Target price RM3?
kcchongnz wrote the following

Focus Lumber is another great company. Just before it announced its third quarter results for period ended 30th September 2015 somewhere on 17th November 2015, its share price jumped by 70% within 3 months from RM1.84 to a high of RM3.09 on January 12 2016 as shown in Figure 2 below. 

The results show the vast improvement for the third quarter 2015 with net profit increased by more than 200% from RM3.3m to RM9.6m for the corresponding period in 2014. EPS, as a result, also increased by more than 200% from a EPS of 3.2 sen to 9.4 sen for the quarter. 

Some investors who purely base on a single metric of “Profit growth”, without considering where this “growth” comes from, saw a great opportunity and annualized the EPS by multiplying by 4 to the single quarter exceptional result and obtained an expected EPS of 37.6 sen for the next 12 months, and chased the share price up to more than RM3.00 in early January 2016. 

However, many do not care about its financial statements and failed to see that the greatly improved result for the third quarter of 2015 was in a major part, due to the gain in foreign currency as a result of rising USD against Ringgit from the beginning to the end of the period, a one-off item.

When the next quarter showed a reduced profit from the preceding quarter due to some recovery of Ringgit against USD, investors dumped its share, resulting its share price dropped more than 30% to less than RM2.00, in less than two months. It closed at RM1.72 on 19th August 2016. They would have lost a total of 44% in less than 8 months.Again paying too much to chase the illusive growth story, without understand where the “growth” comes from, is hazardous to one’s financial health.

At RM1.72 now, I think Focus Lumber is a great value stock to invest for long term. But why is there no interest in this stock? Once bitten twice shy?

Master sifu said Focus Lumber is a great value stock to invest for the long term. Target RM3?

"At RM1.72 now, I think Focus Lumber is a great value stock to invest for long term. But why is there no interest in this stock? Once bitten twice shy?" -Master sifu kcchongnz

"At RM1.72 now, I think Focus Lumber is a great value stock to invest for long term. But why is there no interest in this stock? Once bitten twice shy?" -Master sifu kcchongnz

Posted by paperplane2016 > Oct 20, 2016 01:16 PM | Report Abuse

whats inside Mark Chang closets, I am interested to know. Innity recently acquire some companies, JCBNEXT might acquire similar?


paperplane2016, we will know by 1Q. Cheers!

Posted by paperplane2016 > Oct 14, 2016 02:15 PM | Report Abuse

see? Mark Cheng wrote all these! he is such a honourable person to work will. I AM WILLING TO PARK my money and sleep well with him, knowing he is a responsible. He still young, he GOT MANY YEARS TO go. Grow with HIM, that's my thought


I agree with paperplane2016. Mark Chang is such an honourable person. He sold Jobstreet for RM1
9 billion and paid everything out to shareholders. You cannot compare jcbnext with those stocks.

Where are the cashflows? No cash, how to pay dividend?

But its a good price to enter if you can hold for 5 years, not 5 months. Just my 2 cents.

Icon, oil prices are falling. Will there be more provisions? I bet so.

Cutting opr by only 0.25% will not spur sales of property. Banks will not reduce lending rate by same amount. Most had increased lending rate by 10-20 basis points. The real problem for property market is AFFORDABILITY. Buyers beware!

Good results

Koay and comrades, updated post for the next gem!
http://klse.i3investor.com/blogs/benjamin/64067.jsp

KSL is now selling at cheaper valuations after my last article. TP maintained at 7.20. The Edge has a 2.6/3 fundamental rating for KSL! http://www.theedgemarkets.com/AA/dashboard?0=5038

Thanks guys!!Please spread the link so that everyone knows about this gem. hold for the long term.I believe KSL will show record earnings next year! Till then.Cheers!

my latest article is up. comments are welcomed!

Hi guys, i will update KSL very soon! TP revised!

I dont post much cause I am a longterm investor. I am not much into trading. And to stay away from herds.

I'm doing great stkoay. I am just a small time investor who likes to buy undervalued and underresearched good to great stocks. I have no insider news. Just my 2sen based on my analysis n facts. Just have to do more homework to uncover these gems. Their projects can be seen in their website. Since KSL has met with fund managers and analysts, which was widely known, most probably they will come out with Strong BUY, right? If cimb initiates, it will fly to above RM6 in no time. What do you think?

Well said upsidedown! Bonus issue is just cutting a same cake into more slices. Berkshire has never issue bonus shares but still selling at great valuation. Less shares are better than more, liquidity for KSL is good enough. I am going to post my new target price soon, to take into account another 500million unbilled sales targeted by end 2014.

Some local research houses are going to come out with Buy call on KSL very soon. Never too late to buy for >30% gain! Patience is virtue.

For comparison sake, UOA has a GDV of 18bn vs KSL 40bn. UOA Market cap >RM 3bn vs KSL RM 1.5bn. Bear in mind KSL has recurring income of 17sen/share, which will triple after KSL CITY 2 open for business. You be the judge.

The edge weekly reported KSL to pay 30% dividends soon! Unbilled sales 1.5bn! Assuming 70sen Eps, dividend per share comes to 21sen or yield of >5%! Limit up this Monday?

http://klse.i3investor.com/blogs/kenangaresearch/58195.jsp

Short term traders should leave this stock. It is not a trading stock but a fundamental longterm holding. Buy more on weaknesses! KSL is starting to advertise here for KSL City Mall 2 with 1.8mn sf area. Can't wait for 2Q14 announcement most probably next week. Possible dividend to be declared. Cheers!

@stkoay that is from property development only. Add in 17sen EPS from investment properties, a conservative 15% growth from last year's 15sen. U do the math how undervalued is KSL!

http://www.tongkooiong.com/2014/08/tong-kooi-ongs-portfolio_15.html?m=1

The astute investor, Tong Kooi Ong, formerly of Sunrise n UEM Sunrise, holds KSL in his portfolio. It says a lot for KSL to have him as shareholder! Notably, Sunrise was also undervalued before UEM's takeover.

With a target price of RM4.90 to 5.60 for KSL, the warrant appears cheap at <5% premium only! Fair value of WA is at least RM3.30. Thats >80% return!! No wonder big funds are accumulating.

@5w33 go read their 1st newsletter at bandarbestari.com for more info.

yes stkoay, in the short term, the market is a voting machine. @stkoay and KSL loyal investors, my latest article on KSL is up!
http://klse.i3investor.com/blogs/benjamin/57379.jsp

I dont know @matakuda. What i said was if they buy into KSL, the realisation of fair value would be swift and may even go to 20x PE valuation. If you look at their holdings, most are selling at premium to book value. But they purchased at big discounts initially. LTH selling is not a concern, they are not value investor, unlike Public Mutual and Julius Baer with holdings since 2007!

Buy call for KSL-WA with TP of at least RM 3.32! With mother share TP of RM 4.90-5.60, KSL offers more than 100% profit! Better than the already great undervaluation of mother share. Maybe Aberdeen Asset Management is heeding our advise. @stkoay

@stkoay thank you. Any link to it?

With Julius Baer, Public Mutual and LTH cumulatively hold >15% stake in KSL, it will not be easy for the management to takeover at below book value of RM 3.46. Initially, KSL management needs to offer at least 10% premium or RM 3.80 if they really keen to buyout. Why the premium? KSL has been making above average returns to shareholders for the past 10 years. KSL will have a STABLE recurring income of 17sen/share or 4.5% yield at RM3.80, from investment properties. Last year, KSL made 15sen/share, mostly from KSL City Mall and Hotel.

A fair value for management buyout would be at least 20% premium or RM 4.15.

Before everyone wants to join in the party at Iskandar, forward looking KSL has ventured into the Klang Valley and KL. Today,majority of its GDV is in the KV, worth RM 5 billion! Plus its KSL CITY MALL AND RESORT is generating recurring income of RM200mn/year! KSL will build KSL City Mall 2 in the KV, expect recurring income to more than double as net lettable area will be 3 TIMES more than KSL City Mall at Johor!

@stkoay calvintaneng strikes back! at http://klse.i3investor.com/blogs/benjamin/ LOL

@stkoay recap on KSL
http://klse.i3investor.com/blogs/benjamin/

KSL-WA seems underpriced at 1.20! It reached 1.45 in Feb when the mother share was selling at 2.53. It should be selling at at least 1.48 or premium of 20%. Its warrants will be due only in Nov 2016!

KSL is expected to make RECORD profit in 2Q14 due to the completion of Phase 1 (GDV RM 386mn) at Canary Garden, Klang in June this year. Phase 2 of the RM 5 billion project is in progress, which includes commercial properties. Also, several projects in Iskandar region are in-progress, such as D'Inspire Residence (http://ksl.my/dinspire/progress.php), and township development at Nusa Bestari, Nusajaya (http://www.ksl.my/bestariheights/site/master.php) and Kempas Indah (http://www.ksl.my/kempasindah/site/psp.php).

New developments expected to kick off in 2H2014 include D'secret garden (http://ksl.my/dsecretgarden/) KSL Residences@Daya (http://www.kslresidences.com/images-gallery-ksl-residences/)and 18 Madge(GDV RM 200mn) near KLCC (http://18madge.com/). KSL also build affordable houses at smaller towns of Muar, Kluang, Segamat and Labis.

With second quarter EPS expected at a record high of 19.6sen (+15% y-o-y), first half 2014 EPS comes to 35sen. Annualised EPS is 70sen. At current price of 2.44, KSL is selling at a very low PE of 3.5x. Ascribing a PE ratio of 7-8 times for midcap property player, the fair value of KSL is RM 4.90 to RM 5.60. Given that it is selling at >50% discount, KSL is a no brainer investment for Graham or Buffett-like investors.

You're welcome stkoay! Any KSL shareholders attend the meeting today? do enlighten us!

Last week, KSL was recognised as one of the TOP 10 DEVELOPERS in MALAYSIA year 2014 by BCI Asia! Great news!

The BCI Asia Top 10 Awards provides an overview of the regional building and construction industry by recognizing the top architectural firms and developers that had the greatest impact on the built environment in Southeast Asia.
http://www.bcitop10.com/index.cfm/top-10-developers/2014/malaysia/?countryid=4&year=2014

Thank you stkoay! I think I cant make it to the AGM. It would be great if those who attend can share the meeting minutes here. Thanks in advance!

Change in CL -ve usually means cash outflow to suppliers...but in this case, its due to dividend payable..cash inflow mainly from conversion of warrants..no dividend compared to 0.8sen a year ago..may take a hit tomorrow.

Also, more cash is coming in the next two quarters. Look at the trade and other receivables! Plus the completion of the first phase of Canary Garden development. Assuming RM80mn cash inflow from trade and other receivables in the 1H2014, cash will increase by 20sen.

if you look at earlier buy vs sell volumes, smart money are accumulating.. more than RM 8 million BUY, couldnt be retail investors. foresee privatisation offer in the coming weeks. KSL could offer price below RM3 but it definitely wont go through due to large institutional holdings. be greedy when others are fearful. ACCUMULATE!

smart money are accumulating..most probably privatisation offer very soon!

The reasons for its high GPM and NPM are low land cost and direct purchases of materials. Revised NTA is between RM5 and 6. Foresee KSL to pay dividend this year! Target price is at least RM4.

besides Iskandar, KSL has ventured into the Klang Valley and KL with GDV of RM 5.2billion! These lands alone are worth more than its current market cap! DOUBLE THAT with KSL CITY MALL AND RESORT! PLUS you get more than 1,500 acres in JOHOR for FREE!! Easily worth RM 5 to 5.50 revised book value!
For MKH, its making HUGE forex losses last year due to depreciation of RUPIAH! good point is maybe the worst is over for its plantation business.

fyi, MALTON land is right beside IKEA land!

like i said b4...bonus issue is not a good move; issuing bonus shares at earning yield of 30% when you can issue debts at a cost of 5%? think about it.
it would be better for them to issue some dividends or start share buyback. longterm investors would prefer the latter as it increases their shareholdings as well as EPS.

iafx KSL D/E is less than 20% only! If they revalue some properties, EPS can easily go above 80sen.. but normalised EPS of 60sen is a better bet. even at RM 4.80, it is not expensive at 8x PER or 12.5% earning yield.

WAT-A-TIME to diversify into sunset sector!