Digi is always in my active data base. I want to buy and hold Digi for a very long time already but the timing is just not right or maybe we have no fate(缘份). After reading this article, I take a hint that telecommunication stocks like Digi may have risk if it is not creative in introducing new products in fast pace. The safe conventional revenue from voice calls and messages will be badly threatened by the creative and pervasive internet. I will keep this article under Digi for future reference.

Friend, this is the way I do homework as preached by Cold Eye.

If the broad market is not changed, and the price drop in a counter is due to non severe changes such as Genting which is facing less attractive earning due to GenS and palm oil, I will normally average in after the price downs by 10%.

When the broad market corrects downward, all good counters drop too, just different in magnitude. I will assess few things before averaging cost down on the same counter.
i) There are no better counters. Example, I like Zhulian(in the existing portfolio), but if at that time Maybank drops more than Zhulian and provides better valuation than Zhulian, I will buy Maybank(new to portfolio) instead of averaging cost down on Zhulian.
ii) Exposure to that counter and industry. Example if I have too high exposure on MLM, I would find other counter in other sector for diversification.
iii) Fundamental of that good counter is still intact, solid and visible.
iv) The outlook of the macro economy is not facing high risk, else all good counters may drop further.
Thks

Tan KW : I believe you are a very strong follower of Cold Eye as you are very familiar with his articles and you always can quote outright spot on article. I am very happy to know you as a same fans of Cold Eye.
Thoughts sharing:
Thought 1: If I do not want to become a drinker, I try to distance myself from drinking circle as I know if I close to them, one day I will be influenced and become one of them as I do not want to cheat myself that I have a very strong self-discipline.
Thought 2: There are now many aunties and uncles on the street talking about shares. What is the implication? (Any article from Cold Eye on this?)
Thought 3: When I am too close to the market, I cannot see the true picture and tend to dance along and get lost eventually. (Can you find article from Cold Eye related to this?).
Thks

Thought sharing LIMITED to those who believe in Cold Eye: "if the market is predictable, there are no beggars on the street. and 《大時代丁蟹》劇集would not be interesting as the market is predictable”.

Hi Tan KW: I perceive that you are a strong follower of Cold Eye, maybe I am wrong. I do not think Cold Eye encourages people to put 80% of fund into Bursa especially during the hot time as current. If it is a crisis time (=Christmas Sale), I will almost all in by stages. For this year, I almost do not put in any new fund except switching counters. Instead one dilemma is bothering me each day that if I should I sell now and wait for the next bear to go in back. I do not want to earn hot money as those technical players who earn by catching the flying bull and stay far away from drowning bear. Whereas I stupidly “TRY” very hard to be a contrarian to lend helpful hand to the poor bear and drowning along instead of fueling the up high bull. What do you think?

I cannot provide solid prove on why I have poor perception too on VT. But I opine that if a super tycoon at senior age, having unpopular image in his community, is a SAD thing. One is not necessary to make good thing if he does not want to but at least do not let large group of people think that you made wealth disgracefully from the ordinary people.

Hi Notion : I am with you for the last 3 years and suffering 28% on paper loss, let alone opportunity cost of the bull run for the last 2 years. However, I am still having faith with it. Hopefully Mr Choo and Mr Too do not down us, the royal investors. Cantonese said : 好心你, 挣气滴啦, 好没 ?

Hi Paoblocrk : your view on the prospect of PIE is spot on. I totally share your view and for the same reason I switched PIE to GTronic in March 13 after holding it for more than a year. Nevertheless, I opine that for those who are just looking for relatively consistent and higher yield than FD, this counter can be a good option when there is a downward correction to RM4.0-4.3.

Hi Kutty : Div in Sep 13 is 76 sen @ 2.36= 3.2%. Is it better than bank ?
I forecast eps of 2013 is 23sen. With committed minimum 40% DPO, div for 2014 is 9.2sen=3.9%. Eps for another year will be 26sen and div 10.4sen=4.4%. This yield may not be attractive to investors who go in now but since my average entry price is lower, my yield is higher and it is about similar to rental rate from a normal shop. So I treat Mahsing as a shop which gives reasonable rental while appreciating along.
The most critical condition is that its business continues with the current trend which is something I need to follow up closely.
Good luck.

Hi Sasopi87 : Are you talking about Mahsing ? If yes, how long have you waited?

Just would like to share with you that I started to follow up this counter since 2007 and started accumulating since Sep 2009. Only until 2013, I see a significant movement. I will keep this counter for many years down the road if the trend of its business continues. Therefore I conclude that long term investment is a lonely game. What do you think ?

Can somebody shares me an article about “Investing is a lonely game”= 股票投资是寂寞的.

I long for article from Cold Eye each day by browsing NanYang. I really hope for an article from him sharing his view on the current bull market. He thought a lot on how to invest but not so much on how to sell except one of the article said to do so when PE > 15x and when the fundamental has deteriorated.
Thousand thanks for this article.

It is a very good write up, I benefit a lot from it, THANK YOU. Nevertheless, as a prudent value investor, I opine that if I invest based on just one potential or self-expected good prospect of a company especially on the company which is known operating under high debt and tough environment, the risk of failure is very high. It is no worth to invest into. Just my 2 cents opinion.

There are lots of good prospects on Zhulian, one of my favorite counter. It is relatively a very good and safe counter to invest into. Lately, I have a dilemma if to further accumulate at the current price. Why?
Some Gurus said that while investing, first thing to think about is not to lose money before thinking how to make money. In this perspective, now is not a very safe time to buy Zhulian as if we check thru the historical PE, Zhulian were traded with PE below 10x except the bull run in FY12. If the forecasted eps of FY13 is ~30sen, the safe price shall not be higher than RM3 with PE not more than 10X. I would feel safe to go in at RM2.40 with PE 8x. I will see it as “Christmas Sales Offer price” at RM2.10 with PE 7X. Can I get it ? This is a game of patient and luck.
If the current bull goes up further, I believe I will lose the opportunity of making more money from this relatively safe counter since I do not buy now. However let us imagine, if S&P and Moody downgrade our credit rating as Fitch in the upcoming few months, how chaos Bursa will be? I foresee Zhulian may drop to RM2.40 then and the golden time to buy emerges.

KC :
Whereas for Fibun, to me, it is very risky. As I am not good in English writing, it is hard for me to express my view accurately in detail. But the below are something in point forms, hopefully you can connect the points by yourself:
i) close family, high risk to screw up your money, nobody to check and balance.
ii) All family members, indicate shallow mindset of the owner, unlikely to grow in creativity , efficiency etc.
iii) Close family, risk to have inner fighting among them
iv) Close family, difficult to attract talents
v) Many companies cheated on numbers especially this type of close family and small one
vi) Too small, cannot stand big blow such as financial tsunami if there is any or internal company crisis.
vii) Marginal profit : can easily swing to negative if something wrong i.e. one or two big clients do not pay you and run away
viii) Their education background and experience : not professional, can do small business but unlikely to grow big
Thank you.

KC : Pls do not get me wrong. I am very interested on your fundamental analysis. I did not put up comment on CBIP is because that reason (discomfort) on CBIP is not strong. I did not go back to dig it out from the cold storage but from my memory, it was something related to its business model. I dislike the non-recurring income or project basic income.

A small but real story happened to me: “nowadays, business environment is very competitive; everybody is doing cost cutting. The supporting industry (such as CBIP which design and build oil mill for others) is difficult to get recurring orders as the manufacturer (buyer) will get your first unit and then finding creative ways to cut cost by either getting others to build the same with lower cost or build it in-house or press your cost down for the subsequent order.”

As I prefer companies which are safer and for longer term, I opt not to follow up CBIP, even thought my return is slower.

Whereas for Fibun, to me, it is very risky. As I am not good in English writing, it is hard for me to express my view accurately in detail. But the below are something in point forms, hopefully you can connect the points by yourself:
i) close family, high risk to screw up your money, nobody to check and balance.
ii) All family members, indicate shallow mindset of the owner, unlikely to grow in creativity , efficiency etc.
iii) Close family, risk to have inner fighting among them
iv) Close family, difficult to attract talents
v) Many companies cheated on numbers especially this type of close family and small one
vi) Too small, cannot stand big blow such as financial tsunami if there is any or internal company crisis.
vii) Marginal profit : can easily swing to negative if something wrong i.e. one or two big clients do not pay you and run away
viii) Their education background and experience : not professional, can do small business but unlikely to grow big
Thank you.

It is hard to get 莺莺美黛子, not to mention with high growth potential especialy at the current high mkt. I do not have many 莺莺美黛子 in my portfolio. I am a very faithful guy who loves the selected counters for very long term, majority of them were collected since 2009 till today.

Hi Friends : I would like to invite you to my post, title GTronic, on 4Aug13(pg7 as at now, Question: how to seach for an old topic ?). I would like to hear your comments.

Tan KW : in my opinion, GTronic is a 莺莺美黛子 in a smaller scale. I need longer time to validate.
LPI is my portfolio is a real 莺莺美黛子, which I even do not check for its closing price most of time when i browse for mkt update.

Please drop comments.
Thks.

大佬：I am really a non financial guy. Frankly speaking, I hv this stock in my database since months ago, but it is not in an active list. I have a reason to keep it in cold storage. Then how, do u want me to throw spanner into KC's each recommendation and become a two faces bad guy who pours cold water while on the other hand benefiting from his hard work? This time I choose to be silence. Thks

Tan KW :
Cold Eye said having a close follow up on 5 stars counters and do not buy “NON-美黛子”.
Your quote to KC : “but i think kcchongnz should able to follow up his stock closely –“. You gave him an false impression that even though it is not a 美黛子, as long as follow up closely, it will be OK.
Sorry, if I read you wrong. Thks

Hi Tan KW and KC :
After the recommendation by KC, I went to Bursa for Annual Report and read thru the introduction of the company and profile of its directors. Once I finished the profile of Directors, I decided to delete Fibon from my database. I am a non-financial guy and I do not feel comfortable with the BOD. Please have a read, I believe people as smart as you must able to find out more than me. Even though if I were WRONG, I still can find many more visible and convinced 美黛子in the market during the “Christmas Sale(Cold Eye again)”, as long as you are patient. I do not want to take unnecessary risk for betting in an uncertain duckling to become a white swan especially at the current historical high market.
The second message I got after reading the annual report: Put it in another way, if you are not buying its shares thru KLSE but were exclusively invited by Pang family to have a joint venture in Fibon for 3 years with option to extend. Assuming the required capital is only RM50K with option to increase. Do you, says staying in KL, want to put your hard earned money into it, which is far located in Kluang, Johore ? Frankly speaking I will definitely NO.
KC and Tan KW: I would like to reiterate, you did a great homework. As I read and benefited from your hard work, I feel I am obliged to let you know my view which may help.
Thank you.

Tan KW: Aiyoo, a bit confusing to me, so do u encourage KC to buy Fibon? I do not view Fibon as “莺莺美黛子" at all. And I am trying to put some brake into his hot venture into Fibon. Hopefully, he has the same view as mine. But for sure he still can view thing from another angle. This

To non-Hokkien, "美" means no.

KC: If I understand the teaching of Cold Eye correctly, Fibon is not “莺莺美黛子” at the moment. KW Tan: what is your thought ?

Side topic: to me, another implication of “莺莺美黛子” is the father of his classmate at night school who enlightened him into investment. Do you agree?

Cold Eye complained that a lot of followers agreed w him n were motivated after the talk or article. But after awhile, will back to old habit. Then when got burned, come back to cold eye again. So friends, do we really practice consistently what we learnt from Cold Eye. Good luck.

Hi KC:
You did a great job and you are much better than many people particularly myself as you perform Financial Analysis before investing. I am an very ordinary investor trying to understand a company from as many angles as I can but I miss (because I unable) the most important piece which is reading the financial report, not to mention financial analysis. So you are much ahead. Salute you.
Thank you very much for your generous sharing

To followers of FongSiLing, I would invite you to read again 分享集:为无为则无不治 26Jun2010 -“莺莺美黛子” especially at the current moment where KLCI is hovering at its historical high.
A very good luck to all friends

Hi KC : I have few concerns, just to write one below…
A business is managed by people thus the most important criteria for its success is relied on its management. After reading its Profile of Directors from the Annual Report, I deleted this counter from my database.
Between KFima and Fibon, I voted for your KFima.

Thank you and Good Luck.

Hi Tan KW :
Buying Hai-O is a case study only with hidden advice inside. I worry it may create resentment if I write out directly.

I have a long story on Zhulian and Hai-O but I do not have any plan and study on both lately. Just following up the businesses and keeping the lovely Zhulian for my lovely daughter.

Good night.

@yungshen1 :
I strongly agree with Tan KW on the above 2 comments.

I opine KFima and Hai-O by KC will perform equally well as KNM if not better.

Please think twice before putting in your hard earned money into KLSE. The final choice is still in your hands. A Very Good Luck to you.

A Case Study: Apprentice does not view Hai-O as a good counter. I disagree with him and stubbornly buy Hai-O at 2.72 tomorrow. When I make a fabulous return, I will not laugh at Apprentice but instead will thank him for spending time and afford to trigger me to think more.

Hi Yungshen1
1) Low price comes with a reason. Sometime we just do not know what it is. The market is so smart, we are( at least I am) just ordinary people, it is risky to think that we can scout a superb counter but the thousand of experts out there do not.

2) I follow almost all of Cold Eye’s articles which are available on-line, newspaper and the two books, I believe that he has never recommended KNM. I do not know much about KNM now, but I lost big on this counter many years ago. One of the reasons was the “not so reliable management”. This is the most critical criteria according to Cold Eye(the 1st Star). So my humble advice is not to touch this counter. If the price is really up, do not feel sad, let others to earn this kind of money but not us who are followers of Cold Eye. We can earn from Right Path=正道.

Good luck and sorry for not supporting your view.

Iafx : thank you. Lesson was learned but there are gambling bugs flowing in my blood, thus till today I do not make a good return from KLSE. Nevertheless I have a dream to make a good return one final day. 人生有梦才伟大. Life is interesting only with dream. Bye.

For sure, besides the (star 1) visible profit growth prospect, the (star 2) dividend yield is great too. My cost is 1.84, div for this yr is 0.13, yield=7%, much higher than FD. Even at the current 2.70, the yield is still 4.8%. One unprofessional and shallow thought which I have is that the owners are old thus they will continue high DPO so that they can get the money back. But as they are (star 3) good and reliable owners (to me), the high DPO is not jeopardizing the business which is attested by the (star 4) extra cash and sufficient re-investment in company. The products are highly demand by (star 5) new electronic gadget(tablets, smart phone) and I foresee the demand will keep on (star 6) growing.
On the other hand, I will not buy more at the current price as to me it is now traded at the price of Dec 2013. Why ? EPS for the 1st half is 8.86sens. I assume the best eps for the second half at 12 sens. The eps for FY13 is 21 sens. And I accord a good PE at 12, the TP should be RM2.52 at end of 2013. If the annual growing rate is 20%, TP at end of FY14 and FY15 are RM3.02 and RM3.62 respectively.
Thank you

Hi Faberlicious :
Do not feel sad as at that time, there was no catalyst for the company business. If I were you, I would switch to others too. The company was only doing good lately after the return on its R&D initiative kicking in.

When Cold Eye recommended this stock in Jan 2013 at RM1.70 (excluding div), I were convinced but has no bullet to buy. I recommended a good friend to buy during CNY gathering. In Mar 13, when I have some free fund, I bought some. After PIE’s dividend ex on 27 Mar13, I switched all my holding on PIE into GTronic. I made a very handsome return and I regretted that I did not more fund to buy. My cost was at RM1.84. I will not sell no matter up or down till 2016 as I buy the dream of its exe president to bring the company to RM1 bil mkt cap i.e RM3.70 per share.

Thank you

Hi KC and Apprentice :
We are investing with hard earned money. If one has doubt on Hai-O’s recruitment scheme, do not invest. Fong SiLing and Warren Buffett said that we should not invest if you do not understand the company.

My view : Haio recruitment scheme was skewed to membership fee before the revamp by government sometime in 2010/11 . I believe now it has changed and the uptrend in earning from MLM was achieved by healthy scheme, abiding the government new ruling. One very good point by Apprentice was that BNM ruling on personal loan which I believe somehow will slow down Hai-O’s MLM activities among civil servants.

Anyway, as I have doubt, I will not invest into. Even if I have no doubt, I will not invest into Hai-O at the current historical high on KLCI. I can wait, if I miss the boat, there are plenty of other boats coming.

By the way I very Respect and Appreciate sharing from KC and also the different view from Apprentice.
Thank you

KC : Thank you.

Honestly, I still have some penny stocks in jail for few years already, i.e. Notion and Masteel-W. Waiting for opportunity to rescue them. Ha, ha. Shame to me.

Hi iafx : You are right, not all penny stocks are bad. Big stocks grow from penny too. My favorite Zhulian was small when it was listed few yrs back and till today it is not big too. My point is that a lot of ordinary investors have no good access to information or even do not know how to find and read information. It is better for them to play safe on big counters with less fabulous return and less risk rather than wonderful return but big risk. I do not believe Warren Buffet invests in penny stocks, may be I am wrong. My believe is that when ordinary investors punted the right penny stock once, the return is huge and addictive which will potentially seduce them into a no return route – gambling. Just my 2 cents opinion. Thank you.

Hi faberlicious :
Thanks for giving me an opportunity to communicate with the same fan of Zhulian. I am a fan on GTronic as well, how about you ? Regards

Hi KC : to me, a non financial guy, you are very professional as you know how to use financial analysis tools and very kind and generous to share your homework. THANK YOU. I am following your posting and tracking your recommendation.
I like KFima as you and have accumulated since early 2011. My cost is low and thus yield is high and I will keep it for longer term. However I do not buy more as I have concern on its relatively small market cap and the pure color in Board of Directors. To me, a competitive company should be meritocracy oriented which should “generally” not a single color in BOD.
Thanks

Hi Apprentice :
In my 20 yrs experience in KLSE, I made very good return on div counters such as Zhulian, MBB, LPI, CIMB, Tanjung to name a few but losing all earning while punting penny stocks occasionally such as Scomi, Latexx, Olympia, AKN, Matseel. So I strongly disagree for ordinary investors to punt on any penny stock. Thing will become worst if they made some profit in their early punting which will push them to gambling rather than investing. Once tasting blood, it is very difficult to withdraw yourself and end out paying with blood. I would like to quote a line from an article from i3investor which I read yesterday “第四步，百万富翁并不是因为投资高风险的股票而致富的，他们大多数只投资一般的绩优股，慢，但是低风险地敛财。” Hopefully you can read Mandarin.
Thanks.

Hi :
Among MLM i.e. Amway, HaiO and Zhulian, I like Zhulian the most for
i) highest div yield
ii) highest PAT
iii) highest net margin
iv) highest growing profit contribution from oversea ventures seeing the limited if not saturated domestic market
v) bigger market cap which is approaching the US$1bn market cap factor(in this perspective Amway is better)
vi) higher and more consistent growing rate in net profit
vii) self mfg products with no risk on discontinuation on exclusivity
viii) My Sifu, Mr. Fong SiLing is one of the major shareholder(his name is no longer appeared in Annual Report 2012, he may have sold some and converted to GTronic)

I started to accumulate the 1st batch of Zhulian in celebration for the birth of my daughter in 2008 at RM0.91 which is now almost zero cost after ~RM0.70 div so far and 1: 3 bonus in 2010.

Including those accumulated at higher cost after 2008, my current average cost is RM1.1 excluding the received div each year. So the div yield is about 0.155/1.1=14%. My point is buying a good high yield counter and keep for long term, we can achieve financial freedom. By the way, Zhulian has been locked for the education fund for my daughter who is at 5 now.
Thks

Hi Apprentice :
1) I like your comments and thank you for your contribution to investing community.
2) “Quote from SinChew, 2012-07-17 19:09, 大馬研究披露，馬銀行曾經暗示，一旦全面採取108條文，派息率將從75至80%大幅降至40至60%。”
I cannot find an official announcement thus far from MBB on formal Policy on DPO. So I assume it varies depending on macro and micro environment.
3) I agreed with your view that services from MBB are good but is still far away from PBB and behind CIMB. If the mktg is a real fare and equal, it has no way to complete with PBB.
4) In my view, CIMB is more efficient than MBB judging from its products, e-banking, counter services and also the name of non-pure “Ali” in the senior management team i.e relatively more meritocracy. I started to keep CIMB beginning in 2009 till today with ave cost RM6.1. It has been allocated to my third son’s education fund who is at 7 now.
5) I also agreed that MBB is a counter can be kept for very long term. I always asked my conservative friends to invest in MBB(~RM8 at that time, 2010-2011) via a small story: “ Hi buddies, there is a corner shop office for sale at RM800K. MBB wants to have a long term lease on that shop with 6-8% annum rental. Do you interested to buy? The immediate response was “YES” and would commit a loan to buy the shop. Then I asked them just go to KLSE buying MBB at ~RM8(at that time). And now the one who believed my story always called me expressing his appreciation.”
Thanks