Posted by tsurukame > Nov 21, 2013 09:52 AM | Report Abuse

Hi kcchongnz,
A Very Good morning to you and family,
Please advise on your take of intrinsic value of Daiman, Crescendo and KSL properties as these stocks have sizeable land bank in Iskandar region. Over a long term basis ,All these counters will be delivering good profits, EPS and increasing EPS. In the event that land price appreciate further say by 30%, 50%, 70% surge over long term basis , what is your intrinsic valuation of these companies when you sensitize the appreciation of the land prices in these three properties...KSL is a laggard as it has relatively higher debts but KSL city mall is worth a few hundred millions and KSL had ventured into Klang valley properties and there are talks of privatization......both crescendo and Daiman had appreciated in price. Except KSL, Diaman and Crescendo has paid relatively good dividends. Daiman management/owners are rather inactive....maybe they are just too comfortable...lacks drive....Crescendo is really active and are go getters as well as KSL..

Looking forward to your valued feedback on the sensitized intrinsic valuations.

tsurukame, I have looked into those stocks you mentioned here before. Daiman was one of my strong picks as shown in the link below and I have played with all kinds of valuation on it too:

http://klse.i3investor.com/blogs/stock_pick_challenge_2013_2h/35908.jsp

KSL I don't fancy much but I have done some comparisons with others too as below:

http://klse.i3investor.com/blogs/stock_pick_challenge_2013_2h/36493.jsp

Crecendo I like it last time. But never looked at it for some time and not sure if the price worth the value now.

Posted by kcchongnz > Feb 23, 2013 05:03 PM | Report Abuse
ulalar, my opinion on your crescendo as follows:
Investors who have bought Crescendo at about RM1.10 3 years ago would have made a paper gain of 66 sen, or 60%, twice compared to a gain of 30% of the broad KLCI composite index during the same period. The long-term uptrend of its share price is still intact.
The share price of Crescendo started to rise gradually from the beginning of the year 2012 when it was apparent that the company has its financial performance improving. On 31/3/2012, Crescendo reported a huge 35% and 75% jump in revenue and net profit for the financial year ending 31/1/2012 to 290 m and 63.7 m respectively as compared to the previous year. Besides the big jump in sales, its net profit margin also improved drastically from 17% to 21%. These in turn improved the return of equity (ROE) from 7.5% to 12.9%. Thanks to the Southern Corridor in the Iskandar Development, in particular in Crescendo’s good sales in industrial buildings development and its construction activities.
The attractiveness of Crescendo as a long-term investment comes from its fairly low market valuation. With an earnings of 35 sen per share and a share price of RM1.76, Crescendo is trading at a PER of 5. The dividend yield of Crescendo is also very attractive at 8.5% for the last financial year.
Using a variety of discount cash flows methods with the assumption of 5% growth in earnings for the next 5 years and 3% terminal growth rate, and a discount rate of 12%, Crescendo’s intrinsic value is found to be between RM2.30 to RM2.75, with an average of RM2.53. There is a potential 43% upside compared to its share price of RM1.76. The margin of safety of investing in Crescendo is above 30%.
However, the Group's revenue and PBT for the nine months of the financial year ending 31 January 2013 decreased 4% to RM210.6 million and 24% to RM49.2 million respectively. The decreases in revenue and PBT were mainly due to lower sales in industrial properties. Despite of the lower profit, earnings per share is expected to be about 27 sen for the whole year. The prospective PE ratio is still not excessive at 6.5.
The future success of investing in Crescendo will depend on the success of of its Nusa Cemerlang Industrial Park and the other development in the Iskandar Development Corridor of which the government has fully committed on. With RM 444 million worth of land held for development under its balance sheet now, the chance of success for Crescendo appears to be bright.

bsngpg, it is always nice to talk to you.

I think you should by now know very well that I am very poor in guessing stock price in the future. No way.

However I do have a personal opinion about Zhulian, a very good company, one of the best in bursa.

I always say a great company may not be a good investment. That depends on the future of the company, how good it generates cash flows. And one can put this estimated future cash flow into a finance model and see what is it worth at present, and then compared with the market price and see if it is worth holding or not. Mathematics is precise, but assumptions aren't.

I have written three posts about Zhulain here putting forward my opinion on Zhulian and I think my opinion is clearly expressed. Your post also showed that you clearly understand what I feel.

You have to make your won judgement. As I have said, I always get wrong in future share price.

calvin, always nice to read your comments. You talk about PM Corp's business, not like others always shouting about prices, not knowing there is a company behind the stock. Hope you read my post of Pintaras well because though Pintaras share price has gone up a lot, it may not mean it is already overvalued. It may be still way undervalued. Anyway, everybody has his own opinion and I am not saying mine is right and your is wrong. Just a few months ago this guy has been advising people to sell Pintaras at RM2.70 and talked all kind of bad things about Pintaras. He even engaged on personal attacks on me.

You mentioned about MG9231, now I remember he commented long ago in Pintaras' thread. You know we were the two lone rangers there. He is such a nice and humble man.


Posted by iafx > Feb 17, 2013 12:16 PM | Report Abuse

there is no securities house covering this counter - why? no need to reply here, go & do yr homework.

what a joke, tons of books/www/classes/software nowadays on how to read statement, find figure etc etc; what's so aiyaya about being able to read paper? especially copy & bs around it... sigh.

simple, should paper fact is so accurate, why ppl still cannot make enough based on it, why market does not respond accordingly since it is sooooo good as tau-fu claimed it is? in fact, many make loses following these papers, not to mention those who followed bs story.

ptaras solely a family business, no liquidity, core value is never about retail investors, they would rather place $ into private fun(d). mega infra prjs r not forever, after ge13 many will realize "lots of prjs in hand" on the "paper", but only few r running & probably not running at the size stated, not to mention not all running prjs make good $ - what u read is only lum-sum, data in the passed.

ptaras a pick only bcos it is small & relately safe given its cash (also means $ not utilize); maybe could exercise bonus (hopefully not yet another private placement). given its outlook, it is actually too expensive already. given that price, there r a number of other counters worth better than this one. those who grabbed it during the 1.4-1.5 days a bless of god (no need say anything :). those who buy above 2.7 should continue to assess the viability of holding this counter. GCruey could have done a right thing by disposing it now & wait for next opportunity.

god bless u ptaras to issue 1:1 bonus share, good luck all :)

Posted by mikekong55 > Nov 20, 2013 10:03 PM | Report Abuse
kcchong, through your write up in stock challenge; came across this stock PTARAS. I bought 20k of this in early feb/march'13 and intend to sell ex-dividend and ex bonus. am also still holding 2 quality stock in KSENG(20) & PRK CORP(50) bought also feb/march'13.should I hold for another 12 month? your words of advise is greatly appreciated here. thank you and good night.

How I wish I have six sense and able to see the future. However I have no such ability and I don't believe anybody has that ability. I am in fact very poor in guessing the future stock price.

I have no ability to read chart too. In that respect you are miles ahead. However, since you asked me so courteously, I think I should reciprocate that with my opinion, just my personal opinion.

Since you have read my writeup about how good and how good is the business of Pintaras and its performance, net margin>30%, ROE 20%, ROIC 30%, FCF 24% of revenue, 30% of invested capital and all that, you know that it is a good company, don't you?

However a good company is not necessary a good investment, it all depend the price, agreed? Pintaras since you have bought has risen in price for >50%. And that is just a few months ago. Isn't that too expensive now? Before you say yea or no, don't you think one has to have some numbers to justify that?

Based on the last financial report ending 30 June 2013, the PE ratio of Pintaras at RM6.19 now is 9.5. Is that high? What if I tell you it has an excess cash, cash not needed for its operations, of RM2.00? If you ignore this excess cash, what is its adjusted PE ratio right? Pintaras has zero debt too. Plenty of cash, no debt etc and I think a better market valuation would be enterprise value.

The enterprise value of Pintaras is just 6.5 times its ebit, or an earnings yield of 15.3%. Such low PE and EV/Ebit for a company with such high margin, ROE and ROIC, can you find another construction company in Bursa selling that cheap. I doubt so.

Again I don't know the future and my opinion is just mine.

bsngpg, tptan, hiddengem etc are some of the smart investors here.

Stay in your circle of competence, as Buffet said. Even Buffet stays within his circle of competence.

Acknowledging your own limitations, and working working within those limits rather than venturing beyond will give you a great advantage.

As Mark Twain said,"It ain't what you don't know that gets you into trouble. Its what you know for sure that just ain't so".

I am just sharing with you guys the importance of knowing about a business and the measurement about its performance. The financial performance of Hibiscus is deplorable.

I am not here to talk about how much you make or how much you lose in punting. I don't give a damn about it.

I am sure most followers of Hibiscus would appreciate this. If otherwise, I will disappear from here. No problem.

SHL a Graham net net and a hidden gem?

Posted by hiddengem > Nov 19, 2013 08:58 AM | Report Abuse

Good morning Mr kcchongnz, I'm a strong follower, learner & believer in all yr threads that provide a clear direction for me to trade wisely & always making profits.

Can u kindly provide yr input whether SHL is indeed a hidden gem under the Graham Net Net Investment strategy. Yr input feed back is very much appreciated. TQ

After analysis, I find SHL indeed has a lot of quality assets. Its Graham net net is just under RM2.00 which is very close to the net net value of RM2.12.

But maybe you should look at its recent financial performance which is pretty good. ROE appears to be low at only 6% last financial year, but don't forget it has huge amount of cash of more than RM1 a share. Besides it has high quality asset such as land under development, investment properties which are equivalent to cash.

It has very good cash flow too. But the best thing about it is its cheap price. PE may appear to be slightly high at 15. But earnings yield (ebit/EV) wise it is very attractive at 18%, and price-to-book is less than 1.

It has good dividend yield too at 5.7%, much higher than FD rate.

Also don't forget its first quarter results was very good compared to the corresponding quarter last year.

Good financial result? A revenue of 3m but a profit of 12.6m? Gain on dilution of interest in an associate as "profit"?

That is why no short cut. One must know how to read and interpret financial statements.

If you want to know what is a good financial performance for the past 3 months as announced today, look at Prestariang, MFlour, WilloGlen etc. Yes, those are good results from sales and real profit; not some "gain on dilution of interest in an associate".

Hibiscus continues to bleed as shown in the cash flow statements.

See I am right. Knows nothing. Can't compute FCF. Can't use Cold eye's 5 yardsticks. Of course lah, don't even know a thing about financial statement. Cabut already loh!

Never mind. If he does not know, it doesn't mean nobody else knows here. And I can bet with my last $ here also that there are many people here know.

If nobody does the above exercise, i will do it later.

Now I owe a lot of people in i3 who asked me about investment thingy just because wasting time on this fellow. I will try to do them soon too.

So where is your Cold Eye 5 yardsticks to evaluate PM Corp if it is worth investing or not? We are all waiting anxiously.


Don't know where to start, what to see? One head full of dew water ah? I will bet with my last $ it is so.

Posted by iafx > Nov 20, 2013 05:42 PM | Report Abuse

don't write long grandmother story to blur the line, divert the point! since when am talking about asset??? u totally don't understood what ppl r talking and simply attack'n'attack. read back the posts, who is talking what! aiyoyoo... afterall, other cannot use FCF etc to do their calculate ke? must be asset play ke?? u know nothing about what u talk at all, a result of copy too much ke?


I was the one who first talked about Graham net net valuation which us an asset based valuation. You came in and critizised without knowing anything. Then you talk about losses lah, FCF lah macham macham.

You can use FCF to calculate, of course. that is my favorite. So what is the FCF of PM Corp last year ah? Got already or not? Or don't know where to start?

I be with my last dollar is the last one.

Posted by iafx > Nov 20, 2013 05:25 PM | Report Abuse

@tsuru, another gentleman clearly point out the fact, respect!

as for the above auntie, want free lunch? go and sell yr balls... eh, u don't have wor, that's why u copied and modified to cheat in kfima thread.

what is actual profit margin of pmcorp, without the sell of asset? si-tipu-roti-canai!!


First of all, you can't even comprehend what message tsurukame is trying to convey.

Secondly don't talk about who copy and paste and cheated in that Kfima's thread as nobody is interested,as you are wasting other people's time here talking about this. For others who know about this, they have already got the idea what is it about. Ooi Teik Bee's posting this morning already clearly pointed out that.

Thirdly we are not talking about PM Corp profit from ordinary business. You totally don't understand what is asset based valuation. In fact you know nothing about any valuation method. I know you in and out and this i dare to say.

Posted by iafx > Nov 20, 2013 05:15 PM | Report Abuse

see how the mad dog draw other into a fight. fuuyooo, talk a saint, actually a si-tipu-roti-canai!

Take my challenge in some intellectual discussions lah and see who is si-tipu-roti-canai. Very easy to find out one. We are not talking about gun drawing and shoot lah!

Posted by kcchongnz > Nov 20, 2013 05:14 PM | Report Abuse X

I challenge you to use the Cold Eye 5 yardsticks here to determine if PM Corp is worth investing. I bet you can't do it. Come on if you got balls.

I challenge you to use the Cold Eye 5 yardsticks here to determine if PM Corp is worth investing. I bet you can't do it. Come on if you got balls.


Posted by iafx > Nov 20, 2013 05:10 PM | Report Abuse

@house, what is the gross profit margin without the sell of asset for this qtr? for sure u know the answer. use of nnwc here is obviously juz to *leverage the bulk cash (highly questionable), which u HONESTLY point out "For PMCORP its purely asset play...". for this, u have my basic respect. PMCORP business is going downward that's a fact, don't be bias and dishonest... the 5 chopstick and FCF will failed big time calculated 5 years (heave lost 2008 - 2010) range, that's a fact, don't cover this fact by attack other, this is not FA already, this is TIPU.

now, if u read back, who started such hatred discussion? kua merely discussed with cosway saja, tak boleh ke? everyone must talke the same BS to post here ke? hahahaa..

Posted by iafx > Nov 20, 2013 04:42 PM | Report Abuse

@david, lookin for free lunch? hahahahaa... u can sell yr ball at pasar raya, crying for stagnant stock then :D :D :D


Want to bully david? Hey people got balls, you got or not?

david, take him on. Like I have said, you are much much better than him in financial knowledge. That I definitely can bet on that.

Ah see the more you talk, the more you expose your know-nothing. You don't know what is asset based valuation. You just copy and paste something from the report without knowing what we are talking about!

We are talking about if PM Corp liquidates its investments in quoted and unquoted share (only take the book value though most of the investments have appreciated in values by a lot), plus the cash it has, ignored the plant and equipment it has, ignore the investment property it has, pay off all, yes everyone of its liabilities, it still has cash per share more than its price.

We said the business is small, not significant. But it doesn't bleed cash. We are talking about now and the future, not the past how much it lost.

This is so simple and everyone with a brain also understood, except one with no brain like you.

Do I talk about its earnings? What are you chanting about? Do you know what are you chanting or not?

FCF? I say there is FCF. Do you know what is FCF or not? Do you know how to read financial statement that there is FCF or not?

Well as I have said this which I have never said it to anybody else. You know nothing, absolutely nothing about financial statement. Forget about valuation.

Your turn.

Mike, you are right about my posting. Only if you believe Zhulian's earings can grow by 23% for the next 5 years. And I also mentioned that it will be a great and difficult feat and i won't bet on that. Last 5 years growth is only 10% a year.

Posted by kcchongnz > Sep 24, 2013 03:34 PM | Report Abuse X

The mathematics of discount cash flow analysis is exact. If I were to use the last year's growth in earnings of 23% for the next 5 years, and a required return of 10%, the intrinsic value of Zhulian will be RM6.40.

Alas, I don't have a crystal ball and I won't know its future growth rate. to me if a company can compound its growth rate of 15%, that is already very liberal, and I won't use that rate to justify my buying or even holding of a stock.

Zhulian has a compounded annual growth rate of 10% for the last 5 years. In my opinion, if it can sustain that kind of growth rate every year for the next 5 years, it is already quite a feat.

The high growth rate of a company cannot carry on forever. it eventually will slow down because of many factors; size, competitions, economic cycle etc.

Posted by mikekong55 > Nov 20, 2013 02:57 PM | Report Abuse

kcchong, good afternoon. could you please look through your crystalball once again, does the intrinsic value of 6.40 for ZHULIAN still stand(your comments somewhere in september).If yes I'll buy some today.thank you.

Mike I got no crystal ball. When did I say the intrinsic value of Zhulian is RM6.40? The first time I talked about it, Zhulian share price was not even RM2.00, and that was less than a year ago, I think. So now Zhulian is 5+ already. What do you think?

Well I don't know how good is its overseas business, esp in Indonesia. It must be very exceptionally good to garner that kind of valuation now. I am in no position to know anything about it.

One thing we old timers must always remember, no matter how good a company is, it won't be a good investment if it is too expensive. In investing, risk means the probability that one won't get the return he wants in an investment, or even lose money. The higher the price in relation to its perceived intrinsic value, the higher the risk.

And one should never fall in love for a stock or company. We invest to get as much return as possible, not courting for a wife.

Posted by mktwatch > Nov 20, 2013 11:05 AM | Report Abuse
kcchongnz, I checked again yr earlier cal. U did not add any % of PPE N iNVETMT Prop (0%) to arrive at yr N/N Working Cap/share of 0.294. Yr NOS of 773,357M includes the Treasury shares of 64,959,800 shares which not in circulation.
To cal BV, if I were to just take the Equity/NOS, I might inflate the BV from what's it's really worth (Intangibles, like Goodwill n Trademarks might not fetch its NBV in the event of a break-up). So, better to exclude Intangibles in BV cal.
I agree with, though, that the PPE might not be worth The NBV shown. Better to give, say, 70% value to its NBV.

mktwatch, you are right. Excellent analysis.

Yes, I didn't put any value on the PPE at all and there is quite a fair amount of it. Maybe you can use 50% of its value. I ignored investment properties also because it is a small amount. But rightfully it should be there, even at 100%.

I also didn't take into consideration of the treasury shares. You are right here again.

The end result is my Graham net net valuation is even more conservative with the above left out.

Good work mktwatch. You are good.

bsngpg, I agree with this statement;

Posted by ipomember > Nov 20, 2013 11:35 AM | Report Abuse

No GLC is half right. lol

Oh thank you for asking about my MFCB. Actually my posting was for education purpose, not for shouting about prices like what you do everywhere.

But since you asked about the return, including dividend, it is about 10% since 3 months ago. Annualized would be 40% a year. Not bad eh? See below link:

http://klse.i3investor.com/servlets/pfs/21089.jsp

Of course it is not bad compared with the apaini AncomLB lah, which hardly moved at all. Its assets and earnings also is far far away from that of MFCB. And don't get panic when you see the 30% of the portfolio in just 3 months there, ok?

So that "half-past-six" valuation of MFCB is any time far far better than your minus half past six ranting on apaini AncomLB, isn't it?

You really make serious money in SBCCorp ka? But I accidentally saw this post here:

Posted by kakijudi > Nov 20, 2013 12:09 PM | Report Abuse

Jcool I thought last time you rubbish this stock? Why now suddenly 360 u turn. And why you deleted your posts. Takut malu kah? What a joker

This guy made some comments here and said I am dishonest and tipu for posting the above. And then he came with the following post. I was talking about an asset based valuation of Graham net net and he came with this thingy here about an investment strategy.

Totally "cow head not fitting the horse mouth"!

Please clarify if you know what is a asset based valuation liike Graham net net and a multi facet investment strategy, like the 5 yardsticks of Cold Eye.

By the way, please do not degrade a master like Cold Eye with your 5 chopsticks.


Posted by iafx > Nov 20, 2013 11:57 AM | Report Abuse

don't talk only, use the *famous 5 chop (or yard?) sticks or FCF to scrutinize this counter, download the latest qtr report, see how cash is generated, see page 8 performance review. see for yourself if there is BIAS and DISHONEST.

note this counter is related to troubled pmind, too. this is not a buy/sell call, pmcorp price still green as v speak, this is merely sharing a neutral view, yr $ yr choice!!

Thank you thank you. Jealous or not?

But but but, is 15 sen the lowest and 34 sen the highest? You don't even know how to read stock prices. OMG!

A very fair statement from david. This has nothing to do with his posts and why did you ask him to read his posts?

It is my accusation that you know nothing about financial statements. It is a strong statement from me you know. Why don't dare to take the challenge since you like to call me dishonest, tipu etc, just because I posted something you can't even understand? No balls ah?

david, I agree with you. You are much much better than him, any time.

I made the biggest mistake in investing in PM Corp? I bought at 15 sen, sold at 34 sen, for myself, my relative and my children. How is that the biggest mistake?

Where do you get the figure RM668.35? My book says 100 times of that. So???

By the way how is your AncomLB? You were chanting and chanting and chanting everywhere about AncomLB. So how much have you lost?

You make serious money in SBCCORP? Who the hell cares, like what you were chanting everywhere about AncomLB?

Well you have your own preference. Can't fault you at all.

But just one point here. whether a stock is cheap or expensive is not if it is 5 sen stock, or $50 stock. It is its price in relation to earnings, or assets.

Posted by iafx > Nov 20, 2013 11:57 AM | Report Abuse
don't talk only, use the *famous 5 chop (or yard?) sticks or FCF to scrutinize this counter, download the latest qtr report, see how cash is generated, see page 8 performance review. see for yourself if there is BIAS and DISHONEST.
note this counter is related to troubled pmind, too. this is not a buy/sell call, pmcorp price still green as v speak, this is merely sharing a neutral view, yr $ yr choice!!

That is why I said you don't know what is Graham net net valuation. You have no clue of what I am talking about. You have no clue about finance and investment. You are making a bloody fool of yourself.

Not only that, you have no clue about what ColdEye's 5 yardsticks (please don't criticize ColdEye with your chopsticks) are. Don't agree with me? I challenge you to use ColdEye's 5 yardsticks to evaluate PM Corp.

You have no idea how to read income statement and balance sheet, not to say cash flow statement.

Take my challenge?

When I talk about Plenitude assets, it is really very high quality; cash and investment in quoted shares, land bank which has not been revalued for ages etc.

These stuff alone after less off total liabilities, its value per share is still way above the market price now.

Posted by haikeyila > Nov 20, 2013 11:33 AM | Report Abuse

how bout 'No penny stocks'


Good one. Patimas is a classic example.

But seriously i am very sure they are some good penny stocks around too. It all depends on the price in relation to its earnings and or assets.

Tambun has been doing very well, yes. If you are interested, you can read my opinion in one of the threads here.

Plenitude is a different story. It is not that aggressive in recent years and revenue and earnings growth is not good, but it really has huge amount of cash.

so which company is better to invest is a matter of personal choice. For me I am a conservative investor and I prefer to be safer. Plenitude, because of its high quality assets it has, is my preference.

I set up this thread 8 months ago with the intention of discussing with this iafx fellow about finance and investment. However this guy never have the guts to come here to have some intelligent discussions. Instead he went everywhere making a fool of himself. How time flies.

Later we used this thread as a discussion forum for some investment concepts, financial statement analysis etc. There were quite some good discussions here. Too bad it has been a long time nobody visits here already. Can I revive it for the benefits of most of us.

Ok now let's discuss about Graham net net valuation. Tan KW has posted a good article about it here:

http://klse.i3investor.com/blogs/kianweiaritcles/38350.jsp

I have tried to use this method to value PM Corp, a cash rich company with little significant business.

Somebody by the name iafx said I bias, dishonest, tipu etc. Why trying to do something like that is considered as such? Let us discuss. Here is my post:

Posted by kcchongnz > Nov 19, 2013 06:50 PM | Report Abuse X

This interim result confirms the profit of 22m from the sale of property mentioned by calvin earlier on. However, the performance of the chocolate business remains illusive. Without this one off gain from the disposal of property, there will be no profit from the ordinary business. When is its chocolate business going to show some good results?

However, from this interim result, it reinforces my commitment in investing in this stock. This is due to further strengthening of its balance sheet. The Graham net net valuation (as below) shows that its intrinsic value is about 30 sen per share, up from my 24 sen previously. This is due to the realization of its gain in the sale of the property. If what calvin said about its other undervalued assets is true, further unlocking of the value of the assets of PMCorp will strength its case more as a good investment.

PMCorp 30/9/13 BS Amount Weight Net-net
Cash and equivalent 139616 100% 139616
Investments 82275 100% 82275
Receivables 21150 75% 15863
Inventories 16663 50% 8332
PPE 31472 0% 0
Goodwill 63190 0% 0
Other assets 1451 0% 0
Total assets 355817 x 246085
Less totalliabilities -18695 100% -18695
Equity 337122 x 227390

Number of shares 773356 x 773356
NAB 0.480 x 0.294
NTA 0.354 x 0.294

You see you are attacking a person; "BIAS, DISHONEST"? Why do you attack me as dishonest?

Anybody finds me bias, in what way? Dishonest, in what way?

More than that? How much? How do you come to the figure, if any?

What lobang? Tell us specifically what lobang you are talking about. If you have balls at all, let us go to the below link purposely set up for our discussion about finance and investment.

http://klse.i3investor.com/servlets/forum/900218979.jsp?ftp=1

Don't distract others from discussing about investing with your good-for-nothing ranting. There is no substance in your rants.

Posted by iafx > Nov 20, 2013 10:16 AM | Report Abuse

@member41, note the sales keep dropping and not isolated to this qtr.

@cosway, for that, u can use net-net working capital to ignore this in order to come out a "beautified biz value". my goodness...

u r one good guy, but their $ their choice. anyone who is interested, try download latest qtr report goto page 8 as a start. this is certainly not nnwc meant for.

btw, congratulate those who earned big real $ out of this ;)


If I were you who knows nuts about any finance and investment, I would keep my big mouth shut instead of trying to ridicule others.

"this is certainly not nnwc meant for."? Tell us in precise explanation why do you understand about Graham net net valuation. I bet you know nothing, absolutely nothing. Kosong!

mktwatch, if you look at my calculation of net net, I have already included a fraction of PPE and investment property into the calculation. So if you add those in, you may have double counted.

Your book value is simple. Just use the equity divided by the no. of shares, that is the book value. So price-to-book value is just the price/BV.

However, in many companies, a lot of their assets are made up of lower quality assets such as inventories which can be obsolete, plant and equipment which are old and hence may not worth much in relation to the book value, or questionable receivables which many not be collectible. Hence these assets could be low quality and do not worth what are stated in the book.

Price-to-book is just a guide of value, but as described above, it may not be true.

great maxim from tptan. With this half the battle in Bursa have already won.

Posted by mktwatch > Nov 19, 2013 10:03 PM | Report Abuse

Re: PMCORP. kcchongnz, can i compute add a N/N Tangible Asset per Share to yr N/N Assets per Share, and treat it as the BV/Share?

mktwatch, try to understand this valuation method by Benjamin Graham decades ago as posted by Tan KW below.

http://klse.i3investor.com/blogs/kianweiaritcles/38350.jsp


I value PM Corp based on this method as at present, PM Corp doesn't earn much. Hence the earnings based model such as PE ratio, enterprise value, discount cash flow etc have not much meaning, unless you want to project future earnings which I find it is very difficult and inaccurate.

Basically the method is as follow:

Net Net Working Capital = Cash + Short Term Marketable Investments + Accounts Receivable * 75% + Inventory * 50% – Total Liabilities

The cash and cash equivalent is taken as 100% value as they can be liquidated and get to close to the market value. The receivables and inventories etc values are only taken as a fraction of the book value. Hence generally this asset based method of valuation is conservative.

Why do you want it to be conservative? You want a safe margin of safety before investing.

This interim result confirms the profit of 22m from the sale of property mentioned by calvin earlier on. However, the performance of the chocolate business remains illusive. Without this one off gain from the disposal of property, there will be no profit from the ordinary business. When is its chocolate business going to show some good results?

However, from this interim result, it reinforces my commitment in investing in this stock. This is due to further strengthening of its balance sheet. The Graham net net valuation (as below) shows that its intrinsic value is about 30 sen per share, up from my 24 sen previously. This is due to the realization of its gain in the sale of the property. If what calvin said about its other undervalued assets is true, further unlocking of the value of the assets of PMCorp will strength its case more as a good investment.

PMCorp 30/9/13 BS Amount Weight Net-net
Cash and equivalent 139616 100% 139616
Investments 82275 100% 82275
Receivables 21150 75% 15863
Inventories 16663 50% 8332
PPE 31472 0% 0
Goodwill 63190 0% 0
Other assets 1451 0% 0
Total assets 355817 x 246085
Less totalliabilities -18695 100% -18695
Equity 337122 x 227390

Number of shares 773356 x 773356
NAB 0.480 x 0.294
NTA 0.354 x 0.294

XingGuan? Damn good man!

Posted by tj86 > Nov 19, 2013 03:40 PM | Report Abuse

Hi Kc, what do u think on XinquAn? Is it a good stock to invest?im still worried in investing chinese company...plz enlighten me thx

Yeah the performance is damn bloody good. Heaps of cash. But only if you trust its account.

Investing is really a jungle out there. Even you visit their factories, talk to the management, got a brother-in-law working as a senior partner in the auditing firm for Xingguan, you still can lose plenty of money investing in it.

That is what happened to Koon YY, a very successful investor. What's the chance for people who know nothing about investing and lazy to learn about it, except listening rumours here and there and punt.

tony, I see that you made a lot of money from this warrants of this illiquid stocks; no fund manager covering it; not in the apaini stock tracker, etc.

Me too. I bought a lot average at about 45 sen and sold all at about 59.5 sen. 30% gain in 3 months from this damn bloody illiquid stock, non investment grade.

Sime call warrant CW (19/11/13)

Sime Call Warrant CW is trading at 10.5 sen while the underlying share is at RM9.80 now at the morning close on 19 November 2013. It has an exercise price of RM 9.40 and the expiry date is on 30 May 2014, or more than 6 months time. The conversion ratio is 4:1.

The call warrant is hence in-the-money with an intrinsic value of 10cents. If you buy CW at the price now of 10.5 sen now, you pay a small premium of half a sen, or 0.2%.

It is indeed a surprise that with a such a high gearing of 23 times of CW, or an effective leverage of 15 times, the premium asked is so small. Moreover, the expiry date is still a long way to go. Hence if you are bullish about Sime, CW offers an extremely good and exciting punt.

The table below shows the percentage gain/loss of CW with the settlement price of the underlying share at the expiry date.


Uly Price 9.40 9.60 9.80 10.00 10.50 11.00 11.50 12.00
Uly gain/loss -4.08% -2.04% 0.00% 2.04% 7.14% 12.24% 17.35% 22.45%
CW gain/loss -100.0% -52.4% -4.8% 42.9% 161.9% 281.0% 400.0% 519.0%

Kuchai?
Posted by The Picker > Nov 19, 2013 11:31 AM | Report Abuse
Good day to you KC~
Do you think KUCHAI is a hidden gem?
Kuchai is trading at RM 1.22 now with PE ratio 3, and NTA 2.65. Would like to know if Kuchai have lots of asset?

Kuchai is a 100% investment company. It does not have any significant business, maybe just a few hectares of plantation here and there.

Its assets are all in cash, equity investment, properties and investment in its associates. All these are hard and quality assets which can readily be converted to cash. It has negligible liabilities.

Hence your NTA of 2.65 is about what it is worth, in my opinion. Kuchai just need some catalysts to unlock its huge undervalued assets such as good special dividends, privatization, or a raider to come in (hard as the related companies shares in Kluang and Sg Bagan are crossly held).

Kuchai will be a great reward for investors who are very patient.

Ulicorp good to invest?

Posted by sklyte > Nov 17, 2013 09:56 PM | Report Abuse
Hi Kcchongnz , I have ulicorp n epmb. Yeoman fund just bought into ulicorp . Heard it invest in undervalued co. Share of ulicorp up from 80cts to 1.02 now. Is it worth holding? Epmb a laggard. At 73cts, can hold? Thanks

First time look into Ulicorp. let us base on its latest annual financial results dated 31/12/12 and use ColdEye's 5 yardsticks to evaluate and see.

United U-LI Corporation Berhad (U-LI) is engaged in the manufacturing and trading of cable support systems, cable management systems, integrated ceiling systems, building materials and light fittings. It has three segments: Investment holding; Cable support systems, and Electrical lighting and fittings.

Yardstick 1: ROE
Ulicorp reported an earnings attributed to common shareholders of 17m, or EPS 12.9 sen for the year ended 31/12/2012. With its net asset backing per share of 72 sen, ROE is 9.6%. This is lightly less than 10% and hence marginally acceptable.

Yardstick 2: Cash flow and free cash flow
The average cash flow from operations (CFFO) from the last two years is 19.3. This is 116% of its average earnings of 16.3m. This shows its good quality of the earnings. After spending 5m in capital expenses, there is a free cash flow (FCF) of 15.4m. This FCF is high at 10% (>>5%) of its revenue.

Yardstick 3: PER
Ulicorp is trading at 1.03 now. With EPS of 12.9 sen, the PE ratio is 8, or less than 10. This is inexpensive.

Yardstick 4: Dividend yield
Ulicorp paid a dividend of 4 sen for the last financial year, or a dividend yield of 4%, higher than the FD rate. This dividend is paid through the FCF, not from borrowings or additional share issues. This is another tick.

Yardstick 5: NTA
The net asset backing per share of Ulicorp is 1.34 compared to its price of 1.03, or a price-to-book ratio of 0.8 which is less than 1. This is ok, bearing in mind it has an excess cash backing of 30m.

Ulicorp seems to meet all the criteria of Cold Eye as an investment. Although its operating efficiency in ROE is marginal, the asking price is low and hence the risk will be lower accordingly.

The latest two quarter results ending 30 June 2013 shows there is a vast improvement in its earnings by 72%. The cash flow appears to be not as good though.

Hence according to the 5 yardsticks of ColdEye, Ulicorp is an investment grade stock.

gark, definitely it is a coincidence that two completely different methods using different data came up with an approximately the same intrinsic value.

The interesting part is both the above method assume no growth in earnings in Kfima's business from now on. This is conservative as generally the cash flow should grow at about the inflation rate, at least.

I remember one investment bank also came up with the same fair value some time ago using another completely different approach, a comparable PE ratio.

All these valuations were done independent of each other as one can clearly see.

Ah, I may be unknowingly trying to justify the value of Kfima here, a cognitive confirmation bias.

I said FCF is 82.7m what?

Oop yeah ah, not the latest post. Earlier post yes.

Thanks again.

Yeah lah last night too much wine. got to wake up often to pee. Some more got to wake up this morning at 5.00am to get ready to go play golf. Hence not enough sleep.

Posted by gark > Nov 18, 2013 01:58 PM | Report Abuse

Great article... on the intrinsic value of Kfima's share. The author knows what he is talking about.

http://greedydragoninvestment.blogspot.com/2013/10/invested-in-kumpulan-fima-part-1.html

This guy made a valuation of Kumpulan fima assuming its business's cash flow is perpetual with no more growth. This is a conservative assumption. He came out with an intrinsic value of RM3.30.

I used earnings power valuation which also with the conservative assumption of no future growth for Kumpulan Fima's business but with different data, discount rate, and method, and I have the same valuation as his. Is it a coincidence?

http://klse.i3investor.com/blogs/stock_pick_challenge_2013_2h/34118.jsp

gather evidence and make fun of me? Be my guess.

fortunebull, tell you the truth, if I want to make fun of you, I can just base on your postings and I can make hell of fun about you. I just don't want to go that low.

A company with no business at the moment, except the hope that the rig will reach where by when and when, And the hope of striking oil. Living on hope, but be careful ending eith a hole full of soap.

Just about to say this is the only stock in my portfolio which have not moved. Now cannot say no more.