haha, i try to get more information by searching around the forums. The more the better

Hi Fortunebull777, thank you for your reply. What about facebook groups?

Hi , I am not sure if it is allowed to open this topic at here.

If it is not allowed, please delete my thread.

Can I check with you guys what investment portal do you all use apart from klse.i3?
Do you have alternative forum? I know i3 is the most famous one.

Hi， I think they are different books. It is good that you have shared investment books. Do you have a list of recommended books for investors to read? Thank you

Hi Ricky, are 100 baggers and 100 to 1 in the Stock Market the same book?

kcchong, is there a website that enable me to find the information on corporate exercise of a stock easily? warrant , iculs, rights, bonus and etc.

hi it is me again. any good investment books to introduce?

Hi Kcchong

Peter Lynch also emphasized that keep your winner stocks in the portfolio, no point to sell a good stock after it has shot up tremendously.
My question is, as an investor, will you fall into "endowment effect" if you hold only winner stocks?
My next question is, will you buy a good quality stock that you had never owned after the stock has shot up tremendously but appears overvalued?

Hi Kcchong
May I know how you evaluate gadang?
Which valuation model did you use. Income(dcf,ddm), comparables(ev/ebit,p/e,p/cf, etc?) or liquidation (graham net net,nav)
2: What do you think about its quality of earnings ? ROE, ROIC and etc?

hi kcchong how do you determine the growth rate for this company ? thank you

Hi Kcchong

Reinvestment rate=(capex- depreciation+ change in working cap)/ebit(1-t)

What if it is a mature company? the depreciation >(capex+change in working cap).

Therefore, you end up getting -reinvestment rate.How do you adjust the reinvestment rate?or you get negative growth rate?

congratz!

haha. thank you

Expected Growth = Reinvestment Rate * Return on Capital

What if it is an asset light business, and ROC is higher than 100%?
How do you adjust your growth rate?
Capital Invested=PPE+Net working cap

Thank you

How do you calculate Reinvestment ratio(capex)? Growth/ROIC? or you use cash conversion cycle to foreast working cap and use increase in sales to forecast capex?

OK. Thank you for your explanation.
Why you do not use normalized earnings(average revenue) and instead using the latest revenue?

You have mentioned mean reversion which I agree with this concept. Therefore, how do we compute the "suitable growth rate" under this concept?

Missed one method, ROE*Retention ratio= Sustainable Growth rate

Hi Kcchong this is a very well written article. Like it.
When you are doing valuation model like DCF,DDM or Residual income , how do you make the assumptions on the growth rate?
Using the methods like Relative to GDP? Relative to industry growth? Or the company historical growth rate?
If I am not mistaken, you favor historical growht rate over other methods. My next question is, how do you see the company's historical growth rate? Using EPS,Net Income, FCF, Revenue, or other methods?

thank you for your kind explanation. Do you have any more investment books to introduce?

Hi Kcchong

Why one of your criteria is ROIC>12%?
Why not 10% or 14%?
Thank you

Hi, Kcchong, May I know your philosophy? How do you react over the current situation? Using bottom up? Ignore market noise? Or?

Hi Kcchong,

What is your opinion for the folliwing statements?

1:High returns on existing capital—the capital already
employed in a business—are almost meaningless without an ability
to invest new capital at above-average returns. Returns on existing
capital, whether high or low, are already refl ected in a company ’s
operating income. In a static scenario, the driver of return to equity
investors is the earnings yield—or free cash fl ow yield, to be more
precise. If we pay less for a given level of earnings, we will earn
a higher return. Whether the earnings number was achieved by
employing X amount of capital or half of X is irrelevant. In a scenario
without reinvestment, the only other driver of return will be
whether management returns cash to shareholders or whether it
insists on putting cash back into the business despite an absence of
high-return projects

2:This commonsense use of EBITDA appears to have evolved into an
overly broad application of the measure. If we analyze a telecom
services company as a going concern, and the fi rm ’s maintenance
capital expenditures approximate depreciation and amortization,
EBITDA may obscure rather than illuminate owner earnings.

The manual of idea is a great book! Thank you for your recommendation. ANYMORE good books?Hahaha.

Hi Kcchong,

How do you evaluate an IT comapny with high depreciation?

When I evaluate Opensys this company, I realize its ROIC/ROE are very low(about 10%) due to high depreciation. Its FCF/Invested capital is quite high(most of the time the ratio is >20%) because its fcf does not take into consideration depreciation.

when I try to get the intrinsic value of the company using DCF, i realize its value should be very high with conservative growth(1%-5%, I evaluate this comapny when it was 0.2x).

Hi Kcchong,

I have never recommended anyone to buy them, knowing that it is extremely difficult to gauge the short-term movement of share prices. Many of them I do not own any more now, even though they are still way below my intrinsic values computations

What factors that affect you to sell the stocks?
If They are still way below your Intrinsic value, the quality of the business does not deteriorate( i assume), why did you sell the stocks?

Puncak wishes to update the Exchange that as at to date, the Company has neither concluded nor entered into any definitive agreement relating to the above with the Selangor State Government as discussions are still ongoing with the Federal Government and the Selangor State Government on the matter.

http://www.bursamalaysia.com/market/listed-companies/company-announcements/1628781

Puncak has been appointed as the contractor for the project worth 97m in sarawak
http://www.bursamalaysia.com/market/listed-companies/company-announcements/1611809

When is the egm going to take place?
Thanks.

Thank you for your report.

Well, It is very interesting to read your reports.

The first report contains three valuation method- dividend+pe, pe, and dcf(5 years average fcf and golden growth model).
The second report contains one valuation method- dcf(trailing twelve months fcf, damodaran)
The third report( you published it 2 months ago) has one valuation method dcf> 2 years average fcf(golden growth).

You have used different data for the same model(5 years fcf, 12months, 2 years). Haha, valuation is an art, not science.

sorry to hear about that......无端端惹祸上身。

hi kcchong,

Do you have the report that contains "all three methods above give a fair value of Pintaras in excess of RM3.35"

Thank you.

haha. thanks yeah.

Haiyo... we know you are a trustworthy person,I did not think you bluffed when I read the article. I want to get the report to know how you change your intrinsic value. OK?

Posted by kcchongnz > Apr 21, 2014 02:54 AM

thanks for your interest in my valuation report for Pintaras. You are really detailed from all the posts I read by you. Can't bluff you

Haha, you have a sense of humor. I am interested to see how you change your intrinsic value in accordance with the change fundamentl of a company. This is why I want to get the report.

My email: johnwong19xx@gmail.com

Can you evaluate one company? EUPE?

My opinion,

Cons

1:From my perspective, its earning capabilities do not meet my requirement at all. Its ROIC,ROE,FCF for the last 5 years do not meet my requirement .

2:Have not been giving dividends for 10 years.

Pros

1: Expanding footprint in KL. Launching three projects and two of the projects worth 720m that contribute to its bottom line significantly.

2: There might be a sign of a change in divdiend policy (gave dividend in 2013)

3: Graham net net= RM1.28 intrinsic value

Your interpretation of land held for development is correct .

If the land is held for development purposes, its value shall be carried at cost, less than any accumulated impariment losses.

This is persuant to Financial Reporting Standard 201, an accounting standard that also requires that land held for property development be classified as a non current assset, where no developent activities have been carried out or development acitivities are not expected to be completed within the nomral operating cycle.

HiKcchong,

Mind to give me your report? My concluding statement was “all three methods above give a fair value of Pintaras in excess of RM3.35” (or an adjusted price now of RM1.68). That was less than 4 years ago.

I tried to search your posts but could not get it.
Thanks.

The worst scenario is Federal Government invokes Wsia and there is forced takeover(highly unlikely).

What can Puncak GET in this scenario?

按照雪河公司的合約，政府只需要針對已作出的投資退款(water assets)，以及為其所經營的年份給予一個規定的最低投資回酬負起責任(equity-minimum 12% return)。

Yeah. It is good if there is additional compensation in the new ofer. I just dont understand why the federal government wants to gazette/ invoke Wsia if they have already prepared the money(2 billion) for the acquisition.

Puncak Niaga Holdings Bhd will call for an EGM soon to present the Federal Government's proposal and takeover offer of all the water concession companies to the shareholders. ?

Federal Government's proposal?

Is this a new offer?

if the government wants to buyback the assets, the government has to compensate 12% return yoy as stipulated in the agreement. From this point of view, I think Khalid is doing the right thing.

However, he ties the restructuring of the sector to the approal of langat and Selangor ppl suffer from water shortage. He is doing the wrong thing. How can ppl trust PKR in the future since PKR cant even manage a "state"?

http://www.theedgemalaysia.com/business-news/283712-amicable-solution-needed-to-overcome-water-impasse-in-selangor.html

yeah... really dont understand what khalid was talking about? under wasia there was no compensation???

If I am not mistaken today Khalid will reveal the details of restructuring

any news?

Was Khalid an investment banker? Does he understand a simple issue like this?

http://www.theedgemalaysia.com/business-news/283080-forced-takeover-of-water-assets-poses-huge-risks-to-capital-market.html

In 2006, the WSIA was used in restructuring water services in the state of Johor, Penang, Malacca and Negri Sembilan. It has been done before and it has been proven to work so there should be no issue when Selangor wants to implement the same thing as well," he said.

Can anyone tell if the concessionaires were properly compensated by the government when WSIA was invoked in these 4 states?

Isnt MOU irrevocable?
1:Under MOU the fedearl government provides an additional 2 billion for selangor buyout.
2:Why the federal government and state government have different timeline on takeover?

http://www.theedgemalaysia.com/business-news/282414-highlight-sanctity-of-contracts-questioned.html

http://www.theedgemalaysia.com/business-news/282221-selangor-govt-rejects-proposed-timeline-on-water-assets-takeover.html

dont understand. If Federal government is going to gazette wasia, why Puncak appeals on the decision on the revocation of license?

Relax everyone. Langat project must go ahead to resolve water crisis and the developers also need to develop the projects. The State Governmetn also wants to takeover water firms to reduce NRW and make sure water supply is sufficient.. Puncak and Gamuda also want a good exit price. Back to basic and dont get panicked by the stock price easily. Cool down!