in. For now, I have a feeling Director fees and CEO salaries will rise rather than cut 20%.

My experience with senior management and Board members is that they typically don't like to do nothing when market share is declining. They always want to do something. Especially when they are paid handsome fees - see the Annual Reports.

Because of this human nature, more likely than not, they will make mistakes and run the company to the ground. Because of this realization, I sold and exited.

https://www.globaldata.com/store/report/malaysia-cigarettes-market-analysis/ - a good report. BAT is the market leader in cigarettes. Dunhill is the more recognized brand by BAT. The best thing is for BAT to protect its cigarette segment as it is a cash cow. The question is - is BAT Board and Management willing to hunker down, or will they follow ASTRO to be aggressive and die faster?

So, these are my thesis. In cigarettes, BAT commands 52.4% of a declining market. In vape, BAT's a nobody, based on my research. I'm willing to monitor for a year to see if my thesis is right or not. Looking for people to provide counter examples to improve my learnings.

Google "what is BAT share of cigarrette market in Malaysia" - you will realize BAT owns 52.4% of Malaysia cigarrette market and this market is declining.

You will also see BAT management keen to convert its cigarette smokers into Vape, not realizing that whilst the same customers are sticky on cigarettes, once they convert to Vape, they will have hundreds of other choices in Vape.

The Vape market is very, very different than cigarettes market.

Google "size of cigarette market in Malaysia"

See Global data site:

"The Malaysia cigarettes market size was MYR4.89 billion ($1,182.4 million) in 2021 and is expected to decrease at a CAGR of more than 1% during 2021-2026. The tobacco business in Malaysia does not appear to have promising futures as total volumes are predicted to drop from 2021 to 2026. The industry is expected to post value growth which can be attributed to price increases majorly driven by increases in taxes on tobacco products."

Google "size of vape market in Malaysia".

From Code Blue:

"KUALA LUMPUR, August 21 – The retail value for Malaysia’s vape market grew by 53 per cent from RM2.27 billion in 2019 to RM3.48 billion in 2023, according to an industry report.

The Malaysian Vape Industry Study 2023 by the Malaysian Vape Chamber of Commerce (MVCC) also revealed that the number of adult vape or e-cigarette users in Malaysia increased by 27 per cent from 1.1 million in 2019 to 1.4 million in 2022."

@Kevin, I cut loss at 9.65, losing 2 sen - my average cost is 9.67. Normally, when I lose monies in a stock, I like to keep track of the stock for another year to see if my fundamental thesis is correct. I like to read fundamental comments here to see where the blindspots are. This is part of becoming a better investor. I don't mind being proven wrong by market. When I sell, I have a thesis and here, I feel it is a strong one.

I see from your past comments that you are advocating DCA for this stock. Why do you think this stock is under-valued and worth to average down? Are you aware that Vape market in Malaysia is now generating RM3.5 billion revenue? And cigarette market revenue is only RM4.9 billlion? And BAT share of Vape is hardly anything? Don't you think BAT is too late?

@Ong, in i3, click on user name and you can see all of their past comments. There is enough clues if you study one’s comments to know which counter they are interested in.

@William, good to watch the price movements past 4 days but also watch price movement past 4 years and longer too so that you employ the right trading strategy. Many BAT retailers have been holding for longer than 4 months hoping for price to rise back and getting trapped. The longer they hold, the higher the odds of losing

Casino de bursa. Or is it Bursa de Casino 😂

@Simon, majority odds 2024 Budget will be neutral for BAT. Only very small minority odds that government will do a complete U turn on GEG. If you are betting on a U turn on GEG, that’s like buying TOTO. 😂

Dangerous to short too early. This stock can keep climbing the wall of worry for quite a long time.

Personally, I wouldn't chase this stock. I am not expecting price to run up fast. If one is patient and willing to wait 3 months, it is possible with very good odds to own at 2.51. This stock is unlikely to run up very fast, hence, just wait, key in a GTC buy order at 2.51 and don't watch the market.

For past 4 years, there is a soft sideways trading range between say 2 to 3.5. So, if price goes lower below 2.5 like 2.25, that's another accumulation zone for me. If it goes down to around 2, that's another acccumulation zone for me. If it goes down to around 1.75, it should still be another accumulation zone for me. Maybe by this stage, I get to 5% portfolio and then, I will forget about this stock.

otherwise, look forward to get paid in dividends long term.

Price gain is a bonus, but not necessary.

According to Ringgit Plus, today 12 months Term Deposit rates for the major banks like Maybank, Public Bank, CIMB bank, etc. is around 2.8% excluding special promotions. So, why put 100% monies in FD when some could be spread around like GENM to earn more than double in Dividend yield? It's backed by a decent underlying business.

Diversify and put a little bit of your FD into GENM. GENM is now 2.7% of my portfolio - I added more at 2.51 earlier this week. It feels about right.

Patience. GENM dividend yield is nice. I am still expecting next dividend to be 9 sen ex div Mar paid Apr 2024. If true, then, total DPS 15 sen is decent. On current price 2.56, that's 5.9% dividend yield, which have good odds to beat EPF.

Which means I don't need the price to run up so soon. It can stay flat for years and I am okay with that as the DPS alone is already likely to beat EPF. Any price gain is a bonus. I can live with 5.9% DY for ever.

Today is Bullish Engulfing candlestick, where today's close (9.5) is higher than yesterday's high (9.45).
Bulls should feel a sigh of relief.
However, if (low odds) Monday shows a Bearish Engulfing candlestick (e.g. if Monday's close is below 9.22), I think you will be glad to have your Stop Loss at 9.2 gets hit.
If Monday do a Bearish Engulfing, we could be looking at a serious downtrend continuation.

Nevertheless, I think less than 20% chance Monday will show a Bearish Engulfing. Next week majority odds will rise / flat.

https://punkjuicevapestore.co/collections/top-malaysian-brands

Where is Vuse?

For this week, for those who are long, I strongly advise to put a Stop Loss at below 9.2. Today is a bullish engulfing pattern signaling a potential trend reversal. So, by right, price should rise next week, if today's bullish engulfing follows through. So, next week, we don't expect 9.2 if follow technical analysis. However, If next week touches 9.2, this stock is completely dead. Hence, by right, next week, should be low odds of seeing 9.2 and when there's a low odd event happening, you should have a stop loss there because it should be low odds to see the stop loss gets executed. Trade dynamically, because market is not static by dynamic. The stop loss after next week will be different and gets updated later.

@Bradon, 9.22 is clearly the low today. Next week, 60/40 bias towards higher prices. The question mark is how long can bull sustain (a few days? 1 week? 2 weeks? 4 weeks to end Oct on next QR?) and how high can it get to (RM9.9?). I expect a lot of sellers near RM10. So, next week, next 2 weeks, next 4 weeks is critical. If prices starts to rise in the 4 weeks leading to QR release, majority chance the QR will disappoint. Punters are betting QR is good, hoping for a good Vuse results, but odds are not good here to bet on the long side.

I suspect, this next 1, 2, 4 weeks may provide opportunities for longs to exit on short term strength. I suspect 70/30 odds that RM10 resistance will hold, because many longs who averaged down below RM10 will try to exit near there to try to make a small profit. Those who are not greedy have 50/50 chance of making a tiny profit. Those who are greedy and tries to sell above RM10 like RM11 is banking on low odds of winning.

FWIW, without BAT, today, my portfolio made all time high again. It has made all time highs 3 times this week. One does not need BAT to win this game. There are so many other sound fundamental stocks with good technicals. Or buy good quality REITS at lower prices if one doesn't know technical analysis. REITS returns should match or beat EPF over 5-10 year time-frames.

@MOBA, the key thing about technical analysis is to first figure out what is the TREND, before thinking about other details like resistance, support, etc. In BAT's case, the TREND is very obvious and the downward trend is supported by terrible and ugly fundamentals. Sure, price will go down, move up, etc. but the clear downtrend is unmistakeable if you look at charts longer than say 4 years. Since 2020, it has been trading on a sideways range, typical of long term consolidation, but today's price action to make a new all time low of 9.22 is not convincing. Nevertheless bulls have been defending strongly and so, it won't be so easy to break below 9.22 yet as the momentum next week is an attempt by bulls to push prices back up again to support.

If BAT makes a new low lower than 9.22 in the coming weeks, then, bulls will have lost and we will see even lower prices.

IMHO, next week or two may be the final chance for those who are long to exit their longs.

The longer longs hold on to their position, the greater the odds of them losing. Hold for 2 years and don't be surprised to see RM7.

BAT made a new all time low today at 9.22 and rebounded. It "looks" like a "bear trap", but I am not convinced. As of today, bulls tries to regain control and the real test is Monday. I think next week is a good chance for those who are trapped on the long side to sell on strength.

The 38.2% Fibonacci retracement around 4.68 or so, is a magnet, so, price may ding dong there for a while. But the trend is bullish over past weeks, so, the bias after that is more likely a continuation of prior trend. The stock has risen 50%+, so, it's normal to build a new base first.

SPTOTO keeps buying back stocks every day.

BAT in the coming QR will be trying all accounting tricks to show high Vuse margins. It won’t work because market is always smarter than any one accountant.

Analysts will be watching BAT’s expenses in the coming QR like a hawk. Particularly the real cost of selling Vuse vs Vuse real revenues and total expenses. After subtracting long term expenses and allocating excess expenses to Vuse, if analyst discover that Vuse real margin is lower, this stock will crash.

The only risk to my prediction of RM7 in less than 2 years is:
1. BAT Management and Board slash expenses by 20%.
2. BAT increases marketing budget to protect their declining cigarette customer segment.
3. BAT accepts slow death because it cannot be market leader in Vuse to compete with hundreds of China producers. There is no real premium segment in Vaping. Google “ best vape in Malaysia” and Vuse doesn’t even feature. BAT is simply too late in the vaping space and it will never have the same monopoly or leadership like it has in the cigarette market.

Today 9.23. Classic bear drop like falling knife. I tried to warn all you longs on weekend. I then sold on Monday my longs at 9.65. I explained very patiently for those willing to listen. This is still a falling knife.

Who is selling? For this volume, it is clearly institutional.

Why are they selling? Looks to me more and more institutions are realizing that this is a sad long term bear case.

As Engineering puts it - this is probably one of the strongest long term bear case in casino de bursa.

What is it worth long term? Assuming very successful Vuse and zero cigarettes then it is not worth even 70 Sen.

That’s how strong the bear case is.

There is simply nothing to induce institutionals now, after they de-risk to come back in.

Longs have made a mistake. Still not too late to cash out at 9.2.

Give 2 years or less and you will see RM7.

Next target RM5-5.20. Entered GTC to sell another small portion on strength there. Queue and forget.

My small sell order at 4.64 filled! Lowered Average Cost to 2.80. Dividend Yield on cost raised to 8.9%.
Thank-you HAPSENG for bringing my portfolio to New Highs today!

Thanks to HAPSENG my portfolio made a new record high today! Definitely don’t need BAT to make new highs! (Cut loss BAT with a tiny tiny loss).

Hhhiii123, I concur and I am patient. I believe it will eventually rise past RM6. I can wait for many many months or even a year or two if need be some my DY on cost is already extremely nice.

Ken, you are right about not selling low. Take a small profit but leave the majority to ride higher.

The next resistance is around 4.64 or thereabouts. I will sell another 12% there and will let the remaining majority ride to next resistance above RM5 to 5.2.

4.48 close! Nice! When average cost near RM3.09!! This is now my biggest win, bigger than even YTL!!!

For the benefit of those who are still long and has done DCA, I sincerely wish that for your sake BAT will rise and allow you to exit at little loss or no loss or with gains.

But do exit your long position quickly in a downtrend because leave too late, your loss will get bigger and bigger.

I hope everyone makes a profit but reality is majority who are long in a downtrend stock always lose monies.

This is sad reality.

Nevertheless sincere best wishes to all longs.

Engineering … a nice way to describe BAT. Over next few years this could possibly be the strongest bear stock in Bursa.

Fwiw, my portfolio without BAT is already making new record levels today … don’t need BAT to make money and grow portfolio

I am out of BAT. Sold 9.65. Average cost prior to sale 9.67. Tiny tiny loss mostly due to commissions than actual loss. I hav3 over 40 other stocks that has better prospects than BAT. Consider myself lucky in BAT not to DCA and move on. Too many great stocks out there to worry about BAT.

For disclosure, my holding is still underweighted, at 2.1% of my portfolio.

When analyzing GENM, one must remember to subtract the huge depreciation and amortization which is not a real loss in the current year, but refers to the past. In H1/23, the depreciation is 618m, larger than total dividend bill of 510m (6 sen). So, as GENM turns to profit in Q2/23, it means its cash should grow i.e. 6 sen is clearly supportable.

If it sustains/improve its performance by year end, then, the 9 sen appears supportable but it will have to dip into its growing cash in H1, to pay the 9 sen for H2.

And if I keep getting 15 sen per year, the dividend yield of 6% (at current price of 2.51) is good enough for me to keep in my drawer. Still beats EPF, albeit at potentially higher risk (but also higher potential reward later), notwitstanding it is still not showing any signs of accumulations.

Professional investors can't afford to accumulate stocks that sits still. But individual investors can. I don't mind getting paid 6% p.a. returns whilst waiting.

IMHO, this company is solid enough to keep adding when price goes lower.

@nepo, thanks for sharing. However Maybank IB may be working alone and not have the support of others yet. Still hasn't seen signs of accumulation by the market. This one must be patient.

The real question mark for dividend investors is the next dividend that's usually paid in April. Will earnings be good enough to support 9 sen like last year? If earnings are not good enough to support 9 sen dividend, then, there will be a dividend cut and notwitstanding all the good news promoted by Maybank IB, if it cuts dividends, it means something is wrong. By right good news should give good dividends, not cutting dividends.

I still accumulate at lower prices (subject to maximum portfolio limits) but with no signs of accumulation, this one can be a long wait.

Quek can live up to 100 quite easily with the monies he has. But I am also okay to get 6% returns for the next 18 years ..... haha

Do what professionals do. Find a good boss with proven long term track record (at least 5 if not 10 consecutive years) and be 100% transparent to him/her.

If you are not beating FD rates, not beating KLCI index after 3-10 years of self investing, either you find a professional boss (not those educators who charges you a lot of monies with no real long term proven track record), and for 99.9% of you who cannot find one, then, put your monies into EPF first. Especially when EPF beats your past 3-10 year track record. And learn about good quality REITS. These can help you beat EPF. And be on the lookout for low cost unit trust - these are good with good timing i.e. after market crashes.

To amplify what professionals does with BAT.
1. BAT is not a component of the KLCI index (Top 30 companies). Therefore, if a professional results is benchmark against KLCI Top 30, then, he would only invest in BAT *if* he thinks that BAT will outperform the KLCI index. Here, he doesn't, therefore, he has zero weighting in BAT.
2. BAT may be a component of the FBM Top 100. If so, it's weighting should be less than 1% of the index. So, if the professional investor is benchmarked against the FBM Top 100, his neutral stance is less than 1% of his portfolio. If he owns more than 1% of the portfolio, it means he is bulllish on BAT. If he is bearish on BAT, he will own slightly less than neutral stance. And if he has strong bearish views, he will probably hold 50%-70% of his neutral stance since he also has to report to his boss why he deviates. He may hold nil, if he can convince his boss that FBM100 will remove BAT from its index.

This is typically how professional investors invests. They don't make huge deviations from their benchmark.

And for sure, they do not do DCA. Their boss won't let them.

But in education space, someone always teach the ignorant retailers to do DCA, different than what the professionals do.

Actually, when I cut loss tomorrow, I also don't behave like an institutional investor.
Institutional investors benchmark against an index. For example, KLSE index.
Therefore, their mix follows the index.
Let say the BAT share in their benchmark index is 1%.
So, their neutral stance is 1% mix.
When BAT share price falls, it's share in the benchmark index is automatically reduced to 0.8% say.
Then, the institutional investor do nothing - they maintain their mix to 0.8%.

In short, the professional institutional investors do not blindly do DCA, as what "educators"/websites/etc. teach ignorant retail investors.

The professionals get someone else to teach the ignorant retailers to do things differently than what they actually do.

I made a mistake in BAT, when I queue and not chase at RM10. My purchase at RM10 is nearly 1% of my portfolio. My strategy is simple here on Monday. I am willing to sell on Monday. Let say I sell at RM9 and lose 10%. This is only 0.1% of my capital. I have far bigger trading wins let alone dividends collected that will over come this. Therefore, I have no plans for a DCA in this stock. I cut my loss and move on. Odds are high, I will sell higher than 9.57 close successfully, so, my loss is even smaller than I planned.

This should be the professional mindset - not DCA blindly.