@stncws, even if the vaccine comes out tomorrow, considering the usual lengthy timeline for vaccine development, is it gonna be reliable? and what about the amount of time needed to manufacture and distribute to the whole world? We are talking about the population of the whole world here. Gloves and masks will have huge demand in the meantime.

It seems that investment banks are trying to do something to reduce to share price so that they can collect more from the market. And one thing is that whenever the share hits a new high, there will definitely some news come out to dampen the price.

From what I read online, the purpose of the reduction of haircut rate by the banks is to reduce the banks' exposure to glove counters. The only impact is that the share buyers, who want to use margin finance to buy shares of glove companies, need to use more of their own money rather than the bank's money. It does not mean that Comfort should be valued at RM 2.29 (valuation by Maybank) and RM 2.35 (valuation by RHB) because the fundamentals of the company and the industry prospect has not been changed.

If we look at the industry prospect,
1. The vaccine still takes a long time to be developed, manufactured, and distributed.
2. Many countries have started to open up and that sadly, but surely increase the case number.
3. The norm will be changed after this pandemic. Glove consumption and mask consumption will increase as their usage will become a norm in future, or at least the near future.
4. Many businesses declare bankruptcy in this MCO. In other words, unemployment rate will increase and the purchasing power will be weakened. The prospect of many industries will be negatively affected in the near future. So, the only industry which can generate promising prospect in the near future is glove industry. That's why I think it is best to put money here.

I'm sorry I am new to stock market. May I know is my interpretation correct?

@Croxxx

I mean the reduction of haircut rate by the banks circulating on the internet today. The news seems to dampen all the glove stock prices.

I'm not sure if my understanding of the situation is correct or wrong.

1. Let's say a man whose name is Watson buys Comfort shares with margin and with his comfort shares as the collateral at a previously higher haircut rate provided by the bank.

2. Today, the investment banks, maybe were alarmed by the high PER, suddenly reduced the haircut rate of Comfort shares.

3. The banks' action directly reduces the amount of Watson's collateral and he has to sell some Comfort shares so that he can meet the collateral requirement of the bank.

4. Unfortunate, there are many big players who buy Comfort shares with margin and they have to do the same thing. That's why the share price dropped.

5. The sudden decrease of Comfort share price in turn causes panic sell among some uninformed shareholders.

6. However, the decrease of the haircut rate does not mean that the fundamentals of Comfort or the situation about the pandemic has changed. The demand for gloves still exceeds supply.

7. And those bought Comfort shares with margin were merely forced to sell to meet the banks' collateral requirement.

8. So the price drop might end once their collateral requirement is met.

May I know is my understanding of this situation correct?

Hasn't the market priced in the expected loss in this coming quarter? Cos everybody knows the coming quarterly report is gonna look bad when they were willing to buy at a higher price today.

I wish I have more bullets now. XD

Omgggg....seriously out of my expectation. Luckily I didn't buy it with borrowed money.

no eyes see.

is that link above malicious?

Will the increase in cement price have any impact on OKA?

300 shares meaning 300 lots?

I see. Gong Xi Fa Chai!

Why do you sell so early EatCoconutCanWin? Lol

I think if the coming quarterly report shows drastic increase in profit, there is a high chance for the share price to shoot up.

Lol. where did you hear the news from?

I think you will see the breakthrough after CNY before the release of the quarterly report. (Many would have predicted improved results for this counter).

The following is an extract from the financial report 2019:

Future Outlook and Prospects

Whilst the outlook for the coming next few years for the Group remains challenging amidst the intensifed competition, unresolved global trade conflicts, potential slowdown in the Chinese economy, volatile commodity prices, downside risk of the Malaysian economic growth, these weaker expected climate in terms of business confidence and consumer sentiments will inherently put a damper on the outlook of the Group for the FYE 2020.

However, following the new government’s anticipated projects to build 100,000 affordable homes by the end of 2019 and one million budget houses in ten (10) years’ time, OKA’s management team will endeavour to secure a fair share of these projects. (This is the main part)

Do you think will the February quarterly report bring us good news?

Hopefully the trading volume will sustain until the price go beyond my average price. The NTA per share of OKA is RM 0.74. With EPS of RM 0.0508 and DPS RM 0.037, basing on P/E ratio of 15 (which is considered quite low if OKA can tap into the big projects in the pipeline), I think the intrinsic value of OKA is at least RM 0.95. So, whether or not the trading volume sustains tomorrow, I'm gonna keep buying it. XD.

There is no way for tiny shareholders to know what's going on inside. However, with the track record of the management, I'm confident that OKA will benefit from the project one way or another next year. I'm quite optimistic with the projected performance.

https://www.theedgemarkets.com/article/cccecrl-ramp-construction-work-1st-quarter

Construction activities for East Coast Rail Link (ECRL) will be ramped up soon in Pahang. Jobs for the subcontracts are expected to be awarded in the first quarter of next year.

More and more tenders will start next year. I guess the gains will soon be reflected in the financial reports next and hopefully, the share price will follow suit. :) I have been buying since the beginning of 2018. Hopefully my decision is correct! XD

when 70% of the shares are held by the big shareholders, this is what happens. Not much transaction can happen.

You're welcome SHQuah. Below is a small part of the conversation from the question-and-answer session from the latest AGM.

Shareholder: Pages 44 & 45 of Annual Report showed a big drop in the receivables, deposits and
prepayments whereas the payables and accruals decreased by a small amount compared to previous year, is this a fair reflection of the economy in the industry? With the drop in turnover and receivables, what is the outlook on the prospects of the industry you are in? What is your prospect for participating in the ECRL project and other upcoming projects?

CFO: With regard to prospect, given the current slow-pace economic situation, we have to work hard to procure orders. The progress of ECRL is not going on as much as desired. There is currently a slow trend in construction industry. Accordingly revenue and profit have dropped. Lower sales will also result in a dip in trade receivables. In addition, for trade receivables, Note 8 explains that only secured debtors are recognized while loss allowances are made for expected credit losses, based on probability-weighted estimate of credit losses, taking into consideration historical past due aging for the past three years.

Shareholder: The trend of housing projects seems to gear towards low cost housing, will the
company benefit from such projects?

CFO: As long as there are development and more projects, the Company can benefit from
them.

Shareholder: Do you foresee the construction industry gets better or worse?

ED: We do see some light, it gets a bit better, though not able to achieve similar results as in previous years. Take for example the ECRL project which was announced 2 years ago. Though it was awarded and started, the progress is slow. This situation is out of the Company’s control and difficult to predict. If all the government jobs kick off, then we are confident of better prospects.

# The conversation above tells us about the status of ECRL and OKA's involvement in it. Besides, it also sheds light on the management's confidence once the government jobs kick off which could probably be next year.

Just to share an old article with you guys here. I think it can sort of enhance our belief in this counter.

"Expect progressive improvement in sales once the new factory is in place. Recall that OKA recently announced the acquisition of a 3.6ha vacant land, adjacent to its present factory in Senai, for the construction of a new factory. The acquisition of land is expected to be completed by 2QFY19. This new factory is expected to cater for more orders, given the expansion of production capacity, which may support its revenue growth moving forward. — RHB Research Institute, May 30"

https://www.theedgemarkets.com/article/okas-new-factory-expected-cater-more-orders

It's most probably related to RTS as OKA owns a factory in Johor. XD

Bandar Malaysia will proceed too.

https://www.thestar.com.my/news/nation/2019/10/12/budget-2020-bandar-malaysia-project-in-sungai-besi-will-proceed

Rapid Transit System is officially resumed.

If the trading volume sustains, coupling with the good profit in the next quarter, I think the price will fly soon.

https://www.thestar.com.my/news/nation/2019/10/11/budget-2020-construction-industry-happy-expects-growth

It seems that there's no seller willing to sell below RM 0.62 now.

not significantly high though .

The directors bought some from the market today. Maybe that's a good sign?

I got it from the annual report. By the way, the data about Capex is my calculation based on the formula on Investopedia. I'm not sure if I did it correctly . :)

I see. I didn't read clearly. Thanks for your info. :)

Let's consider the Capex of the company:
2015 - 2016: 4,401,453
2016 - 2017: 4,845,879
2017 - 2018: 4,133,473
2018 - 2019: 13,681,212

We can see that the company has spent a lot on upgrading its production facility. Keeping its strong fundamentals and excellent management in mind, I think after the mega projects are revived, the company's future profit might surprise everyone in the market.

great! thanks for your info SHQuah! I buy almost every month to average down my price!

I'm curious why investors are not into this counter. Does anyone have any idea? To me it's a great company, isn't it?

cyeec2000, is the information still valid today? I check the 2019 AR and RHB Capital Nominees (Tempatan) Sdn Bhd is the 11th biggest shareholder. Maybe Leng Yan sold all his shares before the share price plummeted. Lol.

Wow...Leng Yan is one of the biggest holders? That sort of calms down my mind a little...hahaha...I have been buying OKA monthly though..hopefully it will pay off soon..how do you know that about Leng Yan though? Where can we find that piece of information?

My stocks have been stuck since the last GE. Sunway and OKA. Lol

SHQuah. Are you alright ? Lol

Adjusted bonus issue? Is it mentioned in the company announcement ?

Actually I start to see the presence of OKA construction materials in SP too. Maybe that's a good sign.

I see. That's a relief then. Hopefully it will fly soon.

It feels like the current surge in the construction industry has nothing to do with OKA. Lol

i see. thx buddy.

May I know when will we get the dividend?

topping up!

YAPSS Your video is awesome and helpful. I am your follower now. :) Keep up the good work!

fxxk...This counter is fxxxed up...