Warisan has just released the 1Q2012 results. The earning per share shot up from 3.28 sen to 6.33 per share. That is a jump of 93% compared to the results of 1Q2011. This is only the beginning of Warisan's growth. As the commercial truck business picks up gradually, the earning will also gain momentum. Besides, the asset backing is currently RM3.95 per share. Watch out for more growth in the coming quarters.

Here's how Capital Reduction is done:

Currently SB has 400,000,000 shares @ Par Value of 50sen each which has a total capital value of RM200 million. Due to the losses incurred recently, net asset value of SB share is only say 5 sen per share which will work out to a total capital value of RM20 million. The white knight would propose to reduce the existing shareholding of 400,000,000 shares to 40,000,000 shares of 50 sen each to reflect the actual capital. This means 10,000 existing shares (with asset of 5 sen each) will be combined to form 1,000 new SB shares of 50 sen each.

By pumping in RM20 million to buy new issue of 40,000,000 shares, the white knight would end up with 50% control of the company.

All these figures are hypothetical for illustration only. You must wait for actual details of SB's financial position to determine the extent of capital reduction, if they opt to do it.

The biggest risk for Silver Bird is capital reduction even if there is possibility of white knight coming on scene. No businessman would buy liabilities. They would reduce the shareholding to such level as to reflect the real financial position before they are willing to pump in fresh capital. This is to protect their capital from being diluted. Perhaps, it is worth waiting until restructuring plans are revealed.Certainly there is some value in the strong branding of the company.

Aeon Credit would probably be one of the greatest beneficiaries of Government pay-rise. First, the existing customer base of the company comprises a large percentage of civil servants. Secondly, the company's easy-payment scheme is very wide-spread in major towns of Malaysia including Sabah and Sarawak. This scheme is very popular among civil servants and other bumiputras. Despite slower economic growth this year, Aeon Credit is confident of strong earning growth this year. The potential is all shown up in the current surging share price, RM10.70 today's closing. I won't be surprise to see Aeon Credit hitting RM12 before the end of 2012.

CCM owns about 73% of CCMDBIO. CCM is not doing well. It is possible CCM could be one of the 5 to be sell off. I am just speculating, don't believe what I say. It will be better for someone else to control CCM so that CCMDBIO can chart a new direction, including selling a substantial stake to foreign drug company such as GSK, Bayer or Pfizer. Let's wait for further announcement from the Government, it should not long, probably before election.

Warisan has recently launched another line of products: dump trucks, cement-mixer trucks and prime movers. All of them are heavy-duty China made trucks. The sales would pick up slowly as they are new in Malaysia. Short term contribution would be insignificant but in a longer term, profit generation could be quite substantial.

I do not know of the real story of the drop. However, this is my take on the scenario judging from the market movements and the fundamentals of the stock.

Someone held quite a big stake in CCMDBIO, a few hundred thousand units, for too long. As the stock price has not been moving for the last few years, they decided to dump all. The sellers might have other reasons peculiar to themselves, certainly nothing to do with CCMDBIO.

I noted another interesting thing. While the price was dropping below RM2, the chairman of CCMDBIO was buying. Another director bought into the counter when the price rebounded above RM2.

Aeon Credit hit intra-day of RM10 today, that is quite spectacular. Sun Biz reported that Aeon Credit may propose a Bonus issue (yesterday news). Upon query by Bursa Malaysia,Aeon Credit admitted that a corporate exercise has been discussed in the recent Board meeting, without giving any details.

The best policy for existing shareholders is to wait for further announcement. There is no hurry to sell the shares as the company is expecting another good year with strong growth. Current fundamentals are excellent: earning of 79.67 sen per share and annual dividend of 30 sen single tier.

Shares belonging to suspended Silver Bird Group Bhd managing director Datuk Jackson Tan totalling 2.01 million were force-sold at prices ranging from 18 to 18.6 sen from March 14 to 20, filings with the stock exchange show (Star Mar 24).

Silver Bird is holding on quite well at 18 sen attracting some support from retail players. Continued forced selling by bankers would hamper any attempt by the market to push Silver Bird to higher price. The financial position will remain unclear until results of forensic auditing is known.

Mulpha is holding quite well at around 42 sen. However, the price is basically supported by the company's share buy-backs. It would need more positive market sentiments for Mulpha price to be self-sustaining or self-propelling.

Silver Bird is facing a very critical level at 0.17, just 1 sen above the all-time low of 16 sen. If it bounces off from this level, the price may stop sliding, at least temporary. If it decisively breaks down below this level, it is anybody's guess where the bottom would be.

Congratulations tptan! You have really struck the right stock. It is very rarely to get a stock that can double within 6 months!

Silver Bird said in an announcement with Bursa Malaysia that Maxis notified Stanson Marketing Sdn Bhd, a Silver Bird subsidiary, that its distribution agreement has been terminated. Silver Bird is seeking legal advice on the matter. (Star 16 March). That's another cockroach, albeit a small one. (Read the Cockroach Theory posted earlier)

Aeon Credit hits 8.60 this morning, up by 0.54 since I wrote on March 12. It is now moving into uncharted water. How high it will move is anybody's guess. it is pertinent to note that the financial year results ending Feb 20 is forth coming anytime from now to April 20.

As pointed out last few weeks, the expected whole year earning is 0.70 and whole year dividend 0.28 (interim dividend paid 0.132)

(This article is for information only and represents author's own opinion. Please do your own research if you are intending to buy or sell)

One has to face some hard facts now. JCY failed to penetrate the strong barrier at 1.60 and is retracing. If one looks at the chart, a head and shoulder pattern has been formed and points to the possible low of 0.80 to 0.90 if the current price breaks below critical support of 1.10 (hopefully that would not happen).

There is a glimmer of hope, even at 0.80 to 0.90, the price is above 200 MA line. It all depends on the 2Q results to be announced between April and May. If 2Q result is as good as 1Q, that might spark off another rally. If 2Q result does not meet market expectation, I think JCY can "tutup kedai"

A tale of two sisters: Aeon & Aeon Credit. Both companies are controlled by the Aeon Group Japan; they are in totally different businesses. Aeon operates something like 28 supermarket cum department stores under the brand name of Jusco, Aeon Credit runs consumer financing business with 30 branches.

Aeon share is priced at RM9, earning at 0.55 with dividend of 0.145 (31 Dec 2011)

Aeon Credit share is priced at RM8.06, expected earning at 0.70 with expected dividend of 0.28 (20 Feb 2012)

In terms of fundamental, Aeon Credit is a better buy. In terms of stability and resilience, Aeon is a better buy because Aeon's business is more defensive and it owns a lot of landed property.

(This article is for information only and represents author's own opinion. Please do your own research if you are intending to buy or sell)

Lafarge's current earning is not exciting compared to its peers like Tasek and YTL Cement. This is because Lafarge's earning is weighed down by the 30% of its total production being exported at very thin margin of profit.

All other cement companies are virtually in full production for domestic market. Hence, the earnings would not change very much even if demand picks up because they do not have much room to increase production.

It is quite a different story for Lafarge. The 30% exported cement can be re-channeled to domestic market which could rake in substantial earnings. It would normally take 2 to 3 years to build an integrated cement plant if other cement companies decide to increase their capacities. By then, the construction game might be already over the hill.

(This article is for information only and represents author's own opinion. Please do your own research if you are intending to buy or sell)

MSC's latest development: The company took in an Indonesian partner with a stake of 23% in its Indonesian operation PT Koba. That shareholding will later increase to 50%. On the surface, MSC is losing out because its shareholding is being diluted. However, this move is necessary for the following reasons:

a) MSC's tin mine in Indonesia is expiring in 2013. Local partnership is part of government's requirement for licence renewal.
b) New local partner will assist acquisition of additional mine

So, it is a win-win situation for longer term benefits. One must bear in mind, Indonesia is the World's largest tin exporting nation. China, though is the largest producer of tin in the world, uses up everything.

(This article is for information only and represents author's own opinion. Please do your own research if you are intending to buy or sell MSC)

Once upon the time, Mieco was owned by the Multi-Purpose group. The company was the market leader in chipboard production. Mieco then was flushed with a pile of cash of more than RM150 million, paid dividend regularly and the share price hovered in the region of RM2+.

Somewhere along the timeline, Mieco came under the control of a Pakistani through the parent company, Bandaraya. The new owner emptied Mieco's coffer of RM150 million and borrowed another RM150 million to build a new plant.

Before the new plant could generate a cent of profit, the whole chipboard market went into storm with product prices falling and operating cost shooting the roof.

That spells the downfall of Mieco. The company has been struggling for the last 7 or 8 years and it remains a penny stock. Is there light at the end of the tunnel?

The Silver Bird has turned into a virtually worthless clay bird now. There is an investment theory called Cockroach Theory. When you spot an cockroach, that is not the only one around; there are tens and hundreds of them hidden somewhere.

What this theory says is this: when a company reveals bad news to the public, there may be many more related negative events that have yet to be revealed (Investorpedia).

Let's watch as the Board open the cupboard and see how many cockroaches are in it! I am predicting the share price will go below 0.15 next few months

Another Infra project may be launched within next 1 0r 2 years - KL-Singapore High Speed Rail Project (KL-Sg HSR) and the cost is a staggering USD10 Billion or RM30 Billion. The government is serious about the project because it will bring tremendous travelling convenience and economic development. Due to very short travelling time, just imagine 1 hour from KL to Singapore, tourism, retail and property businesses will sky-rocket. Those who have taken HSR or popularly known as Bullet trains in Europe, Japan and China will know how fast and comfortable these trains are.

KL-Sg HSR project will exert more pressure on the demand of cement, which is needed in large quantities for various forms of civil works. Remember: there is only an excess capacity of 3.6 million tons of cement per year in the Malaysian market. And that excess capacity belongs to Lafarge. Import of cement is not feasible because cement is bulky and heavy and freight charges are far too high!

Warisan's future hinges on marketing viability of Bison trucks- rebadged Foton trucks from China. People may doubt whether China trucks would sell in the Japanese-dominated Malaysian market, linking them to the similar fate suffered by China-made saloon cars.

Bison trucks would gradually gain acceptance in Malaysia as in other countries due to the following reasons:

1) The pricing is competitive, cheaper than any other Japanese models.

2)The quality is high with Euro 2 engines, and tested in the vast region of China as the NO. 1 truck of the country.

3)If you are a businessman, you may not want to drive China-made cars for obvious reasons, but you would not mind buying China trucks for your factories because they are cheap and good.

4)Bison is marketed by Warisan's sister company Tan Chong which has a wide network of potential customers. Bison is a cheaper alternative to Nissan and UD trucks sold by Tan Chong.

Mulpha is resting precariously on the 200MA line, uncertain of which direction it would go. It all depends on the underlying market forces of Bursa Malaysia. If bullish sentiment prevails over bearish mood, there is a chance Mulpha may bounce off from the 200MA line and begin its attempt of the 3rd wave march. However, if Mulpha breaks below its 200MA line at 42 sen and further below its 50MA at 41 sen, then the 5-wave theory will not hold any more. It will be back to square one - hibernation.

There is a glimmer of hope for Mulpha - the company is fairly active in supporting the price by buying back shares, especially in bear market. A cautious reminder here: Golden Sachs still holds some Mulpha shares and they are probably still selling.

Aeon Credit has just hit RM7.52 this afternoon. Another potential area of strong growth is Credit Card. Currently, the company has issued around 150,000 cards and the segment has just broken even.

The company also manages the royalty card called J-card for the sister company Jusco. Last year, Aeon Credit launched two-in-one Visa-cum-Jcard for the convenience of Jusco customers.

Jusco has something like 1 million J-card holders throughout Malaysia. Each of these card holder is a potential candidate to be a holder of two-in-one Aeon Credit Visa card. Overtime, many of these J-card holders may just opt to convert whatever cards they have to Aeon Credit two-in-one Visa card, for convenience and easy keeping.

While uncertainties abound in the global economy, Malaysia is pushing ahead with full steam a long list of infrastructure projects - MRT, KLIA2, Iskandar Development Region, Expressways, water projects ... virtually endless with contract values running into tens if not hundreds of billions Ringgit.

Of course, first beneficiaries that come to mind are the construction companies. But the big question is who will get what and will they make profits, with the high-risk nature of construction industries.

Sit back and think for a while. The most likely and more certain winners will be material companies, particularly cement. Without cement, all projects will stall. Projects and developments need millions of tons of cement, literally. The only cement company that has excess capacity that can meet any rise in demand is Lafarge, with current 3.6 million tons being exported to overseas at razor thin profit. That excess cement can be diverted to local market with a short notice.

Aeon Credit will continue its growth for many years to come because it makes life so easy for anyone who qualifies to apply for easy payment of consumer products.

For example, a branded Flat screen TV costing RM2500 can be taken home for a mere payment of less than RM110 per month over 3 years. The approval process takes only 30 minutes if the applicant has all the supporting documents ready.

The business is very lucrative: the company will make a total profit 54% over 3 years of the TV mentioned above. The default risk is minimum because the company has a very stringent vetting process of would-be customers.

In analyzing Lafarge's earning, you must also consider "Depreciation and amortization (D&A)" which is deducted from net earning. D&A are paper write downs on plant, machinery or land leases but the money is in the company in the form of cash. In the absence of any capital expenditure, the cash can be distributed as capital repayment.

Lafarge has D&A of about RM160 million in 2011 or 18.8 sen per share. Thus the real earning is 55.8 sen per share. Coupled with potential diversion of exported cement to domestic market, the potential earning is RM1.058 per share (34+18.8+50). Discount whatever risk and uncertainty and derive your own estimation of future earning.

Much patience is required for the next round of bull run. Two possibilities could trigger the next rally with current fundamentals intact. First, of course is the ramping up of price for another investment bank to issue a new batch of call-warrants. Second, the current free-float of JCY shares is below 25% mandatory requirement for public listing. The controlling shareholder might ride on the bullish factors to place out a batch of JCY shares at an attractive price - at least similar to last IPO price of 1.60 or higher. Watch for possible announcements next few months!

Do not worry too much about SSD, it is too expensive for the time being for mass storage. Check it out how much it would cost to buy 500G of SSD, it may blow your mind!

CCM DuoPharma holds a number "strategic" drugs for the government hospitals: anti-retroviral drugs for the treatment of HIV-infected patients; methadone for drug-addict rehabilitation; and Omiflu, a generic Oseltamivir (Tamiflu) for H1N1 infection. The company is either the exclusive or the main supplier of these drugs, which will keep the bottom line stable.

Aeon Credit earning is expected to grow steadily with double digit rates, at least for the next few years. The company has a very aggressive marketing strategy to reach the masses: internet, branch promotions, through sister company Jusco.

Annual earning of Last financial year was 52.86 sen per share. The earning of current financial year ending Feb 2012 is expected to be in excess of 70 sen per share.

To scare people into selling so that big timers can buy in cheap stock to prepare for the next round of "Goreng", possibly next few months

Lafarge is priced at a premium by the market. Apart from its potential additional earnings from the possible diversion of its 30% exported cement, here is another reason.

The company pays out about 91% of its total earning in 4 quarterly dividends. This is very important to minority shareholders. A bird in the hand is worth two in the bush.

With current total single tier payout of 34 sen, the net return is 4.75%, far above FD rate of 3.1%

Manulife has recently released the 2011 results: earning of 33.29 sen per share with dividend yet to be declared, expected to be more than 18 sen gross.

The insurer's earning could be on the rising trend as a result of insurance distribution tie-up with OSK which has 50+ branches through out the country. Manulife's asset management division can be a potential money spinner as return of the unit trust is among the highest, in excess of 10%.

Warisan has just released the 2011 results: earning of 21.02 sen and a final dividend of 6 sen (interim 6 sen). There is substantial increase in profits across all segments except Automotive.

Despite the high turn over and profits, the overall result is not impressive because it is offset by high starting cost and expenses of Automotive Division.

Going forward, the profit should increase significantly as sales of China trucks pick up this year. This stock is certainly worth watching. The earning can surprise the market next two years.

Manulife is the only pure Life insurance listed company in Malaysia, with a relatively small paid up capital of 200 odd million shares. The ultimate controlling shareholder is the Manulife Canada - a very reputable and one of the leading insurer in Canada and North America. Currently, they hold close to 58% Manulife Malaysia, but they are buying from the open market every day; they have the option to buy up to the maximum of 70% permitted by Bank Negara.

The 2011 result is pending, earning may hit more than 0.30 and dividend may exceed 18%. I am predicting a price of more 3.50 in the next few months

This is called "rigging". Two related person, A sells to B, then B sells to A at certain price. There is no net selling, but other small timer may follow sell and A or B will "sapu" the shares. Of course, this practice cannot go on forever. First, it is illegal, too obvious or too much of it may attract attention of regulating authority. Secondly, it is costly, there is commission to be paid for every transaction.

JCY is beginning to move now. It will take a couple of days to allay the fears that had been sown by the now-expired CD issuer. On top of that, there is possibility that the issuer might keep the price subdued in order to buy back borrowed stocks. However, no single person except the controlling shareholder, can come against the market forces. The real show is probably coming next week.

Aeon Credit is the market leader of easy payment and consumer financing in Malaysia. Although the customer base comprises mainly low to medium income groups, the profit margin is very high, in the region of 20%. The default rate is very low, around 1.8%, way below industrial average of 2%+.

Recent pay revision of civil servants augurs well for the company's business. The company is expanding every year, opening up new offices in major towns in both East and West Malaysia.

The company pays consistent dividends, increasing every year in tandem with growing income. Dividend of last financial year was 26.5 sen. You can expect dividend of close to 30 sen this financial year. The interim dividend paid was 13.2 sen T.A.

The current price is 7.14 based on last Friday's close. I am predicting that price will move above 7.50 next few months.

CCM DuoPharma is a boring defensive stock with an unwritten dividend policy of 75% payout. The earning was not affected at all even during the sub-prime crisis and the Euro debt problem.

Rain or shine, you will get a generous dividend payout every 6 months. There was one year they paid out 48 sen per share! Treat this stock as a kind of FD, and any earning surprises of take-over offer as bonuses.

If you walk past any government clinic or hospital, you will see queue after queue of patients waiting to collect their free medicines. Government spends billions every year for public health care. The queue for free medicine is going get longer each year as cost of private health care sky-rockets.

CCM DuoPharma, being a GLC, will always get a fair share of the supply contract to the government hospitals.

Do not worry too much about the 4Q11 results and the share price. More than 25 sen per share of losses are due to impairment write down. These are paper losses which had been paid for and do not actually affect cash flow. This means the actual income flow in 2011 is 86 sen per share(61 + 25). A glance at the company's cash flow table reveals that the the cash position has increased from RM119 million last year to RM235 million by end of 2011.

I think the downward 2nd wave has completed by bottoming out at 0.42 yesterday. Looks like 3rd wave is beginning to unfold today by moving to intra-day high of 0.44 in the afternoon. Let's watch whether 3rd wave can be confirmed next week.

Unfortunate! Unfortunate! MSC 4Q2011 results was disastrous. Instead of the expected bumper profits, it turned in a humongous loss of 46 sen per share. However, the whole year earning is still attractive at 61 sen. A final dividend of 18 sen was declared (interim 12 sen)

The loss was unexpected and was beyond the control of the management. It was incurred by the Indonesian subsidiary Koba Tin. The Indonesian Government banned the export of tin in Oct 2011 for a few months in order to prop up tin prices. The ban affected production and sales revenue. In addition there were some impairment write down of investment.

Despite 4Q losses, MSC is still solid financially and future earning will improve as sales and production in Indonesia return to normal.

JCY is grossly oversold in the past one week, with OSK as the most aggressive seller. OSK may have run out of bullets. As the week closes and JCY-CD expires, price of JCY might spring up like a "Jack in a box", as mentioned in earlier comments.

OSK can still press JCY price down by selling borrowed stocks until tomorrow. But OSK will have to buy back JCY shares after CD expires. Therefore, the real jump will take place in early March.

CCM DuoPharma has just announced the 2011 results. The earning of 19.24 sen is marginally lower than last year's 20.65 sen. However, total dividend of 18 sen (3.5 + 14.5) is higher than last year's 15.5 sen.

Going forward, earning should improve with all the expansion programs completed recently.

CCM DuoPharma could also be a potential target of take-over by international drug companies such GlaxoSmithKline (GSK) or Pfizer or any other foreign companies. In fact, there was rumours that GSK was acquiring CCM DuoPharma last year.

Foreign drug companies are interested in local drug companies because of the domestic generic drug manufacturing facilities. Foreign drug companies want to expand into local manufacturing market but it will take a long long time to obtain government licence and approval from the health authority. The quickest way is to acquire local drug companies which already possess relevant licence and approval.

Secondly, local generic drug do not have international branding which is very important for marketing particularly to overseas countries. Hence, it would be a win-win situation for local drug companies to team up with international big names.

Lafarge valuation is high compared to its peers such as Tasek and YTL Cement. With the earning of 0.37 for the year ending Dec 2011 and the closing price of RM7.34 today, PE ratio works out to 20, which is fairly high. High PER of blue chips generally may indicate some kind of future growth or potential.

What goody is there in Lafarge that warrants such high valuation? The answer is in its 30% (3.6 million tons) exported cements.

The exported cements are priced at around USD45 per ton or around RM140 per ton. This is about the break-even cost. The domestic cement price is about RM300 per ton.

Here lies the gold mine. If all the exported cements are diverted to domestic market when demands pick up, there is a potential additional earning of RM160 per ton. That would work out to total additional net pretax earning of RM576 million or net additional earning of RM432 million or 0.50 per share.

Hence, Lafarge has the potential of hitting net earning of 0.87 per share. Of course, this is just on paper. How high can the actual earning be in the longer term? Well, your guess is as good as my guess.

May be slightly in terms of image and perception but not in performance. On the contrary, HQ problems may benefit local minority shareholders. The local Lafarge may pay higher dividend or capital repayment in order to repatriate money to the HQ in France. They may even consider selling off the local Lafarge if the HQ is really desperate. They sold more than 10% of local Lafarge shares at RM6+ to institutional investors 2 years ago.

Lafarge is an investment-grade blue chip, paying consistently quarterly dividend of 8 to 10 sen per share. All the infra projects particularly the MRT are coming on stream this year. Cement demand is expected to increase in the coming two or three years. Being the market leader with more than 40% share, Lafarge will probably be the greatest beneficiary.

JCY is laying a "bear trap". The bears are driven by fears sown by the current call warrant issuer into the trap and they will all perish in the stampede of the charging bulls as February comes to the close.

The present known fundamentals of JCY are too good for the share price to hover around 1.18 region. It is an anomaly. Whenever there is an anomaly, market will correct by itself in due course, just like water finds its own level.

ahyeo: If nobody wants new CW, that means the parent share is not attractive for market play; life will go on as normal. Usually, investment bank would choose speculative counters so that there will be interesting shows and hence create opportunity to make money.

Mulpha has decisively broken through the 200MA line and the 20MA is touching and about to cross 200MA line. Quite obvious, Mulpha is embarking on a short to medium term uptrend climb. In such situation, Elliot Wave Principle is probably the best approach to predict Mulpha's future move (1st Up, 2nd Down, 3rd Up, 4th Down, 5th Up).

Mulpha has completed the 1st wave by moving from 0.38 to 0.50. Currently it is moving downward on its 2nd wave from 0.50 to 0.46 approximately. 3rd wave is about to break out in a few weeks' time, probably moving upward from 0.46 to 0.56 region.