2023 Annual Report page 36

TAN MUN LIN
• Non-Independent Non–Executive Director
• Member of the Nomination Committee (“NC”)
• Aged 36, Malaysian, Female
Ms Tan Mun Lin was appointed to your Board of Directors
on 11 January 2021. She holds the Capital Markets Services
Representative Licence issued by the Securities Commission
of Malaysia (SC) and is licensed as a representative by the
Securities and Futures Commission of Hong Kong (SFC), both
for the regulated activity of fund management.

Ms Tan is a fund manager and Executive Director of Capital
Dynamics Asset Management Sdn Bhd. She also serves as
the deputy group CEO of Capital Dynamics, an investment
advisory and fund management group licensed by the SC, the
Monetary Authority of Singapore, the Australian Securities and
Investments Commission and the SFC.

Ms Tan has more than 14 years of experience in the
regulated investment advisory and fund management
industry. She possesses extensive experience in local and
global investment research and analysis, legal, regulatory
& compliance, marketing/business development, HR,
operations, strategy and management.
Ms Tan started her career in Capital Dynamics as Executive
Assistant to CEO (Investment Research) in September 2009.
She graduated with Bachelor of Commerce and Bachelor of
Laws from the University of Sydney in 2009.

Ms Tan Mun Lin has no family relationship with any director or
major shareholder of your Fund nor has any possible conflict
of interest with your Fund save as disclosed that she is also
the Executive Director of your Fund Manager. She has not
been convicted of any offence (other than traffic offence, if
any) within the past five (5) years nor any public sanctions
or penalty imposed by relevant regulatory bodies during
the financial year. She attended six (6) Board of Directors’
Meetings held in the financial year ended 31 May 2023.

Also been warned that I am a wanted man, can appear on a big presentation screen as public enemy #1. Don't appear.

Is the board really independent?

That control has been a talk of the town when I pointed Tan Mun Ling is someone is working in CDAM. I need to go through the annual report and see.. Whoever has more information, please share.

“You can fool some of the people all of the time, and all of the people some of the time, but you can not fool all of the people all of the time.”
― Abraham Lincoln

I will be away for a business trip....I won't be able to participate for a while......see you all a bit later.

The fund manager is an expert to determine when iCAP is way below its intrinsic value. Trust me, he will know it. He knows something look like a duck quack like a duck(iCAP is way below its intrinsic value). He invested on behalf of his clients CDAM and even director knows it, they stepped in to buy. I am merely pointing out iCAP PUT is a missing tool in the tool box. They are proposing dividend to be included in the tool box, I am fine with that except I don't support DRIP should be issued at a discounts, it is unfair to those accepted Cash dividend. It is a reward for those opt for DRIP but a punishment to Cash dividend holders. We know a lot of small holders will go for cash dividend because their holding is so small have a meaningful DRIP. It's equity logic here and I know between money and equity, in the proxy war, equity will be flushed out. I only bet on conscience and hopefully we have more people with conscience.

Many of iCAP followers follow the arguments that SBB will narrow or make discounts disappears in the past....I was away from iCAP for 10 years....I didn't have this historical baggage. I think we should erased this. SBB is innocent. Look at afresh again....

A rational fund manager will produce rational results....I felt he got a little past traumatic experience. Start afresh, aim for 1.5 market cap. Everybody wins. Please include the missing iCAP PUT tool, you don't have to use....just in case.

There is no denial that some companies abuse SBB that to a point we can argue it is a moral hazard. Top Glove for example, it has been goreng to a bubble level. When the bubble burst, the first thing the company did was to do SBB. ridiculous....they should not. In fact the minority shareholders should revolt. Call for an EGM, take the SBB away from them.

the fund manager should not be afraid of fees of which I think he rich enough not to be bothered. He is also capable to grow market cap to from current 300++ million cap to 1.5 billion. You do the math how much will he gets when it reach 1.5 billion. I am okay if keep 1.5% management fees because he help shareholders create almost 1.3 billion wealth.

@patient investor...Like you, if you followed my sparring sessions with @dumbMoney, I argued with him from the beginning that if iCAP buy back share, it will reduce the outstanding. And that will support the evil COL.

I even argued to the extreme that if iCAP used up all the $ 130 millions, it will help the evil COL trigger MGO, mandatory general offer.

That is only true when shares bought to cancel it but if is it distributed to shareholders, it will go back to original outstanding.

Illustration, there is 140 million shares outstanding, iCAP buys back 1 million share(at times of crisis) and keep it as treasury shares, if you use it to cancel yes, it will be reduced to 139 million shares but if you distribute this 1 million to shareholders, then it will go back to original 140 million. How dumb was I, making such a fundamental mistake.

Public Enemy No 1? 😱

That's why I write the logics and hoping accidentally got masters with Mustang horsepower brains read it, pick it up and x tahan and help to speak on their behalf of those can't. Yesterday I said minority interest shareholder should help themselves ..... dream on... they can't.

Have you ever see a peasat dare to speak loudly to a master? They only bow silently. 😔

TBH, If you have seen my earlier posts carefully, I am not against dividend plan. What is left out is another tool in the tool box that is SBB. We can declare dividend when the market function normally. Just like recent pullback, we should not buy back all. Declare dividend. But if there is sudden loss of confidence like dropping 15% in a week and that is 30-40% below NAV, we should do buy back. When it went up back to 20% and stabilizing, leave it alone. Like I said we are not interested to buy until zero discounts.

We also being poisoned because we equate SBB=COL. COL= Evil, therefore we automatically think SBB = evil. No mater how unhappy we are with COL, we should separate it as 2 issues. SBB is innocent.

My this morning post is saying even director or CDAM see iCAP is way below its intrinsic value and buy. I thank them. Give credit when credit is due.

In the past the issue, iCAP retain all the cash and let it compound. Therefore, SBB should not be considered. Now is different, iCAP is okay to allocate a fixed sum of cash to return to owners. Those smart owners will choose cash because they think we can manage their emotion and use it to buy in case share price below ex-dividend. But majority can't. People like you is probably is an above average skill investor. You can, other can't. I speak behalf on others that can't.

I am not interested in day to day price fluctuations or personal gains or losses. It's the governance issue. Also offer different perspective so that we don't follow blindly. This is the reason I appear in this forum.

I wan to guarantee you that if I put forward a motion, I will be voted down in AGM but it's okay. Let the voice be heard.

@Patient Investor. Have you been to the previous AGMs? Can you share your experience with me?

Hats off to those who speak their minds. At least they have a mind of their own. You speak out what you believe. SBB was not given a chance to be debated.....

Choice A - innovative dividend
Choice B - refer to choice A

Not happy get out!

😎😂😂

iCAP PUT is not innovative and I just borrow from a lesson learnt from the Federal Reserves(Fed) will make the market to believe they, the Fed, will intervene in times of the crisis of confidence. Many of us would have heard of Greenspan PUT or Ben Bernanke’s dropping free money from the helicopter during QE eras.

“Greenspan put was the moniker given to the policies implemented by Alan Greenspan during his tenure as Federal Reserve (Fed) Chair. The Greenspan-led Fed was extremely proactive in halting excessive stock market declines, acting as a form of insurance against losses, similar to a regular put option.”

Find out more from this link: https://www.investopedia.com/terms/g/greenspanput.asp

The key word is EXCESSIVE or the word that I have been using IRRATIONAL DISCOUNTS.

For those who understood iCAP PUT immediately, you must have been in the financial markets at least 20 years and you are very likely more than 40 years old. I heard iCAP demographic is consists of a big % of people over 50 years old. So, your instinct will tell you it’s a no brainer.

Your fund director and other fund manage by iCAP fund manager implemented that too sub-consciously. Ms. Tan Mun Lin has shown solidarity by buying 25,000 shares and Capital Dynamics asset management supplied liquidity with the purchase 937,900 shares during iCAP lost decade. And I thank you for these efforts. Those exit at the time when they were taking shares off your hands at the times your desperately wanting to exit at any price, you must thank them. (see shares the bought in page 58 and 59 of iCAP’s 2023 Annual Report)

Your good actions are telling us we are on the same page and on the same side of a coin.

If we the shareholders asking the same that you buy on our behalf with a pre-approved RM 15 million/year, can you do that for us? Please🙏🙏🙏 . Are we asking for too much?

I will buy some Coke, chips and re-watch THE BIG SHORT tonight. Have a nice weekend.

👌. Choose wisely.😉

I hope iCAP will not trap into it's heavy historical baggage and should avoid xenophobia....I pray for healing but it takes two to tango. we shall see.

Meanwhile, for the rest of the shareholders, in my humble opinion.

"God will help who help themselves" 1 vote 1 voice. Let your voice to be heard. Do you want iCAP PUT?

Share buy back -- iCAP PUT. Standing solidarity with shareholders.

If all the 3,000+ shareholders are buy-and-hold forever type, discounts don’t matter. Any form of discounts – irrational or rational don’t matter.
If you are in this bucket, congratulations! You have achieved ABSOLUTE financial freedom. You are in the top 1% or even top 0.1% income group in the country. You are flushed with cash. Zero headache on discounts, you will worry more on where to invest next or how to spend them or perhaps figure out how to write a good will to avoid estate fight after your departure.
Unfortunately, 99% or 99.9% of people have a possibility to exit due to many reasons. If these people need to exit and luck is not on their side during a bear market, demand for shares will fall. Adding salt to the wound, all wanted to rush out the same door at the same time, this will add a lot of supply to the market. Demand is falling and big supply is coming, Kaboom, we have a perfect storm – very irrational discounts will spring to life. If iCAP has a share buy back program and do intervention consistently, the market will know there is an iCAP put. You draw a line in the sand.
They will hold back or slowing down their selling. The losses on iCAP shareholders who exited will be lesser. There could be 5% lesser or even 10% lesser losses….anyone with 5,000 shares, will save them a few hundred to a thousand ringgit lesser losses. I can say, it’s also a form of standing solidarity with iCAP shareholders. Those did not sell has shown solidarity will be rewarded back later. When the market recover, when treasury shares distributed as share dividend. Good karma.

I have been thinking why I am even to bother to share my views lately......

Let me be clear on the first part of the disclosure so that the fund manager doesn’t think I am working with others with a hidden agenda. In fact, arguing publicly doesn't help me. Thanks to the uncertainties created by the fund manager initiating lawsuits against COL that allowed me to accumulate a small position. But this small position at the rate of compounding return of 15%, it will be more than 1 million Ringgit, 20 years in the future, exit with a discounted of 24% to NAV. Even he is fall short of 15% from his ideal, I will still be rewarded handsomely. It is working against my interest in fact to argue with the fund manager.

For the records, I will still buy up to RM 2.80 just in case the fund manager think I am done with buying and start to promote it. On flip side, in case he thinks I am one of the sour grapes. Again, for the records, even the share price drops substantially from yesterday closing price, I will still making a small profit.

Why can't I air my views during AGM? I am neither eloquent enough nor have a big horsepower intellectually to present my views. I have a terrible public speaking fright because I can't even write or speak proper English....you know, a local graduate ma. I can't get English tenses right, was were, a , the....and also I heard it is very intimidating during AGM for those who present alternate views during the meeting.

The crux of the issue: if the company has allocated a fixed amount of a fund say RM 15 million per year, a-dollar-for-a-dollar, what is the best way of using this fund, should we distribute it as dividend or should we do a buy back or a combination of both?

The pros and cons of options of each option were not presented to all shareholders, instead they will be sold on a canned presentation. I wish the fund manager would have created a slot for experts in their respective areas to discuss about these options. Let the shareholders to hear it. It is perfectly okay with me at the end the fund manager and shareholders go for dividend after the shareholders are given the cooling off time to think about it. We are not in a rush to decide anything. We can do it in AGM 2024 or 2025. After all, those who attracted to iCAP are patient people, we are not here to make a quick buck. I care about the process and system, not the end result.

It is the democratic process, transparency, intellectual decision-making process and diversity and inclusion that I hope to see improvement. Closed end fund is a public company after all. I wish the fund to do well in next 100, 200 years so that my many generations of great grandchildren will inherit a big fortune with the magic compounding. I wish iCAP will be the greatest wealth creator in Malaysian history - creating many billionaires. iCAP is indeed at the crossroad, a crisis creates an equal opportunity to make it a great institution.

Thank you for hearing me out.

"When the facts change, I change my mind" Winston Churchill/John Maynard Keynes

@Tiga i.... what are the 2 ways of making and 2 ways of losing money.....Guru, can you teach us ?

Yes Sir... Thank you for the advice.. Thank you too for the last few posts... I am enlightened. Many gurus here 🙏🙏🙏

@Tigai...I have decided. 24%, permanent discounts...so hope fund manager to tell all investors.. Don't hope for premium. Also don't blame other for spreading negative news with intention to buy more

Really got too go....getting hooked now with this channel now.....

All the announcements that came out just extinguish the flame when people are getting to be aroused...😂😂

But there are too many uncertainties that preventing them to do so.....the potential lawsuits, dividend policy, etc...

So a rational trader should step in and buy now up to 2.8 and forgeting all the complicated stuffs.

Let's say all the holdings in iCAP hit 52 weeks high, it may translate into NAV of 4.1 as I have posted earlier...I will assume people will pay up to max of 3.3 only......just forget about those dividend stuff

But since like Tigai said, we need to get used to 20% discount as a new normal......share price will always be discounted that way....

There is very little earnings(except interest income and dividends) and almost no capex need for iCAP....DCF will be way out to value iCAP....The best way is still NAV to keep things very simple. Added now with the very innovative dividend policy.....like dumbMoney pointed out it adds uncertainty.

Conventional way of evaluating a company that paying dividend is always looking at discounting its Free Cash Flow...FCF is .cash left after paying operating expenses and capex....sometimes it's kind of difficult to estimate for small investors like us because we don't talk to the management to understand all the parameters. A cheat way is using EBITDA.....these Free Cash Flow has to be predictable in order to do that. That is why it is far easier to estimate a simple business with moats with almost no need to buy high tech stuffs to generate these free cash flow. That is why it is far easier to value Coca Cola than TSMC.

A couple of quite comments

>>>>

Chasing Yield + Paying a Premium
= Better Hope there is Someone more Irrational.

>>>>>

Tiga i - witty 😂😂 Best post of the day.....Great Punch Line.... I laughed till I almost fell of my chair....that's what iCAP innovative dividend is......If I know so easy and understandable by all, I will save all my primary school math skills....

iCAP dividend payout formula = base rate + top up rate

base rate = 1% of NAV

top up rate = 8% *(NAV - iCap share price)

top up rate = 0 if iCAP share price equal or greater than NAV

some comments

The yield is heavily skewed towards the discount between NAV and iCAP's share. It is understandable because it is a lot harder to increase NAV in a short time than riding on negative sentiments.

1% x NAV is guarantee because it's impossible to have zero NAV....anything x ZERO equals to ZERO....So to have higher base rate, NAV will have to keep growing.

2. To get another 3% yield from Top Up rate .... implied discount = 24%

It tells you there will be a permanent 24% discounts to get this 3% dividend yield component.

In a zero discount/parity situation. the NAV will need to almost 3X from current NAV to get 4% dividend yield.

You need NAV at $ 10 x 1% = 0.10/ dividend share. So need 10(Implied NAV)/3.53(current NAV) = 2.83 times

Most people will have a hard time to believe NAV can be triple within 1 year and have a very easy time to believe 24% discounts between NAV and iCAP's price to get 4% dividend yield.

It telegraphing a wrong message.....more discounts, higher yield and it's easy to believe. It will keep reinforcing a negative vicious circle.

In share buy back, you buy 100,000 shares in a day- it will attract many other buyers to keep bidding up. It will help to improve the sentiments and reinforcing a positive message. It has a lever effects....4 ounces lift 1,000 pounds. Confidence begets confidence. This is an offensive strategy(proactive to pinjam from dumbMoney).

The fund manager has chosen a defensive strategy(reactive) and sending a very wrong message to the current and potential investors. It will face an uphill task.

I will be out of pockets for a few days.....will miss you all. Take care.

Just to inform iCAP fans that we will not have a fixed mind or Not Invented Here syndrome, if there an idea coming up, we will examine it and not thrashing for the sake of thrashing. We won't reject the idea of dividend idea to close the discounts gap......it is possible to some extend to sell the story of dividend yield. But then, when newbies on-board become oldbies, what's next then? Just like old shareholders original were full of enthusiasm eventually will start selling(due to many reasons), sending it to such an irrational discounts zone. What's next, offer more sweets asking them stop crying? Don't cry, give you higher dividend ya... 😂😂 This is my long answer to my this morning short answer, I disagree.

**To close the gap to 10% will be even harder

My post was directing to what will be the narrative iCAP will sell to new investors or fans to pay for more to close the irrational discounts from 30% to 20%. To close the gap is even a harder sell. Selling the story from dividend yield + future capital narrative is possible. But between this strategy and sharebuy back, I prefer sharebuy back as it is more flexible and don't have to die die commit to pay fix amount of funds in terms of dividend. Human is a very funny creature, if you receive money year in year out, suddenly you stop or reduce the money, they will throw tantrum and send the share price to irrational zone again. Is there a bullet left to bring up the price. ? Was trying to analyze their earning capacity vs how much they need to realize the gains or even sell off some dogs to pay yearly dividend that they committed.

@dumbMoney - great explanation on why there will always be a discount to NAV/NTA because the investor need some margin of safety for something has not be realized. Who knows tomorrow the portfolio will drop 20% or may appreciate 10%. That is why usually 10% will be quite normal in a normal market situation.

Ladies and Gentlemen, boys and girls, so I would like to welcome more iCap fans. We are not thrashing for the sake of thrashing.....we are all just regular guys working from 9 am - 5 pm...try to earn 2 bowls of rice a day. If you are an iCAP fan, don't have to be offended, just drop by regularly .... here is just another outlet for your to hear alternate views.....we are no Zhu Ge Liang....just regular naughty stooges. Have a nice day & good night. 😎

Yearly, typically iCAP will have about 4 million interest income(sitting on about 120 -140 million cash) and ranges 3-7 millions dividend from the shares it owns.....so earning capacity is about 7-11 million, it just nice to cover the management fees, your AGM party fees, income tax and etc...for most of the time. To pay about 14 millions on its investment about 300 million plus, it needs to realize about 4% gains/yearly.

I guess the selling point for iCAP will be dividend paying fund with long term capital gain to attract people to pay more. How much more, we all know price has inverse relationship with yield. 0.10/share dividend on purchase price of 2.54, dividend yield will be about 4%. If they chase the price up to 2.8/share(then we are narrowing the discount to 20% based on NAV of 3.53 ) but then the dividend yield will drop to 3.5%....will people willing to do that comparing to other alternatives? Ya may be possible from this perspective, if they are hungry enough and have great faith in the fund manager for the future capital gains.

The devil is in the details... Ensure tiny guys/gals sign up... Unfortunately all shareholders have to suffer a bit per i3lurker😂😂

rich gets richer, poor gets poor......pure capitalism and not common prosperity....not because it was unfair but that is how people's will make their choice given how the question being framed to them.....

😂😂Ohh....not really..... only a few hundred of investors +/- 900 of the shareholders(27%) may adopt DRIP, the rest may go for cash and see their ownership diluted(not in absolute but % wise)

Who will stand to lose if they don't go for DRIP with incentive say 10% price discounts?

Here is the data based on 2023 Annual Report Analysis of shareholders

No of shares ** # of holders**%
1-99** 132**4%
100-1000** 1,022**32%
1,001 – 10,000** 1,183**37%
10,001 -100,000**640**20%
100,001 to less than 5% of issued shares**221**7%
Total shareholders**3,198


There are 2,337 or 73% of shareholders hold 10,000 shares and lesser....like i3gambler said, those with small quantity usually will elect cash dividend....those with higher quantity will more likely to adopt DRIP. So it will favor those big holders with increasing ownership over the years while the tiny guys/gals of 2,337 / 73% of the shareholders will see their ownership to reduce.

Take another vote again, do you think this will increase the liquidity of the stock over time? 😂😂

Assuming you are being ask to vote in AGM - Yea or Nay 😂😂

Investors should be aware that issue under discussion is eliminating irrational discounts via dividend policy....the expected result is if after implementing this hypothesis....it will reduce irrational discounts(30-40%) to normal discount 10% or a possibility of premium on iCAP share. By intuitions, what do you think?

I reflected on a question by dumbMoney's post.
>>>>
The bone of contention here is not the portfolio or how it has been managed, but more on the discount, and the fact that shareholders sells on discount prices, but managers get paid on full NAV value. But then, the problem arises when the discount is fixed and COL leaves and look for discounts elsewhere, then what is going to happen to their block of shares?
>>>>

The block of the shares will have to taken by somebody else, could be small inventors and can also be big investors……future investors.

I got it now, it’s a governance system and how do we institutionalize a discounts management system. Shareholders can come and go, there should be a set of EFFECTIVE systems or policies that run forever.

My thoughts/comments:

The fund manager is responding. The answer is instituting a dividend policy, payout policy is 1% base rate+8% discount between NAV and average 4 weeks iCAP’s share price. Give the investor an option: take the cash or reinvest them. Sorry, I disagree.

Share buy back mechanism should be considered. My personal strong view: trigger it when iCap is selling at irrational discounts. Don’t interfere when it’s in the reasonable range like 10%, leave it to the market forces to deal with that. Our aim should NOT be zero discount. Provide liquidity at the time of distress(it’s kind of like a “national team”).

A discounts management system must not be at the expense on the fund growth. The fund manager always has an implied goal of 15% in the way he speaks and writes, but I will be extremely happy with 7-10%. Definition of fund growth = portfolio invested in shares + cash AT 7-10% CAGR. I can agree to that, no qualm about it. We don’t have to argue % of portfolio and cash, but it must be taken as 1 body when measuring the performance. I care only the results not the allocation weightage.

Fund liquidation is the last option. IT SHOULD NOT BE USED unless we are in a HOPELESS situation. What is my definition of hopeless: Indifference management and NAV is persistently underperforming the benchmark index and iCAP share price is selling at irrational discounts for a long time.

We are tough on the issues not on the person. 💗💗

Hi John, Thank you for sharing...I considered myself lucky because upon returning again to iCap with a small position, I was in the 3rd bucket but someone just warned me it could be a mirage. May that warning NOT come true😁, just on the lighter side. There are also many others from the phase 2, may their luck will change soon. Jia Yu. 😉

😨😰😭☹

By the way, please do not shoot the messenger. 😂😂

We should also be aware of a major shift with the recent advanced economies inflation that had driven up much higher interest rates. In return, the higher risk free return is raising the bar for active fund managers with many competing products. Retail investors are getting more and more knowledgeable each day .... My child is a lot smarter than me. They ask difficult questions. I personally hope that we can look into all these inputs in a positive light. We are not instigating shareholders revolution but hope to see iCap is a reflection of progressive Malaysia we all can be proud of, as the fund manager always inspiring his followers.