I am not an expert in property, but I do know it is VERY VERY DIFFICULT to see anything about a place 15 years from NOW, as there is so many NEW VARIABLES in between. Just like say more than 20 years ago, Bandar Utama/The Curve, is just an oil palm plantation. Today, would you believe it, One Utama, with New Wing, The Curve, Kota Damansara, Empire City (bigger than One Utama) is up soon )with SPRINT, PENCHALA LINK, KERINCHI LINK, and many new highways.

Similarly, when you drive into Bandar Utama (before the development more than 20 yrs ago), not many can see what is today (else you would have bought a few units of BU houses). It is really very very difficult to predict for 20 years (hardly any good access road then). I think we are looking at too long term here. Just take look at it over the next 2-3 years and the launching they have done over the last 2 years, see if their take up rate is good. Follow the more recent launches (property market is flat lately). I think this facts are more useful than debating what will happen over next 10, 15 or 20 years from now.

I think RHB's conservative approach, GDV of RM5bil and takes 25 years, also show impressive growth, so, fundamentally it is still attractive. It is very hard to see the potential unless we know what will happen in the next few years, there were talks MRT Line 2, may be nearby DeCentrum.

However, RHB's acknowledge based on recent increase in the price of land around that area, RHB has rerated its land value.

As for trader's or short term players of this counter, hard to tell. But, one thing is for sure, their dividend is at 10sen last year, expected to increase to 12sen and 14 sen. At today's price, the DY is about 6.3% and 7.3% next year. Not too bad, collect good dividend while waiting for capital gain later. If it really drops a lot say another 20 sen (to RM1.70), if no major changes in biz, should accumulate more. Downside very limited.

Short term investors will be very frustrated with this stock if it is not moving.

2013A-2015F
MIDF
PATMI : 48m, 79m, 102m
SF: 420m, 520m, 630m (shareholders' funds)
CASH: 220m, 240m, 300m
CE : 200m, 280m, 330m
ROCE: 24%, 28%, 30% (MIDF)

RHB
PATMI: 48m, 57m, 80m
ROCE: 17%, 33%, 26% (RHB)

Actually, the return on capital employed (taking out net cash or add net debt to SF), the ROCE of Protasco is pretty solid. I believe, if they use the net cash wisely, it will bring additional earnings. With the private placement (an additional Cash of RM100m, I believe, it is used for constructions and property development - will provide a decent return of double digits). If the private placement issued at RM1.95 (or PE of 13.5x of 2013), it will definitely benefits the company. And I believe the investors that put in at RM1.95, expect a decent return from the dividend and/or capital gain.

People sell because the expectation is different. Most expect the stocks to perform almost immediately. So when, after a few weeks, their felt tire of holding (although, nothing much change in the business whatsoever). So they sell it.

Most stocks dropped too, such as Dsonic, Inari, OCK and many others, partly due to NYSE drops on last Thur and Fri. Those are with substance should not be a concern. Those who are just popular, and without substance, should reconsider.

Actually the MD's selling is insignificant. The market cap is about RM660m, the value he sold is only about 0.4% of the market cap or less than 1% of his shareholding.

He still has more than 20%. Yes, it may be worrying if he dumps a lot like >5%. Even if he does that, we have to see if the business is intact. Unless he knows something we don't. Don't forget, directors is also human being, he also has commitment and a lifestyle. What's the point of holding so much 'paper' when say at the moment you need to use the money? No point speculating his sale.

Thanks gerry188. You are so funny, fundamental value at RM1.00. LOL. You make my day.

The stocks has grown more than 10 times, is it expected another 10 times? 2 times? 3 times? in the next few years.

RHB 40m, 57m, 80m TP 2.18
MIDF 40m, 79m, 100m TP 2.90

RIDF 40m, 68m, 90m TP 2.54

RHB lower projection because they assume De Centrum's GDV RM5bil and 25 yrs (vs management RM10bil over 15 yrs)

Why the MD sell, is the same question we have been asking why MH370 went missing. Let us not be too optimistic and too conservative, lets take the middle road, RIDF (RHB & MIDF divided by 2). Still looks decent.

As far as corrections, what can we do, just buy more. If not enough funds, hold it for a a year or two. If very sure of major correction coming (for TA experts only), the wait for the major correction (>20%). TA provides the voting power (timing and popularity), FA provides the substance (the floor price or margin of safety). After all, it has RM161m CASH (RM0.50), and expected dividend yield 5-6% p.a.

Good luck.

@redwed, care to share with chart illiterates?

Unless analysts and operators catch on to this stocks like Protasco. Its like owing a Kajang ring road, knowing traffic will grow from MRT which attract new townships around the area as well as typical vehicle growth - this is quite certain. The million dollar question is when will it really move? Of course if you tell me it will only move in ONE year time, then of course, I will invest in other stocks and then come back later.

Should cut and reallocate to stocks that are more certain like Protasco and SILK. Perhaps can come back later once we have news that they are starting their projects (better still, talk update with their IR)

likely red, USA dropped 2% yesterday. Those syndicate stocks & retail hot stocks will PANIC today in the morning. Good time to nimble a little bit on good fundamental stocks if they miss it earlier. Good luck.

FA (with visibility, sustainability & growth) + TA (some say good time to buy) + Popularity (being noticed and talk about and gradually attracting analysts & fund managers) = Reasonable Gain 30%-50% within a year.

Once the results improved (almost certain), this counter will move. Just monitor their earnings from toll (25%) and also OSVs (75%). Another counter - Perdana (only OSV) market cap it RM1.2 billion with similar number of vessels. SILK is only RM300k (of course diff sizes). At this price, buy and put it in the safe deposit box for 3 years, double is not a problem.

SUSTAINABILITY
1. Government affordable housing project RM700m (3 yrs) /10% = RM23m p.a.
2. Property in Bangi (100acres) De Centrum City GDV RM10 billion (15 yrs)/ 20% RM133m p.a.
3. Road maintenance RM250m p.a. x 15 years /15% = RM35m p.a.
4. O&G guarantee profit RM70m or USD22m (4 years)/RM17.5m p.a.

MOST OPTIMISTIC VIEW (PEAK EARNINGS) = 23+133+35+17.5 = RM208.5M

Analyst TP = RM2.90 x 333m shares = mcap = RM965m
MARKET CAP today about = RM650M
DIVIDEND P.A. = RM33M (DY = 5%p.a.)

Conclusion

Analysts
With downside of DY of 5% (at RM1.95)
Capital Gain (TP) of RM2.90 = 48%

Most optimistic
Most OPTIMISTIC price PE = 12x and PAT RM200m = Market Cap = RM2.4 bio
Capital Gain = 270% = RM7.20

Conservative
Optimistic x 50% = mcap = RM1200m
Upside about RM3.60 or 90%

Worst Case
Optimistic x 30% = mcap = RM800m
Upside RM2.40 or 22%

Yes, if it fall back, the margin of safety is even larger.

Two main area of growth:

1. Acquisition of 49% of four OSVs, to complete by 2H for FYE2014 (July), bring in new earnings of say, RM4-5m

2. Increase in traffic volume about 12%, profit will increase about RM5m p.a.

3. Interest cost at the moment is high, close to 10%, increase in cash flow from disposal of vessel & higher toll collection, will save RM1-2m and conversion of the loan stock will also save some interest.

In the short run, the market is a voting machine (based on popularity if the company), and in the long run, the market is a weighing machine (based on substance of the company).

With a strong visibility and sustainability of earnings couple with growth, when we weigh it, we will realise its value is heavier than its price. Short term popularity is fun, but long term substance is more important.

Protasco has gain its popularity lately, which is great, with new shareholders, high construction order book and property development, and also O&G, lets hope its popularity continue while not losing its substance. In the long run, the substance will prevail (with or without popularity), something similar to SILK (which is not popular yet, but with substance)

In the short run, the market is a voting machine, and in the long run, the market is a weighing machine

@BabyZebraCrossing -

You are absolutely right, the first 13 days after listing, Titijaya dropped 12 days from RM1.90 to RM1.40 (dropped 26%) in Dec 2013 and today is about RM2.00

If you are right, IOIPG, the first 13 days after listing, dropped 12 days from RM3.50 to RM2.55 (dropped about 28%) in late Jan 2014 & hopefully it will goes back to RM3.50 in next few months.

Of course, this is not a good comparison, it so happen to be identical. Perhaps the recovery will take longer? Btw, this stock expected to grow from 2014 to 2016 about 30% p.a. Downside risk limited.

If Inari run up like Dsonic to PE39x, the share price is expected to be RM6.80. Another 2.5x to go. The earnings projections of Inari is very similar to Dsonic, by 2015/6 DSonic forecast RM110m, Inari forecast RM138m. The actual and estimated profit for 2013/12 and 2014/06 are close at RM82m and RM95m respectively. Lets rename it ISONIC

1. @Qii, lets put this to a test hypothetically.

2. Dsonic profit is as actual and projected, 2013-2015 = 82m, 92m and 110m (MCap = 2400m)

3. IOIPG profit of actual and projected, 2013-2015 = 560m, 740m and 1010m (MCap = 8400m)

4. Assumed both analysts are accurate, currently projected the profit up to 2015, but unable project further, 'lack of solid data to do any projections'

5. Assuming you have net worth of RM10m today and only allow to put your money in one stock to choose for above, which would you choose?

6. We know that before last Friday, the stock is about say RM24.00 (without spit or bonus), at PE of 39x like you share, do you think the retailers will buy and keep? Similarly IOIPG can split or give bonus, say, after split and bonus it is price at RM0.28, so you think it would also attract more retailers?

Another stock is very interesting is SILK. In fact this stock is safer (higher margin of safety than IOIPG) because it owns 37km of rock solid toll roads with double digit growth in traffic and rates + 21 units of OSVs with LT charter. Growth will be reasonable but certain, just monitor their toll traffic and rates increase soon. Similarly, its OSV biz is doing very decent profit margin. Currently, not popular yet. Give it a year or so, when the earnings show, it will be double.

Under the licensing act for stockbroking firm, certain senior level of the firm must have at least 30% Bumi.

1. @Fam Jenny, certain counters in the market are cornered. However, authority do not have sufficient evidences or being outsmarted. So, stock market is always a willing buyers willing seller games. No one puts a gun in your head. How do you explain those who lose millions in Transmile? and Many more. E&O, Harvest, Iris, etc. The last I know, Transmile ex-MD got away, so are many others. The list is too long to mention. So are so many cases, some got con, also don't even know, how to solve this? The market new dies, only the players and newbies.

2. Authority, like the government, for show only, bullies the weak, and protect their 'kind'. What so new about these. Happen long time ago, happen now, will happen in the future.

3. I agree, bad guys need to be punished. But, our authority always being outsmarted. Period. So, you either live with it, or, make the report, or leave the game. I doubt there are much changes to this type of problems.

1. Very much if IOIPG can prove its profit projections by analysts. Sometime, for property, timing is difficult to predict.

2. FYE 30 June 2014E = RM559m (not sure why so low, 1H already achieve RM543m).

3. FYE 30 June 2016F = RM1013 (doubled in 2 years, very impressive)

4. Not sure why HLIB valued it so low at RM3.85, growth in 2015 and 2016 is about 33% p.a.

5. Short term growth = 33% (2 yrs) LT growth, say, 8% (a quarter of 33%), using Benjamin formula it should be around RM4.32. So upside is quite good.

6. Buy slowly. Accumulate when profit shows improvements, from 2014, 559m, 739m and 1,013m. Even we use 7% growth for LT, it is worth RM3.90 (that means you assume it doubled in 10 yrs instead of analyst said doubled in 2 years.

7. Conclusion: Good upside, low downside, put it into safe deposit for 3 years and you will be happy.

1. I mean retailers like speculation and quick gains. They prefer rumours than fact. In short, they don't want to think what they buy, just hoping it goes up.

2. SILK's profit can only grow slowly. Price move too slow for punters. Hope some operators come and play this stock. Provide some excitement. After all, toll roads won't run away and 21 OSVs won't just disappear. Risk is rather low. I have not value the land they own.

if you are certain, i suggest go all out.

1. Up or down in this stock is entire up to 2 people here, Mr Bursa or Mr Syndicate.

2. Based on yesterday volume, the word 'designated' is a curse, the market lose RM700m. That proves it comes from 'Non LT Investor'

3. Mr Syndicate is the banker. Like Genting, Mr Lim is the banker.

1. What I notice lately is the retailers like to chase over something that is yet to happen (i.e. rumours) and hoping it happens like DSonic, paying huge premium of 25x for their future profit without knowing what is the Capex, Profit Margin, & Payback period of the projects.

2. Similarly, the retailers become the followers of a particular businessman, disregard what business they are in. With the exception of Focal Aim/EcoWorld, on the pretext that Tan Sri Liew, retailer also chasing over Golsta, an MGO by Tan Sri Clement Hii.

3. The fun part is they just follow blindly without knowing the upside or downside. Some said, he has done it once, so he will do it again, not worrying at all about type of business to be injected, profit margin, what is the payback period, is the industry doing well or not. Some experts, say, it follows the personality. What? Like midas touch. Of course, if they already have shown the expertise (proven) in that industry, then, perhaps you can said it is ok.

4. SILK is the opposite of retailers interest. SILK had built 37 km of roads (Kajang Ring Roads), collecting tolls, at a double digit growth and prescribe rate hike in 2015, say 50% (guaranteed by government) - analyst gives a value of about RM400m (based on NPV of DCF.

5. SILK also owns 19 OSVs, chartered with oil majors for medium and long term. SILK is buying 49% of 4 ships it already owns 51%, getting delivery another 2 ships. All with charter in hand, and margin is good. Profit from these OSVs, analyst gives a value of RM320m or profit of RM32m.

6. Why retailers like to pay 2x, 3x or 4x, or many more times (without a clue), when you have something that will definite to show growth (although slower) than something they do not know what is going to happen, like DSonic, Golsta, others. Even they get the project, surely they need CAPEX, OPEX and RESOURCES to make it happen, it it also need time, one year, two years, or many years for property development.

7. I suppose retailers, they like to SPECULATE, or GAMBLE, if that is the case, I think Genting Highland provides a better probability of winning.

Inari forward PE is about 15x. 2016F profit = 139m (June30) = mcap today = RM1bil

Dsonic, I think is close to 25x. 2015F profit = 110m (Dec 31) = mcap today = RM2.4bil

PE/PEG ratio of Inari (below 1) is lower than Dsonic (above 1)

Cautious, as I said earlier, nothing is injected in yet. Even something is injected, the Company has to pay for it. Anyway, happy trading. What did the independent adviser said on the MGO?

Should accumulate more if it drops. The FV is about RM4.40.

Really good time to accumulate. Trading at half the potential fair value.

1. FYE2014F and FYE2015F is RM79m and RM102m (2013 is RM48m). Forward PE of 2014 = 8.17 or Forward PE for 2015 is only 6.3x (very low compared with peers in construction and properties, say 10-12 x)

2. MIDF TP of RM2.90, Construction and maintenance using PE of 9x & Property using 80% of RNAV, hence, there are upside since PE used is low. Construction (55%) + Property (45%).

3. MIDF forecast profit doubled in 2 years = LT growth of 8%. Using Benjamin calculation, the FV = RM3.60

4. Conclusion - potential upside and limited downside. Not many cover this stock yet. Upside is there. Authority has not approved its warrant bonus which was announced (retailers like it).

1. CPO price at the moment has not much effect on CBIP. They only hold an associated company with about 6000ha of plantation.

2. They just started planting 6000ha in Kalimantan last year. Long way to go, at least 4 years to see any CPO produced.

3. However, due to expansion of plantations in Malaysia and Indonesia, they biz, engineering or construction of mills will benefits. They have double digits growth in this segment.

4. Their SPV is also expanding into new products and wider customer base.

5. This is not a CPO price driven stock, perhaps, 5-8 years from now, then we can see something more significant. Meanwhile, the engineering and SPV segment are growing double digits. If they can achieve a LT growth of 10%, TP should be around RM6.00

1. June 2014, forecasted RM95m by an analyst. By December 2013, 1H, they achieved RM46m. Using Estimated Earnings, the PE is about 12x.

2. The earning growth for long term say 14% (one third of short term growth by analyst), Using Benjamin formula = RM4.40

3. Using low growth of 10%, Benjamin formula is RM3.40

4. PE(2014)/ PEG = 12/14 = 0.85x or 12/10 = 1.2x (its peers are higher)

5. Conclusion: I believe there are potential, downside is limited, unless profit went south next 2 yrs.

1. One way of calculating over or under value shares is to use PE/PEG. PEG - should use growth rate for long term (10 years). This is only one of the many ways.

2. Or calculating the intrinsic value using Benjamin formula = EPS x (8.5 + (Growth)x2)). Again growth must me long term.

3. Some use forward PE and compare with peers

4. Some use NPV of future cash-flows. (more suitable for toll roads and IPPs, rather than Project based).

5. Some use EV/EBITA and compare with peers

6. P/BV vs peers (more suitable for asset based companies)

(After using these methods, surely there will be a range of price)

1. Based on HLG forecast 2016F = RM138m. FYE 2013 actual = RM42m

2. Forward PE = 9.6 x, or EV/EBITA = 6.6x

3. Forward PE of similar biz = 12 - 15x

4. FV hence is between RM3.70 to RM4.70.

5. Further good news (a) BONUS ISSUE expected (b) Upgrade to MAIN BOARD (from boy to man premium?)

1. HLG actual and forecast profits (June FYE) 2013A - 2016F = RM42m, 95m, 122m, 138m

2. Assuming HLG projection is accurate, short term (3 years) CAGR = 50% p.a. , EPS on 2016F is 29sen

3. Forward PE (based on 2016F) = 279/29 = 9.6 times (EV/EBITA = 6.6x)

4. Compare with regional and other local stocks in related biz, forward PE 12-15x., Inari price is not demanding

5. Upside is there. FV is roughly RM3.70 to RM4.70, or 30-60% upside, not bad, excluding announcement of BONUS ISSUE (the public or retail investors love it, same pie, more pieces) and upgrade to MAIN BOARD (positive move, from boy to man premium?).

Actual EPF for 2013 is RM586 billion and invested 25% in equity = RM147 billion. So EPF and Unit Trust combined invested about RM486 billion or 29% of Market Cap. That is a lot. We have not include PNB, say another RM100 - 200 bil? Not sure about that. Perhaps the market is FLUSH with liquidity.

1. In 2004, market cap is RM722 billion, and Unit Trusts' NAV is RM87 billion or 12%

2. in 2014 (Jan), market cap it RM1,662 billion and Unit Trusts' NAV is RM339 billion or 20%

3. Not including EPF, PNB, Tabung Haji, LTAT, Sovereign Funds, etc, it would be interesting to know. Today, EPF's investment in equity is about 25% of EPF total collected, say RM350bil, that means about RM85bil invested in KLCI.

4. As you know, most companies are majority controlled by owners, say the estimate floatation of shares is only 40% or RM678 billion, that means majority owns by Unit Trusts.

3. Based on research, only about 20% of Unit Trusts can outperformed KLCI. Unit Trusts charges about 6% for first time withdrawal = Unit Trust make about RM20 billion
Yearly management fee = 1.5% = They make about RM5.1 billion per year.

4. I think unit trust, as a biz, is pretty cool. In 2004, management fee is only RM1.3 billion.

5. I don't quite understand why unit holders invest in Unit Trust with a 20:80 probability of doing better than KLCI.

Earnings in 2013 RM46m, Forecast by HLIB 2016F RM139m, at today's market cap of RM1.2billion, its forward PE of only 8x. Its short term growth is 45% (3 yrs). Say, we extend the growth to 10 years, at 15% p.a., Using Benjamin formula = 0.12(8.5 + 2(15)) = RM4.70. With high ROE of 40%, I believe there is potential in this stock.

Someone need to come up with a study the following stocks which has very attractive average ROE of 40%, which seldom comes by, Preshld, Inari and DSonic. That means, say they don't pay dividend, every dollar earned, they will produce another 40%.

Assume opening of year 1 its Shareholders' fund is RM100k, and it makes 40k, by year end, its SF is RM140m. Yr 2, it continue to have ROE of 40%, meaning it will make about RM56m, to become RM196m by end of Yr 2, and Y3, it will make RM78m and shareholders's fund will be RM272m. That is a compounding rate of 40% p.a.

A compounding growth of 40% for 3 years, is equivalent to about a CAGR of 10% for 10 years. The question is that can these 3 stocks do 40% CAGR for next 3 years? DSonic FYE profit is RM82m, RHB forecast in 2015 is RM110m, CAGR 2 years of 14%. Using Benjamin formula, the

Dsonic FV is about RM4.40 (assuming 14% p.a. growth from RM82m for next 10 years).
Presbhd = RM7.00 and
Inari = RM4.40 [ all using assumption of 14% CAGR for next 10 years]

One broker forecast profit for 2015 about RM100m (substantiated by construction, property development projects). Market cap today is about RM660m. Forward PE is only 6.6x. I think upside at least 50% is there. Once it touches RM1 billion market cap, they will attract more analyst coverage and fund managers' radar, then it should command higher PE of 10-12x.

So upside is there.

Whoops, mistake, the forward PE should be about 13x if they achieve RM85m. So, it is consider high, well, they have very strong ROE, average of 40% like DSonic, OCK, Preshld.

FYE is 30 June 2013 Profits of RM42m. July to Dec 31, 2013, profits is already 45m. Assume their profits can sustain around RM20m per quarter up to June 2014, the company total profit will be RM85million. By then, the PE is only 8x. I believe the forward PE is not demanding, unless someone who is sure the profits will drop over a lot over the next two quarters.

Dsonic and Prebhd and Inari has something in common, ROE is about 40% (average last few years).

CIMB and RHB - TP is RM4.30 and RM4.50 (Forward PE of 17x). Mainly due to MOU sign for oil and gas in Johor. Until we know the growth of this stock for the next 3-5 years, it is difficult to say it is over or under valued. However, the ROE is impressive, i.e. 40%, similar to Dsonic, also has ROE about 40%. Similarly, it is covered by RHB.

1.Although my view on share split or bonus issue (slicing the same pie into smaller pieces) will not enhance the company's economic value, but the public seems to take it differently and most of the time positively. (Many years back, for any company to issue bonus issue, one of the important condition is that they have improvement in their future earnings, today, they don't need it)

2. Similarly, the public take it very positively when a company have a rights issue at a steep discount disregard whether the additional economic that the rights issue will bring, an at what price.

3. This is one of the reasons why the market is inefficient. It is more sentiment driven, i.e. irrational. But in the long run, like the second board previously, it will come back to its senses. That may takes awhile.

4. The operators come and go. Bursa should set up awards for best operators in town, at least not only they are financially rewarded, they should be recognised for their hard work.