MIDF Research report on EAH Holdings Berhad - Explosive growth

Salient points mentioned in research - Forbes Asia's 200 Best Under A Billion 2011 and 2012, undervalue market capitalisation, sustainable growth as Company has strong GLC clients base, solid order book of RM103.6m.

TARGET PRICE - 26c

See original MIDF report or coverage in sinchew.com.my

I heard from my contacts in the banking sector that Instacom has been talking to various banks to raise up to RM1 billion in credit lines to fund new projects. Whether its true or not only time will tell in the next several months.
The point is all about potential, Like Twitter for instance, no profits yet but IPO price almost doubled. Question is has Instacom got potential.
Is it in the right sector to grow.
Also my earlier point on Instacom's solid fundamentals, brilliant IR, aggressive momentum trading with high trade velocity and good follow through buying support all augur well for a stock that is highly liquid and well absorbed by the public based on public available information. Definitely not "Pump & Dump" manipulation by syndicates.
This means whether win or lose money all depend on your timing and trading ability n holding power. Buy low sell high,or buy high if can hold sell higher. If market buoyant, win or lose in this counter only from 2c to 10c. Unlike those stupid syndicate plays pump up to a few dollars, can lose an arm and a leg one. Or get to hold forever at super high prices with no recovery in sight.
So guys happy and shrewd trading. Get in at the right time can make a few rounds, lol.

Also the major key element is Instacom has been in trading spotlight since May till now, a solid 5 months period. Consistently in Top 10 or Top 20 or Top 30, and not once even out of Top 50.
If syndicates play, game over and dump all probably in June leaw.
I would say Instacom has done a great Investors Relations(IR) job and their fundamentals pretty solid as they are in an industry of great importance in any country. ie the Telecommunications sector, and Instacom lucky in East Malaysia as there is where the growth will be centered for telcos.
Plus their management must be pretty competent, otherwise their IR strategy will be half past six as most Ace companies are. If mgt weak and fundamentals not promising, RHB would not have covered them and put a TP of 51c.

Guys,the key is to look at the directors' selling pattern and ask. Are they pumping up the price and dumping - "Pump & Dump" or "Hit & Run" strategy usually adopted by syndicates and play the counter very short term only.
I dont see directors pumping & dumping their shares and running. Instacom moves upward due to strong momentum trading and high trade velocity with excellent follow-through buying, and all because the investing public somehow see value in Instacom for the long term and all come in at various times. Rightly or wrongly only time will tell.
But this is definitely not due to mkt manipulation as in syndicate plays such as Harvest recently or Iris, years back by Repco.
Directors are like us, shareholders also mah, they have every right to sell. So long as they sell progressively and gradually into the market and not cause a price collapse as in a "Pump & Dump or Hit & Run" sting job, we should not worry unduly.
Example - Ngu sold warrants in Sept progressively at av 10c. Now 17c. If he didnt sell at 10c would we have profitted now at 17c. Read my Aug posts when I predicted warrants shd trade in the range of 16c and 22c.
So guys happy trading.

The exercise price for Instacom has been fixed at 33c and will remain at that price for the next 5 years.

Only the share price will be adjusted depending on its closing price on 27th Aug. Assuming the share price closes at 46c on the 27th Aug, on 28 Aug entitlement date, the price will be adjusted to 42c based on my calculations.

That means the share price will ex and open at 42c on 28 Aug, whilst the exercise price will still be 33c, which is superb value with a 9c or 21.4% discount from 42c.

I believe the warrants will trade at between 16c to 22c,depending on market sentiment. I put the warrant to be worth 14c conservatively (usually its at one third of the mother share value, say 42c after ex), meaning per share its worth 7c since for every two shares you get one free warrant. Assuming the share price trades between 35c and 46c after entitlement date, that means the share will be worth between 42c and 53c if you add 7c per share arising from the warrant worth 14c.

So guys/gals, do your own computations and make your decision accordingly. May you all profit wisely and sleep well, lol.

Sorry I do not have the link, Business Today is a monthly magazine. You can buy the July issue from your nearest newstand.

However, I do remember Dali blogging about Instacom when the company was initially listed via a RTO of IPower, calling it ACE New Darling stock, and putting a price range of between 48c and 58c.

Maybe Dali's call has been belatedly vindicated. I also managed to get a copy of the RHB Research SCC book, out of 30 of the small cap companies indentified by RHB, Instacom was the only ACE company selected.

Also in the book, Instacom ranked well in 4 out 6 categories, namely :-
• Ranking based on Forward FY13 PER (x) – Instacom ranked #8
• Ranking based on Forward FY13 P/BV (x) – Instacom ranked #9
• Ranking- Highest 3-Year CAGR (FY09-FY13) (%) – Instacom ranked #1
• Ranking based on Lowest PEG (x) – Instacom ranked #1

Instacom certainly has solid fundamentals.

Business Today July 2013, Volume 13 Issue 07, cover story reported that potentially Instacom's share price going forward should hover around the RM0.62c - RM0.70 band.

RHB Research's target price of 46c is conservative relatively speaking. As with most research houses, they rather errs on the side of caution than optimisim lest it hits 46c, they can revise their next buy call upwards. But if it doesnt hit 62c or 70c, they still come out smelling like roses.

My say - the stock should shoot past 48c, and trade around the 50c to 55c band.