The insanity of share markets.. in 30 minutes.

For those still holding, due to notion's big hedging position, their forex hedge itself, can be considered as a separate business unit. All in can consider notion's business to

HDD, Camera, Auto, Forex, Silver.

At the moment, Forex and Silver is heading the right way... but it's a very volatile thing, which may or may not last.

Gold price will normally trend against the USD... weak USD, higher gold price... Notion's forex performance and silver performance will rise and fall together. USD to RM exchange need to drop to 3.23 for some forex gain on next Q, and at that rate, silver maybe will hit 23-24 usd. Because of weak sales in camera, forex n silver will play a bigger role now.

Notion's 2/5 eggs is in the same basket, and both of which cant be controlled by anyone.. Mmmmm. Our fate as shareholders(short term) lies in the wind :/

I believe their next Q's profitability will depends a lot in this aspect.... very risky to say the least. USD to RM 3.23 and below, will have forex gain, and gain from associate (silver)

Stupid or not for still keeping, well, what's your reasons for buying it in the first place? Are those reasons still valid? My reasons
EPS, NAPS, and Good Management team.. (well, based on how they grew their company up from back then.. you have to give them credit)

So, EPS is down right now... is it a permanent thing? If yes, sell.
NAPS. Still good.
Management team... Disagree with their huge positions on forex hedges, to me forex is a gamble, you win some (When USD > RM is below 3.21), but you'll lose back eventually (Now), why hedge in the first place then?

Neutral on their silver investment, overpaid yes we all know that, but hey silver is still rallying, at the moment.

Mmm... stuck between a rock and a hard place, selling it at too low a price, and u'll just realized your losses.
Look at JCY last few months ago, ppl were screaming sell sell sell, research house TP 40 cents... to those who sold at 5x, they'll curse now.

This is just for current stock holders... and my own thoughts as holder too :(

If nothing else and notion just break even this year, notion's still well supported by their net asset per share of RM 1.1x. If you have another stock selection or better choice in this 3-6 months, by all means, sell. (but ur new stock will have the same risks too, no guarentee it'll fly)

Analyzing notion losses,
Operation loss, 3.8 mil (Will recur again if same revenue figures next Q)
Derivative loss/Forex 3.3 mil (If USD to RM is worst than 3.28 will incur more losses, of course if lower than that amount, will get some forex gains)
Finance cost 1.2 mil ( Will happen again )
Loss from associate 1.1 mil ( At current silver price, and if alcyone's turn around is successful/or as they planned, this should be a net gain next q)

Projected next Q results, worst case scenario
Same operation loss 3.8mil
Forex loss, could be higher, as it went to 3.33 in this q, but it's back to 3.29 at this point. 4.5mil
Finance cost 1.2 mil
Gain from associate 0.1 mil or put it as zero. At current silver price, if can maintain til end march, alcyone should finally breakeven or small profit due to capex still ongoing.

Insurance claim coming in?? Finally? 2 mil? Very pessimistic figures, I put.

Net loss next Q, 7 mil + tax, 7.5mil?
If worst than this... then something else is going on there, and really need to revise my outlook on it.

There's the land sale and leaseback going on, for a potential one off 60mil gain, but dont think it'll be completed by end of March to reflect in next Q?

at least, they are taking steps... whether right or wrong, or how fast can TRW account grow/silver up... nobody knows yet. Definitely not good for short term traders looking to make a quick buck. Guess they'll be cutting loss in the next few months of trading session.

I take a longer view on my investments.

Calvin, well no need to be sorry about it.. cant avoid it if there's a fundamental shifts happening. A good business will have to adapt to changes that surely will happen.

I'd expected the new customer to cushion the drop in SLR abit, and for the SLR to have a gradual 10-20% drop over the coming quarters, seems like nikon and canon wants to clear out old inventory asap and replace with brand new models.

Well it's definitely clear now that notion have the excess capacity, can they get more new customers in to diversify themselves now? TRW a good step, but volume unfortunately too low... just a net increase of abt 2.5 mil contributed by TRW per Q currently..

surprising big drop in camera sales! not good. need to review my position on it d.

Im just talking fundamentals here...

JCY 4 straight quarters of losses. -3.04 EPS
NAPS of 0.53 cents.
Dividend both 1 cent

Notion
4Q EPS of 8.13 cents
NAPS of 1.19
Dividend both 1 cent

Again, as I have said, I'm really interested to see how JCY justify its current valuations, and if it's really based on fundamentals, then I'm pretty sure notion will gain accordingly too.

Ok, i'll spend more time on this as I want to know if there's any direct correlation between JCY n Notion(HDD) sales too
JCY's sales for the pass 4 Q

376824 > 401424 > 401690 > 414354

In terms of QoQ % changes that'll be
6.52% gain (401424/376824), no change (401690/401424), 3.15% gain (414354/401690)

Notion's past 4 Q sales for HDD only (but not sure how much the fire case will have impacted the figures.. just go ahead anyway)
17 > 19.9 > 20.9 > 21.2

17% gain (19.9/17 this QoQ result may not be acccurate due to notion fire in 1st q) > 5% > 1.4%

JCY QoQ % wise.
6.52 > 0% > 3.15%

Notion QoQ %
17% > 5% > 1.4%

Ok, figure is interesting I have to say, no direct correlation.
Let's see how it goes then...

Sage, anyway, to keep things short, fundamentally QoQ things is looking better in 3/4 of notion's business.

HDD (ASSUMING JCY's rise is based on fundamentals, and not just hyped up mindless goreng going on) your thoughts on JCY vs Notion is flawed, they're in the same boat, but different size. Any X% increase to jcy will be the same X% increase to notion's hdd division, more or less. I'd really like to c JCY's Q result... to me, jcy's rise is not entirely supported by fundamentals and is more of goreng thing, but again as notion holder of course I hope I'm wrong.

SLR, flat or slight down.

Automotive, we already saw a nett 1mil increase at the time they announced TRW as a new customer, but since when did trw joined? There's still potential for another 1 mil increase in sales, from trw alone.

Silver, on surface not so rosy, agreed. But you'll need to dig deeper, there's already a ~350% increase in nett silver production QoQ, this is despite most of the turnaround plan only being active for maybe less than 1 full month, and also with the mine shutdown previously. There's also another aspect to it, which is alcyone's expansion programs. Although dormant now, those expansion will be a jackpot if silver continue on its current trend. If it hits 25. Silver is bad to notion if < 20, neutral if ard 20-22, good if 23+, jackpot at 30. A bit risky move.. but who knows where silver will go.

also, check out silver's chart lately... been holding strong and climbing.

Anyone noticed JCY's rise? Pretty strange for it to rise while it's been loss making all along, if the rise is supported by fundamentals, notion's HDD dept will be boosted too.. Think some are beginning to notice notion now.. picking up it seems

Gonna be a tough Q result I think.
A lot will depend on them getting a new customer in.
Forex is not helping too.
Silver/gold is surprisingly strong. Just will not break down to 18 even after 2 rounds of taper

Uhm... why would reject in AGM? normally it's almost always approved, buy back is a good thing.... but approving it, doesn't mean that the buyback will proceed. If they buy back, it'll provide support to the price.

I dunno why you have such a different view/thinking on this.. why u believe will reject in AGM? Have you seen any share buy backs rejected in AGM? It's really 99.999% always approved.

hi... wrong info, it's just a notice for share buyback authority to be renewed in the coming agm, as the previous authority expires soon.

The market transaction, volumes of each transactions.. can we get any info from there that may indicate such activities is happening?

For example, sometimes the transaction looks too much of a coincidence, a big buy Q comes up, and met immediately by a big sell Q and vice versa. It's not that the big Q stays open and is bought by in small chunks over an extended period of time.

nobody can predict the market, hope no one sold at the bottom.

Anyway, there's another point that I'd like to discuss... in regards to the directors selling their shares.

On the face of it, yes they did sold their shares, but behind the scene, how can we be sure that the shares are not sold to related parties and that in fact, their shares only went from right hand to left hand, and in the process maybe even accumulating more, when the small investors sold their holdings?

I'm more interested to see how much revenue their new customers can bring in per quarter basis. An additional 3-4 million per Q from TRW and another 3 million from a new customer's gonna be good.

Telecaster, a mine's cost of operations is fixed. lets say, i have a mine with 1 miner, and me as director, total cost of operations will be RM3k for my guy, and RM10k for me, add in mining equipment rental or electricity, or cost of land rental/purchase from government. All of them are fixed costs right? Total cost of operation per month, lets say 20k. Per year my cost is 240k RM.

If i produce 1 ounce of silver, my cost of producing that 1 oz = 240k
But with same cost, if i can produce 100oz = 240k/100 = 2.4k
Similarly, if I can produce 100000 oz per year with the same amt of staffs, my cost per oz is RM2.4

What alcyone have identified is they have a bottle neck in the crushing part, and cost cutting in other areas. With a bit more investment, and cutting fixed costs, they can roughly double their OZ per year. while lowering cost, since their fixed cost is about 19million per year, if they can get 1.28mil oz and if can sell above 19AUD per oz, they'll break even and profit..

cutting lost = your lost, somebody else gains. Keep it low and i'll buy more with my year end bonus next month :P

Alcyone is providing frequent updates... seems on track.
http://www.asx.com.au/asxpdf/20131126/pdf/42l4gx2z318cx0.pdf

For me, the previous losses for alcyone/macmin, is caused by bad management during *good times* where prices is at USD 30++ per oz, I think the previous management got it over their heads, and thus ran into losses.

Anyway, this is what alcyone management is aiming at currently.
http://www.alcyone.com.au/images/alcyone---ciajeiseph.pdf

Based on this, their total costs is around 27 million per annum. Most of which are fixed costs, employee costs, director fees etc and should be fairly predictable.. This cost will mostly +-3% at most, and should not deviate much. The only variable that alcyone management can change is to increase production, which is what they're trying to do now, and their profitability will directly tie to them hitting the 1.28mill oz per annum. Again, this part should be achievable too, as their mining is not an issue, just crushing seems to be their bottleneck..

Their targeted production cost will be AUD18.98 per oz (once they hit 1.28mil economic of scale), in my own expectation for it, i actually assumed their cost to be AUD20 to give me more leverage by assuming a worst scenario.

As long as silver price is above aud20 (Currently AUD 22) that's a company making 10% margin on their products, which is good enough I guess.
Also, if they really can keep costs to aud19 as they targetted, their margin will be 15% at current silver prices of aud22/usd20.2

Assuming a really low silver price of usd18(aud19) alcyone should still breakeven.. so I think not much problem with that investment in the long run.. + as investors, I think we all have considered diversifying into gold/silver one point or another, so we shld be able to understand the reason behind it too... too optimistic maybe, but minimal risks. And there's always the bonus if silver hits 25usd per oz :P

Have to wait for the next Q results to be certain where it'll goes next. My price, 75.5 and 23.3(WB) respectively.

Just browse TRW's website, they have so many products, plenty of opportunity for Notion (IF they manage this account well)

http://www.trw.com/

Assuming all things are equal, and last Q notion's machine usage is abt 75% if TRW can just push this usage up to 80-85% figure, then the margin will be very healthy... Based on prior revenue of 21 million, and the increase in automative revenue of 1million in this quarter 1/21 = approximately 4% increase in sales already, won't surprise me if machine utilization picks up to 80-85% in next Q's results, resulting in much healthier margins... that's just assuming TRW contributing 1 million additional sales per Q...

Sephiroth, dont just look into that, there's some good news. Cost of sales dropped 2 million, seems like their automation is bearing fruit, if exclude the forex related costs, their EPS shld be abt 2 cents.

New business from TRW is promising, TRW is a $USD 4 billion sales per Q company. http://trw.mediaroom.com/index.php?s=32950&item=128118

From this Q results, it only mentions TRW just joined as their customer, we don't know since when, 1, 2 or full quarter? And already there's an increase of abt 1 million to the automotive business. If notion manage this account well, and can get more parts from TRW's USD 4 billion, that's not too bad at all.

Please feel free to share more informative discussions here, I'd like to see others ppl views too, to balance out my own, probably biased views.

MPI's results greatly uplifted the entire tech sector.... if can add in a good Q result from notion next week, gonna be good for the share price

Tech sector waking up

Tech sector is waking up...

Thanks Chong for sharing on your works, appreciate it.
EPS will probably be around 2.5 cents, and if the business loss insurance is received in this Q, maybe 4 cents EPS in total. FY EPS of abt 11.5 cents potentially.

Moving on, silver investment, is a 40%60% thing... I agree with the move, but maybe they overpaid for the price. It's more like a calculated risk I guess, odds of silver price falling to 18-20 is not too likely, vs odd of it above 22-24. With possible chance of if it shoots above 24 usd per ounce, that's the added bonus there. However, there's something of concern too, notion director mentioned that they can sell silver to local jewellers at spot+30% which is incorrect, pamp silver bullion can be easily bought at spot+8% by us on a walk in basis... so I doubt the 30% margin is an accurate reflection.

Good thing is, notion is downplaying alcyone's silver supply, by saying 3 years, when alcyone's ASX/FY announcement says their supply is more likely 8 years mine life, longer mine life, avg selling price of silver should be better.

Still, too far to know how it'll go, we'll only see the actual progress from alcyone on Jan. When the proposed alcyone upgrades are complete, and wait until alcyone's March's Q earnings to see if Alcyone management are really in control, and can deliver on their promise.

In regards to their diversification, they did it well enough venturing into camera sector, will they be able to repeat the same again?

Well, good news is, at least the director is buying 300k of shares at 62.5, so it should be a good buy below this price, for safety margin, i'll buy it if its dropped 10% from 62.5 or maybe he knows something good will happen soon? nothing speaks louder than dropping 600k into shares, dont think he intend to burn himself

also, you shouldn't refer to the skyrocket price during the thailand flood, it's a one off event, which most probably wont happen again soon.

Erina, you need to look into their actual business... WD n Seagate dont only supply desktops/laptop type of harddisk which is declining, their enterprise and 5mm harddisk sales is doing good too and with much higher margin. The only problem is, is JCY and Notion(which i'm invested in) manufacturing the profitable type of disk, and at what costs? Also, of course, min wage policy hits both company too.

Not comfortable to jump back in after such hike d... aih, choices choices.

good TP for all of you still holding!~ i shld learn to have more holding power.. hehehe! :(

Got caught out already, see if i can get back in ard 46 or 45... Anyone want to share what's ur typical gain% that you aim for? For me, can say my avg price abt 35 cents for the WA. exited ard 46.5 yesterday, was hoping to get it back lower.. seems like i'm off that boat d now. I used to be a 10% guy.. haha always selling at 10% now starting to stretch and hold it for above 20% gains at least b4 sell.. but come to think of it, engtex is worth to hold longer term for longer gains geh i think.. mmmm.

Interesting article indeed, the problem is how much Notion can transfer or upgrade itself towards the manufacturing of the above, eventhough consumer hdd sales may be bad, but enterprise hdd sales is good and projected to get higher and with higher margins too at least for WD/SGT. There is an opportunity there, but it'll depend on notion's management execution to successfully migrate more % of their HDD to the enterprise or the ultra slim factors.

US stocks, not too positive on them, seems like their P/E ratio for most of the S&P/Dow is too high? Future earnings already priced in... long term, I dont fancy US economics much.. too much borrowings already. Msia's heading the same way too. Short term, QE will provide fast n easy money to keep push the stocks though...

Is there a PM function here? StockCrazy, anything on your to watch list right now?

Not a good sell :(

running too fast, exited at 465, not too sure wanna go back in or not :/ the rest of the water stocks seems pretty quiet though

Everyone else is rolling, when eng tex turn? Puncak, JAKS... :D

Water play is back, http://klse.i3investor.com/servlets/ptres/18756.jsp kenanga upgraded water stocks

seems to have bottomed? good support

Don't want to post in the scable tread, later spoil their party, as plenty ppl excited abt it there... scable trade receivables abt 80mil, their 3months sales is 47mil, means bad collection as their AR is close to 6 months old. Only good thing abt it is the news that they have ~650mil of sales coming in soon... in terms of cash balance vs debt.. not too good too. will they need to borrow to get materials for this 650mil of sales?

Woops, my bad, EPS ~ 4.33 cents for 2012. previously they had a good year with 11 cents EPS at 2011.

stockcrazy, mind to share abt scable that interest you?

just had a quick look, NAPS ~0.98, EPS 2.12 cents last year. Mmmm.... normally based on this two, i'll skip the share d. Compared with Engtex, with clearly superior EPS, and NAPS. Eventhough the technical chart seems good, and the director did buy shares at 1.49-1.53?

scable, interesting chart... i'll have a look.. hehe playing ard with my nick for a while. their P/E good? normally i only buy the ones with good P/E.. im usually a fundamental guy, with 3-6 months time frame per investment.

Puncak's dropping steeply too, seems all water play big sharks is taking profit.

*Edit, 46.5 not 46* actually besides sharing the good part, here's the not so good part, half my q at 46.5 were matched before i can cancel the remainder..