Good Morning, folks! Swamy kid have doing posting in Bahasa Indonesia lately. This is good news! What it mean is he must be reading those bahasa indonesia online news to update himself. Lion caught the indonesia media heavy coverage lately for the wrong reason of bad services like frequent flight delays, passager open emergency exit, passage hold lion staff as hostage, waves of pilot resign, Lion Airport bus got fire etc......

Is this mean Lion Air empire will burst soon or just slowy slowy leaking air bit by bit only........or biz as usual? Is 2.62 is good entry point or exit point, really food for thought.....?

TA Securities provide an update report on AA indonesia on 24 Sep. Key takeaways from the Meeting with AA Indo management are as follows:
i) IAA is expected to maintain its pole position in the international segment;
ii) Its domestic market share is expected to hit 7% by end 2013
from 5% as at 2Q13;
iii) It is looking to close up the margin gap with MAA and TAA, and
iv) The proposed IPO plan could experience further delays.

BB, What to know why TA believe the AAI IPO would further delay, please refer below for full report.

http://www.bursamalaysia.com/market/listed-companies/research-repository/research-reports

Harimau kekekekekeke.. Must be hungry already. Hari Hari Mau makan. BB, please cabut cepat balik to yr cave! Bull or Bear will be target of harimau. AA is up now, you are not suppose out of cave and play play for funs.

BB hide in the dark cave today. Posting some many spaculative Fed tapering postings for the past weeks. Now he just realise that there is no tapering from Fed due to soft US economy outlook.

Price up due to spillover effect from Johor base property player Focul Aim (FA), to be take over by SP Setia Son. FA now trade at RM1.75, NetAsset RM1.20, P/B=1.45. KSL trade at RM2.14, NA RM3.16. P/B=0.67 only!

President Barack Obama said today Russia’s bid to get Syria to surrender its chemical weapons is a “potentially positive development” that could avert a U.S. strike, while expressing skepticism about whether the embattled regime would follow through.

Hmmmmmm.......!! Will this be a pratical solution to Syria Crisis?

So how now, folks?

India Aviation News. Chennei based Spicejet heading Kingfisher way?

Chennai, Aug 30 : .... SpiceJet seems to be heading the Kingfisher way as AAI (Airport Authority of India) has decided to put the carrier on cash-and-carry basis for using the airport facilities across India........

http://truthdive.com/2013/08/30/spicejet-heading-the-kingfisher-way.html

The Happy party still on. 2Q13 result above expectation. Annouce special div 30sen. Total interim div is 40sen less tax.

Read newspaper lately, MAS now dumping biz class fares. Fuel price up already, cannot forever dump economy fares.

Malindo also did not cancel flight so frequent lately. Must be already gotten funding from parents.

In AA 2Q13 Press Release it state the following:

Indonesia AirAsia (“IAA”) posted another profitable quarter with revenue up by 42% to IDR1,398.23 billion from IDR986.52 billion last year. Operating profit saw a 13% increase to IDR87.66 billion from IDR77.65 billion reported during the same period last year. IAA’s 2Q13 profit after tax was IDR51.66 billion – up 72% y-o-y. IAA’s CEO, Dharmadi said “The impressive jump in terms of revenue was attributed to the 3% y-o-y increase in average fare at IDR576,507 and the 29% increase in ancillary income per passenger at IDR151,040 with the highest contributor being baggage. The 33% increase in the number of passengers carried was supported by the 32% increase in capacity translated to a load factor of 79% (up 1 ppt y-o-y). We also saw a good 11% increase in RASK at IDR486.71, while the increase in CASK which stood at IDR456.19 was mainly due to aircraft operating lease expense as we took in 6 additional aircraft y-o-y, and led to the increase in staff cost which was also due to salary increment for pilots and engineers, and minimum wage policy adjustment set by the government.”

With revenue up at 42%!!, It is mean AAI gain huge ground at the expense of Lion Air?

BB, you better do not stay too close to Lion. Bull/Bear will become lion pray once lion cannot find food! Take care!!

THe Truth has been revealed. THe drop of AA yield are caused mainly by MAS aggressive capacity addition (local & international) of 20% yoy on 2Q13. Malindo impact are not as big as MAS. For further details, pls refer to below CIMB FULL PDF Report.

http://klse.i3investor.com/blogs/cimbresearchklse/35271.jsp

In another CIMB report dd 21 Aug 'MAS - illusive profit', it state the effect of aggressive capacity addition has cause MAS’s 2Q13 core net loss of RM213m was worse than 2Q12’s RM181m loss despite lower oil prices. No turnaround expected for MAS in next few years.

Indonesia not enough food, Lion has to come to Malaysia looking for bull or bear. May be disappointed as bull or bear only found in Northern country. Lion may find BB only in Malaysia. hehehehe!!!!

speculative driven. Those want to buy MAS must think twice about their strong Union.

BB will get refueled and be energetic again after reading the following latest news titled 'CAAP suspends Zest Air for failing flight standards'.

http://www.gmanetwork.com/news/story/322367/economy/caap-suspends-zest-air-for-failing-flight-standards

Keeping a pure bear or pure bull as a pet is definitely very dangerous..... However keeping a mix of both, then we are not so sure lor...

Surprising morning close @ RM5.81, near all year high. Any good news? could its be more dividend soon??

Folk, doubt the up coming 2Q13 result will be extra outstanding as the controlling shareholder, Tune Air & TF, has disposal in total 2.6mil share at RM3.18 on 7/8/13. The recent weak ringgit & surge of oil price will impact 3Q13 though real threat from Malindo is receding.

http://www.bursamalaysia.com/market/listed-companies/company-announcements/1374609

BB, careful now! cows being attacked by Lion lately! Bull or bear may be its next target. Be Alert!

Folk, Malindo revealed lately another unique strategy, this time with baggage allowance 35kg for economy class (cannot believe! even more than Emirate of 30kg) for new route to Dharka with one way promotional fare as low as RM399. AA pull out Dharka route few year ago, can Malindo beat the odd?

Let get an inside of the competition level of this route from an article ‘price war on Dhaka-KL route’ dated 2/8/13 , which state as below:

...... Regent Air recently entered the route, a lucrative one for airlines due to the presence of around seven lakh Bangladeshi expatriates in Malaysia. The airline set Tk 27,500 as the starting fare for a round trip, which prompted United Airways to cut its fare to Tk 26,750 from Tk 30,810. And from August 28, Malindo Air, a Malaysia-based airline, is joining the rat race with a round trip fare of Tk21,000. Around 1,600 passengers can be carried from Dhaka to Kuala Lumpur daily then by the carriers. Biman Bangladesh Airlines and Malaysian Airlines, too, operate on the route; round trips with them cost Tk 35,230 and Tk 33,000 respectively. Meanwhile, Biman has offered two tickets for the price of one for roundtrips on the route, as part of a promotion scheme for Eid-ul-Fitr. “We are aware of the increased flights to Kuala Lumpur — and the reduced fares. Biman will, of course, be adjusting its fares too,” said Kevin Steele, managing director of Biman, adding that competition is good for the customers and is “not an issue” for the carrier. But Tasbirul Ahmed Choudhury, managing director of United Airways, said the price competition is not healthy for long-term viability. “It would be almost impossible to survive at such low rates for the local airlines.” ......

With already 4 existing players... ..Oohps! the fate of Malindo in this route already known!

Folk, Always remember Sun Tzi Art of War strategy ‘By planning ahead, we already know the outcome b4 the war started’!

Folk, Be careful! do not take the target price of CIMB & RHB for granted. CIMB is the principal advisor and RHB is underwriters of AAX IPO. They may not be 100% indepedant in their research.

There is no direct flight between Wuhan & KL, how can you consider fligt D7 0393 is cancelled?

Folk, There you go! Remember, never, never, never 'hate' a stock forever by repeating your old postings!!

Folk, Malinnndo is going to launch Dharka Fight on 28 Aug. Until today, the website FRONT PAGE did not mention about Dharka destination. A search of fares, indicate oneway promtional fare RM399 on 28 Aug. Not really a very cheap fare.

Will this route share the same fate of Tawau route, become an adhoc basis route?

Only time will tell!!!.

The New CEO is internally promoted within the firm. He was the head of firm's property management div. Hope he will meet with broker houses more frequently for the preparation of broker house's investment research report (now apparently none so far).

Another news, LRT delay again. This time delay 18 month from 2014 to 2016. LRT delay mean occupancy in Summit Office will remain low. Summit Mall renovation may have to deferred again. Traffic jam continue due to construction of LRT.

Summit Mall is in fact is a 2nd or 3rd grade mall since there are so many strate titles, though it location is good. Traffic jam in Summit can be resolved in the future, but not the strata title. Mall with so many strata title has handicap the management to reconfigure the retail spaces in an effective way.

HariRaya is near... Less flights cancellation expected during this period. Some School even are off from next monday onward...with 2 week school holiday. ...

No sure the details of rulings. But based on what media reported, there is AOC & Biz licence in Msia.

Folk, Malindo announced next destination, Dharka launch on 28 Aug (about 1 month from now), while AAX launch Adelaide is 30 Oct (3 mth). Is 1 month notice adequate enough?

Hmmmmmmmmmmmm! Malindo is really a very different animals. Always creating headlines ...

Folk, want to know what is the implication of airline's chronic delay of flights? Why not refer to below extraction from Jakarta Post dd 30/7/13 on the Indonesia Pacific Royale Airline:

...... Besides the violation of maximum flying hours, Djoko said airlines that violated flight schedules or those reported for chronic delays could see their Air Operating Certificate revoked. “This happened to Pacific Royale, which last week saw its AOC revoked by us because it did not fly as scheduled,” he said.“They will have to request a new AOC to be able to fly again, since their business license is still valid.” .......

http://www.thejakartaglobe.com/news/airlines-to-endure-tougher-penalties-in-push-for-safety/

GREAT REIT NEWS!! Cannot believe! The dividend declared (3.43sen) is more than its income (2.93sen). This must be thank to those smart accountant come with new ideas of 'creative accounting'. In the past, manager fee is is treated as expenses. Now since the manager fee is paid in IGBReit share unit, manager fee expenses would be distribute as dividend!

Really it is great dream come true for many poeple! We can spend more than we earn, isnt it a very good new!

Anyway, It remain to see whehter other Reit would follow IGBReit to distribute manager fee expenses as dividend.

Very high cancellation rate for Malindo Flight. These type of incident only can happened in Malaysia but not Australia, though we have a Trade & Consumer Minister. In Austalia there are law to protect the right of customer and ensure no misleading advertisement.

Malindo Air now turn their focus on ATR biz in Subang Skypark. Due to limited slots and strategy location of Skypark, Turbo ATR biz can be a profitable in median term.

In another new. Malindo Air’s CEO Chandan Rama Murti said the maiden Darka flight will be on Aug 28. “We will carry passengers with a brand new Boeing 777 aircraft. Initially, we will operate on the Dhaka-Kuala Lumpur route on a daily basis,” he said at the inaugural ceremony in Dhaka on Sunday.

Malindo may probably is waiting money from the Lion. Heavily doubt the other shareholder, NADI, will contribute any money further. Though we do not know the exact loss for Malindo, we are able to do some guessing work by making reference on other source of information. Let look at the following 2 statistic of other startup airline:

1. Airasia Phillippine start with 2 plane thorughout whole year 2012, and incurred a total 12 month loss of RM93m.

2. Mandala Tiger start operating from April 2012 with initial 3 planes. CAPA estimate loss about RM105mil (USD34m) for the first 6 month based on Tiger Air Account.

Based on the above reference, it can reliably estimate that Malindo Air 4 month (Apr-July) loss should exceed RM40mil since Malindo has 4 A737-900 and some Turbo ATR. Bear in mind that operation cost in Malaysia is higher and Airasia has intentionally increase domestic route frequency massively to fight against Malindo.

Malindo want to fly to India for non stop 5 to 6 hours range flight, better get enough fundings before start the flight! The loss would be even higher since those flight are non-stop and no India citizen would book Malindo since Malindo has no branding in India. If Malindo simply cancel flight, which India travel agent will book Malindo again? Malindo probably now are looking into all these issue. And as such, Dhaka flight though appear in website for sometime, has not started yet!

CMMT under heavy selling pressure. Outlook are not as bright as before. Gurney Drive mall face direct competition from incoming Paragon Mall. SungeiWang face decrease traffic as MRT construction cause heavy traffic jam. The only bright spot is EastCoast Mall. Doubt any meaningful rebound in share price as future rental revision will be much lower compared with years before.

Folk, Hubline in last qtr March 2013, reported the loss on scrapping of four older vessels is RM 26.2 million. Hubline may have to scap further in coming qtrs. Even though hubline do not scrap the vessels, auditors may press for potential impairment loss on those older vessel value in current financial year ended 30 Sep 2013.

Anyway, the current price of 5 sen look attractive compared with Net Asset @ 30/3/13 at 19sen (on assumption no future warrant conversation).

Want to know more about Malindo. Please refer to yesterday CIMB write up on 'Avaition - What up Malindo?'. Could it be AA price up this morning due to this report?

http://klse.i3investor.com/blogs/cimbresearchklse/33225.jsp

Key for India succeed is India consumers love low fares like Msia, Thailand & Indonesia while in Japan airfares is secondary factors. Also in India, road infrusture are poor and no high speed train.

Suggest to forumers to have vacation in Southern India next time instead of Europe.

The truth of running up of Komark share price lately have been revealed. On 28 Jun 2013, Komark Board receive EGM request from substantial shareholders Lim & Tan, holding 18% to remove all the directors, including founder Koh family. Based 2012 annual report, Koh family were holding 21% in Komark. During the yr 2013, both Koh family, Lim & Tan, buying share in the open market. On 24 Jun 2013, Komark annouced a private placement 10% share, at price not less than RM1, target be completed by 3Q13.

Komark Net Assets @30/4/13 is RM1.52. At current price @ 12/7/13 78Sen, It is mean the share price still GROSSLY undervalue? May be not, since the Komark just breakeven dont make lot of money, not having a great biz model. Somemore, auditors is not big Four auditor and thus cannot give investor adequate assurance that the NA is at RM1.52. Komark has a simple Balance Sheet with Fixed Asset @ 30/4/12 at RM152mil. Bulk of it is Land & Building RM32m (may be undervalue) and Plant & Machinery RM85m.

Anyway, just wait to see whether the share price can move further up and close to RM1 private placement price. Heavy doubt Tan & Lim are able to win the battle since it is unknown how much the undisclosed shareholding are friendly party to Koh family and 10% private placement definitely will go toward Koh friend. In addition, Tan & Lim, based on document disclosed, they are formerly bankers and not involved in the biz of printing. Also, Koh family cannot let go Komark since they are happily taking bulk of director remuneration RM2.8mil in FY2012.

After reading all this, have you already fall in love with Komark?

There is no right issues. It is just seek 20% of sharecapital no share to be issued in the form of private placement, if circumstance required . In the AGM, Amfirst CEO highlight that they have set a clear vision as 'be a leading Commercial REIT'. For the coming yr, emphasis on AEI like renovation budget for Wisma Amfirst RM4mil, Menara Ambank RM25m & Summit Mall RM48m. There is no threat (true?) for Summit for the upcoming mall next to Summit as the said mall is much smaller and attract different segment of customers. Huge supply office in KL is not big threat as AMfirst KL office occupied by Ambank customers, and new supply is more toward higher grade office customers. Amfirst claim Jaya 99, melaka is very good buy with good yield. Target Amfirst gearing 35% to 40%. Claim that Amfirst has strong sponsar like Ambank & ARA (but no mention of potential assets injection from sponsor). Nobody raise the question how the low occopancy rate for some of building to be addressed. Claim building valuation in the book is conservative, which based on investment method in view of high transaction price of similar surronding areas. Claim share price is not reflective of true value of Amfirst as share price do not taking account the low gearing & potential acqusition (no mention of potential assets injection pipeline how can analyst take into potential acquisiton?)

Amfirst has been CONSISTENTLY underperformed its peer for past few yrs like Tower REIT & OUB REIT . Will mapping out clear vision 'to be a leading commercial reit' this yr, enable Amfirst play catch up with peers in term of share price & DPU sooner or later? Should investors continue to give them some benefit of doubt again? Anyway, mapping out a clear vision definately is a very right first stretegic step, in term of biz direction. With the 2 strong sponsors and buildings in stretegic location, there are huge room for Amfirst to improve its performance. Of course, improvement will only done by step & step . Investors' patient is the key..... .

Folk, at this price @1.25, AAX share price is one of the most expensive airline stock, in term of PE valuation. Any negative news will send the share price crash! of course, this is on the assumption that stabilisar manager is off duty. Better stick with its parent Airasia @ RM3.22, with a more reasoable valuation with potential dividend windfall. So far, medium haul LCC is only proven can be marginally profitable, but is NOT yet a very profitable with good margin biz model. It will take many year to fine tune the model to be a very profitable biz model. Ask yourself are you patient enough to wait?

HOTcake IPO! Draw strong institional interest. Price would be driven up by institutional and speculation interest upon listing. Favourable Qualitative factors as follow:

1. Institional offer more than 5x oversubscribed
2. Strength of Sona management
3. Huge success of previous SPAC, hisbiscus & Cliq.
4. onerus moratorium on promoters
5. Predominant draw local interest. Local mkt has excess liquidity.

No risk, No return!.

AA have aggressive plan in India. India currently 80% air booking done through travel agents. There are great potential of India with population of RM1.2 billion, incomplete road infrusture, no high speed train, no comparable real LCC, strong support from southern state govt (Tamil Nadul & Kerala), strong local partner, high domestic fare, Strong AA brand in southern State, focus on underserve secondary town, plan India Football Club, AA India have a very bright future in India.

Based on the above factors, it appear than AA india JV has a good chance to suceed compared with JVs in Japan (high cost & HST) and Phippline (too many players). Therefore with everything go smooth in India, AA future will be in India. Sooner or later, who know, TF might shift it office again! This time from Jakarta to India.

AA share is not moving (up or down), must be MrBB not around. He is most likely went to Chennei and Kochi, South India for holiday. Airasia India will be next hot topic for the coming month.

The best way to judge whether TTB is better than WB is how much investor willing to pay.

Investors have paid more than 1mil to have a lunch with WB. Therefore, to have a lunch with TTB, ideally investor would have to fork out more than 1mil .... lol

Will AA re-enter japan market sooner or later? Below are online new from Chennei, India:

Malaysian low cost airline AirAsia is scouting for a new partner in Japan to fly the domestic routes there after its recent divorce with its two-year-old joint venture partner ANA Holdings Inc, said a top group official.

“We are looking for suitable partners there. There is no time frame fixed for reentering the Japanese market,” AirAsia group CEO Tony Fernandes told reporters on Saturday (29/6/13).

I attended last yr AGM not this yr AGM. Last yr, there are not many shareholders attended the said AGM. probably less than 10. In order to carry out the resolution, due to low attendant of shareholders, can you believe that the directors had to hold their hand up to make good the enough no of votes? Last yr also no much dicussion and ended the agm very fast. After AGM, enjoyed a free buffet lumch in the hotel....

Anyway, Chairman Mr Khoo has deny he will privatise the co few month ago. It is also believed no dividend will be declare as KSL want to conserve bank for land acquiisition.

AA sold Japan JV to ANA at good price, should react favourly by investors. It indeed remove one of the two huge overhang (Japan JV & Malindo Air effect). Recall investor reacted negatively by selling heavely when 1Q13 result report huge loss for Japan JV.

Now banking on softing oil price.... (china can no longer grow as fast as before which pushed up the commodity price by then), let see will AA share move faster?

AA price drop back to Rm3.32 from RM3.40 this morning, may indicate market are not so excited about AAX. AAX prospectus indicate 2012 in fact report loss if we exclude foreign exchange, no doubt 1Q13 show improving result. Now, they are banking on favourable market conditions (eg softing oil price, KLCI record high) to market the AAX share at RM1.45.

Judging from the above, at current price RM3.32, AA is safer bet than AAX.

AA may declare again special div if AA Indo get listed by 4Q13. More planes can be sold from AA to AA Indo.

AA boss may need more money as they are struggling to succeed with ‘extra-curricular’ sporting adventures. QPR was recently relegated from the EPL, while the Caterham F1 Grand Prix team is currently ranked 11th (out of 11) in this year’s F1 championship

Share overhang in KSL continue dragging the performance of its share price. Lembaga Tambung Haji still holding 19.8m (5.1%) share in KSL at 3/6/13. LTH Sold 1.4m shr in last friday 31/5/13 and 2.2m shr in Monday 3/6/13.

However, there is no disposal of any shr from controlling shareholder, Ku family from beginning of this year though price has gone up a lot.

192mil stock is at June 2012. RM142mil is at Mar 2013. Take 9 mth to bring down the stock level. No sure whether is an improvement. June 2012 build up may due to HariRaya sales in 3Q12. Drop to RM142 is after CNY. The only indicators is sales GP margin drop from 52% to 49%, may due to stock clearance or intense competition.

Retailer always build up stock b4 festive season. Clear stock after it.

1Q13 result out: Sales up 80% Yoy. Profit before tax also up 80% yoy. Proven KSL a efficent developer with fast turnaround time from landbank to profit.

1. AA Exdate for Div 6 sen tomorrow 31/5. A lot of buyer now because of alot of seller last few days.

2. AA Japan (AAJ) has harder challenges to face. AAJ CEO Yoshinori Odagiri say 'cost has proven to be our toughest challenge but believes this can be driven down once more economics of scale is introduced.'

It look like AAJ would continue to incur huge loss for a long period in view of economic of scale will take time to build. Current AAJ only has 4 planes.

3. AA Management believes Malindo’s business model is more similar to a full service carrier and will directly compete with MAS in terms of commonality of business model and routes. AA has reduce Malaysia additional fleet from 10 to 6 fleet in 2013.

Malindo extra length 32' seat mean more suitable to compete with MAS. There is a good chance that AA yield will continue record good growth in coming quarters due to limited competition from Malindo, Najib 's BN win over election and softening oil price.

Airasia claim Japan JV has failed. What AA is going to do? below interesting points reported from Reuters on 25/5/13:

Fernandes said AirAsia hoped to resolve differences with its partner All Nippon Airways in the next few weeks but did not exclude a break-up of the venture, which allows each partner to pull out with its investment protected by the other.

"The model will work. But I'm not sure our partnership and the way we will run it would necessarily work. We've got to be aligned on that and we're hoping to be aligned. I'm moderately optimistic that
we can make it work," he said.

"If we agree in a couple of weeks time then we just go do it. All our other affiliates have made money, Japan should be no different."

Asked what would happen if the two sides failed to reach an agreement, he said, "Then we'll have to part ways, I think".

The weekly Edge dd 20/5/13 interviewed with TTB reveal some interesting points:
- TTB now focus on 2 global funds, icap global fund & icap international value fund.
- Icap have office in Sydney, Spore, HK, KL.
- TTB spend most of his time on road visiting companies around the world.
- TTB claim he has a unique way of running his fund. Support by a large team of analysts, he is the ONLY decision maker. It is a 'ONE MAN SHOW' with no investment committee and no one with different views.
- TTB claim Najib election result is worst than former PM, fear be replaced in the coming umno election.
- TTB expect KLCI could slump to 1000 to 1560 from current 1783.
- TTB work 7 day a week and work even harder than 24 yr ago when Capital Dymanic was formed.
- TTB plan is don't want just be a global company, want to be true global fund manager from Asia.

The 20% discount is most likely due to 'consistent underpeformance' of icap over the last few years. When a fund can consistently beat the market, investor will like the fund and the share price will be trade at premium over NAV like early day of icap.

MrTTB most likely adopted the china-man style management. In early day of icap, he only has one fund to look after. But now, he may have over-stretched him as he need to take care of so many funds across different region.

The 20% discount will mostly continue to persist unless the fund can perform better or a winding up expectation be initiated by shareholders.