Posted by kcchongnz > 2013-08-13 13:11 | Report Abuse

What is the intrinsic value of Tien Wah (13/8/13)

Financial theory postulated by John Burr Williams in his “The theory of investment value” says that the value of a stock is worth all of the future cash flows expected to be generated by the firm, discounted by an appropriate risk-adjusted rate. This theory has since been extensively used in contemporary finance.

There are two major assumptions used in the computation for the intrinsic value, or the present value, of the expected future cash flows of a company; earnings growth rate and the discount rate. Slight deviations of the assumptions can yield a vast difference in the intrinsic value.

The discount rate is related to what is the required return by the equity and debt holders respectively; i.e. how much risk premium above the risk-free rate would be required. For most practical purpose, in contrast with the academic approach in capital asset pricing model, a risk premium applied is related to how stable the earnings and cash flow of the company and its financial health. The 10-year MGS rate at the moment is about 4%. As Tien Wah has a quality business as described by me previously, it would be conservative to apply a risk premium of 6% above the MGS rate, or a required return of 10% (4%+6%). Using a before-tax borrowing rate of 7%, it weighted average cost of capital is about 8.9%. This WACC will be used as the discount rate for the valuation of the firm.

The more difficult part is the assumption of future cash flows of the company which is related to its expected growth rate. A difference in assumption of growth of just 5% will yield a completely different intrinsic value of the company. Hence when I carry out the computation of IV to decide whether to invest in a company, I would prefer to use conservative assumptions. In Tien Wah’s case, how about the assumption that its business will be stagnant, and there is no further growth?

Appended below is the valuation of Tien Wah with the data and assumptions as shown.

Revenue 000 408081
Ebit 46813
less income tax -6788
EBIT after tax 40025
Add average D&A 13234
Less average capex -17645
Normalized Ebit 35614
WACC, R 8.9%
Growth rate, g 0.0%
Enterprise value=Ad Ebit/(R-g) 402035
Add cash 35527
Other investments 14962
Less debts -73905
EPV 378619
Less minority interest -123849
EPV to common shareholders 254770
Number of shares 96495
EPV/share 2.64

MOS 5%


So using EPV, the intrinsic value of Tien Wah is RM2.64 per share. Hence there is hardly any margin of safety investing in Tien Wah at the present price of RM2.51, is there? So why bother?

The EPV above assumes that there is no more growth of the business of Tien Wah for the rest of its economic life (re-emphasized). Do you believe this conservative assumption? What about the growth of the Malaysian economy? What about inflation which will also raise prices and hence growth in accordance with GDP or inflation?

Let say Tien Wah’s business will grow at a rate even lower than the rate of inflation at 3% forever. The enterprise value of Tien Wah will increase from 402m to 608m.

Enterprise value=adj ebit/(R-g), where g is the growth rate forever.
With this EV, and after adjusting excess cash, debts, minority interest etc, the intrinsic value of Tien Wah is RM4.08, or a margin of safety of 38% if you invest in Tien Wah at the present price of RM2.51.

The following table shows a scenario analysis on the growth rate and the corresponding intrinsic value of Tien Wah.
Table 1: Scenario analysis of intrinsic value and growth rate
Growth rate 0% 1% 2% 4% 5%
IV 2.64 3.00 3.46 4.95 6.27

For example if one assumes Tien Wah’s earnings will grow by 5% for the rest of its economic life, its intrinsic value is RM6.27. If you think there is no more growth, then the IV is RM2.64. So which growth rate is the right one?

Posted by inwest88 > 2013-08-13 14:30 | Report Abuse

Very detailed explanation. Thanks kc. One question - it is assumed that the potential IV of RM6.27 is based on a growth rate of 5% but there is no indication of the length of this period. Based on my simulation, if the growth rate is proportional to it's share price, it will take about 18 years to reach the IV of 6.27. Am I correct (or wrong) to say this. Kindly advise.

Posted by gloomberg > 2013-08-23 00:11 | Report Abuse

I've just read through the annual report, and honestly speaking despite the slightly above par performance matrices, I don't see any catalyst for this company, on top of the HUGE customer concentration risk of BAT, come on, it's around 60 to 65% of their revenue. The discount rate ought to be adjusted higher to account for that.

Posted by kcchongnz > 2013-08-23 06:15 | Report Abuse

Posted by gloomberg > Aug 23, 2013 12:11 AM | Report Abuse
I've just read through the annual report, and honestly speaking despite the slightly above par performance matrices, I don't see any catalyst for this company, on top of the HUGE customer concentration risk of BAT, come on, it's around 60 to 65% of their revenue. The discount rate ought to be adjusted higher to account for that.

Good observations and good comments. Kind of agree with you. But on the other hand having a solid mountain to lean on could be an advantage for some people.

But seriously, Tien Wah is good in its printing business and i believe they have a niche and can work well with any client.

Posted by gloomberg > 2013-08-23 09:48 | Report Abuse

Looking deeper into its business, yoy, australian cigarette biz went downhill due to the plain packaging law that came into effect last year and was contemplated the year before, so I suppose BAT in Australia has jumped the gun and reduced the demand for cigarette cartons in anticipation. There are no analyst coverage so I supposed not many are aware of this.

Nevertheless, I believe there would be a high switching cost for BAT Australia if they were to switch supplier and the risk of quality compromised (I think it's common when we switch supplier who doesn't have the capability and capacity to cope with quality and demand). These remains to be seen. Contract will end in 2018 just a few more years to go.

On the Malaysian front, I believe that their capabilities are unparalleled as you don't get any packaging like the one Dunhill has (resealable package), I'm not sure if it's patented, will need to be clarified.

For this sort of industry, as long as population grows and developing countries upgrades themselves to wanting better quality/branding, TWP would stand steady. The barriers to entry seems low, but when I look deeper, they have continuously improve quality, reduced complaints and upgraded technology, that itself is a barrier to entry on top of hiring experienced management, look at their chairman.

For a stock with that kinda market cap, I'm surprised to see the high level of transparency they have in their annual report, much higher level than many other peers (ok maybe I need to see more). I see that their management would strive to do more. Just one more point, I don't see any ESOS for their top level ppl, correct me if I'm wrong. That's a better way to align interest.

Posted by bsngpg > 2013-08-23 12:32 | Report Abuse

Hi Gloomberg : I like your way of doing homework very much. Please keep on. Do you perform the same on other counters such as KFima, JTiasa, Mahsing, Huayang, SP Setia, Notion, GTronic, Zhulian, HaiO, CIMB, MBSB etc ? If yes and if you do not mind, please post it as I believe I can benefit a lot from your homework and I would like to exchange my little view too. Thank you very much.

Posted by kcchongnz > 2013-08-23 16:44 | Report Abuse

do you need a "catalyst"?

Posted by gloomberg > Aug 23, 2013 12:11 AM | Report Abuse
I've just read through the annual report, and honestly speaking despite the slightly above par performance matrices, I don't see any catalyst for this company, on top of the HUGE customer concentration risk of BAT, come on, it's around 60 to 65% of their revenue. The discount rate ought to be adjusted higher to account for that.


The Perversion of the Investment Catalyst

Most stock articles you read always include some sort of upcoming catalyst that is going to propel the stock higher. But to only invest in stocks with clear catalysts defeats the purpose of value investing.

Catalysts are not important, nor is it required for an investment.

Take it from the man who defined value investing, Ben Graham. He just wanted one thing and spent his days searching for it.
Cheap stocks.

Warren Buffett also wants to buy one thing.
Awesome companies.

Neither mentioned anything in any of their writings about seeking a catalyst to make a successful investment. In fact, they told you the opposite.
Sit and wait they said.

The problem is that sitting and waiting is torture today. There has to be action. There has to be fast moves up and if something doesn’t play out within a few months, it’s a dud and not worth keeping any longer. “Next!”

Investors today lack assiduity. That’s Charlie Munger’s technical term for sitting on your ass and doing nothing.

If you must seek a catalyst, remember that being cheap itself is a catalyst. That’s the number one catalyst which always gets ignored because it’s so simple and boring.

Let Mr Market do his thing and waltz around with Miss Price in his arms. You don’t have to join his dance or gaze longingly at Miss Stock Price. They are a pure vanity couple. Great looking and fun to be with but horrible to live with.

Having a catalyst is good, but is it necessary?

No.

You make money by waiting.
Monish Pabrai

This post was first published at old school value.

Posted by gloomberg > 2013-08-23 17:16 | Report Abuse

I'm looking more on twp's upside vs downside, there seems to be more downside. What do u think?

Posted by kcchongnz > 2013-08-24 09:58 | Report Abuse

The author has given his reasons for including this stock in his portfolio. He even provided an intrinsic value of the stock using the earnings power valuation method. So if you have any different view, he is very happy to hear your side of the story. Please shoot.

Posted by haikeyila > 2013-11-06 18:17 | Report Abuse

Top-class analysis on a top-class counter. Bravo.

Posted by KC Loh > 2013-11-06 18:30 | Report Abuse

i, for one, will try to look for other catalysts if there are! truth be told, i am leaning a little bit towards Michael Price's methodology in this impatient world! :)

Posted by kakashi > 2013-11-06 18:46 | Report Abuse

Dear guys, really thank you for the fruitful discussion. it really benefits any viewers who read your analysis. Keep it up and thanks again

Posted by kcchongnz > 2013-11-06 18:47 | Report Abuse

First time heard about Michael Price (MP). Yeah there are so many things one doesn't know. Thanks the other KC for highlighting it.

Just goggle and found this about MP.

Investment Philosophy

Steak and sizzle approach
Steak is what you are buying: earnings stream, asset values, cash, real estate, etc.
Sizzle are new things where there is nothing there today, e.g. VOIP, new movies, etc.
Figure out the steak and ignore the sizzle.
Look for inflexion points where there are problems, earnings disappointment, litigation, bankruptcies, etc.
Compute the intrinsic value of a company/asset and buy it when people are selling it at a big discount, 30-50%.
You are in this environment now, bull market, cheap money, lots of M&A activity, where it is very hard to find cheap stocks. So what do you do? You wait.


Seems like similar philosophy as those great value investors; focus on the performance and value of the company concerned rather than things one can't predict and has no control of. Just that his value may be different from others:

"He doesn’t believe in computing intrinsic value by discount a stream of future earnings, or measures like price/book or multiples of EBITDA. You have to go when there are transactions."

I am not sure what he means by this in stock investing:

"You have to go when there are transactions"

KC Loh, can elaborate? Thanks first.

Posted by KC Loh > 2013-11-06 20:53 | Report Abuse

Price's so-called transactions are basically the catalysts that is mentioned. He goes in big when there are...er.... "blips" to the price against the value. He believes there are blips happening all the time and take advantages of that on a fast and furious pace, even though he is a value investor in his approach. Of course, he can do that because he has over 200 analysts working for him when he was in charge of Mutual Fund.

Posted by KC Loh > 2013-11-06 20:56 | Report Abuse

some of Price's catalysts are : company break-ups, M&A, lawsuits, takeovers, ROE, ROIC, products call backs, etc. He sees business first with balance sheet as the yardstick

Posted by haikeyila > 2013-11-11 15:32 | Report Abuse

Fundamentals remain intact. Dip in earnings due to slower demand and forex losses, which could prove temporary.

Posted by haikeyila > 2013-11-11 15:53 | Report Abuse

q1: go check the fundamentals
q2: is there any assurance you wont hit by a truck tomorrow?

Posted by haikeyila > 2013-11-12 09:39 | Report Abuse

ask a million more questions, squeeze your balls tight and watch the counter cross RM3 and pay special dividends.

Posted by haikeyila > 2013-11-12 10:27 | Report Abuse

holding strong in the face of a storm. while blue chips are being tossed around like houses in tacloban.

Posted by iafx > 2013-11-12 10:52 | Report Abuse

r u q'ing at 2.52 at the moment? :D :D :D

Posted by cpng > 2013-11-12 11:10 | Report Abuse

Debt ratio decreasing quarterly..

2013-3Q > 0.27
2013-2Q > 0.32
2013-1Q > 0.42
2012 > 0.43
2011 > 0.51
2010 > 0.68

PER ratio around 8

Good or bad ??

Posted by cpng > 2013-11-12 11:19 | Report Abuse

Dividend yield 6+%

Maybe their market cap is around 240M..

below 500M/1B so not meet the fund invest requirement

out of radar of market players.

Let us can accumulating slowly...

Posted by iafx > 2013-11-14 09:08 | Report Abuse

tienwah overall ok but debt high

Posted by kcchongnz > 2013-11-14 09:26 | Report Abuse

Posted by Robert Love > Nov 14, 2013 09:00 AM | Report Abuse
why are all the people so bullish about Tien Wah suddenly becoming so quiet?

Feeling dejected when nobody gives a damn to your apa ini New Toyo? Ok lah let me cheer you up by responding to the questions you were dying of getting a response.

Posted by Robert Love > Nov 11, 2013 03:40 PM | Report Abuse
how do we know that fundamentals have remained intact? is there any assurance that BAT will renew contract with Tien Wah when the current one expires in Dec 2015 (only 2 yrs away)?

I DON’T KNOW SERIOUSLY, BUT DO YOU? HOW DO YOU KNOW IT WON’T BE RENEWED? AND HOW DO YOU KNOW THERE WILL BE NEW AND MORE WORK FOR TIEN WAH? YOU GOT SIX SENSE AH?

Posted by Robert Love > Nov 11, 2013 07:43 PM | Report Abuse
Based on the latest KLSE announcement , armed forces have further pared down their holdings of Tien wah by a further 1.6 million shares . If Tien Wah is so good , why did armed forces sell off Tien Wah ?

I THOUGHT YOU ARE SAYING WARREN BUFFET, PETER LYNCH, JOEL GREENBLATT OR OTHER GREAT VALUE INVESTORS DISPOSING TIEN WAH.

Posted by Robert Love > Nov 12, 2013 09:21 AM | Report Abuse
If Tien Wah does not get the renewal from BAT, how then does we do DCF valuation when there is no cashflow ?

SO DO YOU KNOW IF THERE IS A RENEWAL OR NOT? WHY ARE YOU SO SURE THAT THERE WON’T BE ANY MORE CONTRACT FROM BATS OR WHOEVER FOR TIEN WAH?
SO HOW DO YOU DO YOUR VALUATION THEN? PLEASE TELL US.

Posted by Robert Love > Nov 12, 2013 10:01 AM | Report Abuse
impossible to cross even 2.60RM. Its revenue was dropping in last 2 to 3 quarters. It will drop below 2.50 RM in no time. It has dropped back to 2.54RM this morning..haha

LOOKING AT THE THREE QUARTERS RESULT, EPS WAS 24 SEN PER SHARE COMPARED TO THE PREVIOUS THREE QUARTERS. SO IS IT BAD? OR YOU PREFER TO LOOK AT QUARTER BY QUARTER WITHOUT TAKING INTO CONSIDERATIONS THAT THERE MAY BE SEASONALITY INVOLEVED IN EARNINGS?

Posted by Robert Love > Nov 13, 2013 04:16 PM | Report Abuse
Tien Wah dropping below 2.50 RM soon, probably would drop back to 2.30 - 2.40 RM level. Not sustainable at current level when revenue and profit are levelling off...

WOW, ANOTHER PETER THE OCTOPUSS.
GO AHEAD AND KEEP ON CHANTING ON YOUR NEW TOYO.

Posted by cpng > 2013-11-14 09:41 | Report Abuse

We are finding undervalue counter to invest especially those above 6% div yield.
Price weakness is a good for us ...more attractive ..

Posted by kcchongnz > 2013-11-16 10:00 | Report Abuse

Do you know most public companies borrow money to do business? That is what the debt market is for. Why don't they get most of their money from the shareholders?

Cost of debts is much cheaper than cost of equity. For me to invest in a public listed company, I would require a minimum return of 10%, whereas cost of debt is half or less that that. So if I am the finance director of a firm, I will distribute most of the excess cash as special dividend, and when I need money for the business, I borrow from banks.

Tien Wah's dividend unsustainable? What is your basis of your statement?

Company pay dividends generally through the free cash flow of the business. Free cash flow (FCF) is obtained by taking out some from the cash flow from operations each year for capital expenses such as buy new plant and equipment, upgrade production assets etc. From the FCF which is left over after capital expenses, company can distribute out as dividends, pay down loan, or invest in other ventures. That is exactly what Tien Wah's management did all these years.

So why dividend is unsustainable? Is there no adequate FCF each year to pay dividend? Find out first before you make wild statement like that, just to promote your New Toyo.

What is this New Toyo? I would be interested to know if you can provide us with your analysis and valuation, and tell us why it is so attractive, not just make simplistic statement like that.

Posted by haikeyila > 2013-11-16 12:27 | Report Abuse

there are not many companies in Bursa as resilient and consistent as TWah. It has shown a steady increase of 135% in the last five years. Sure the price has dipped a tiny bit last week due to general market sentiments, but thats what the stock market is all about. You dont have to buy if you aint got nuf balls.

Posted by kcchongnz > 2013-11-16 13:08 | Report Abuse

Oh I see. You are so excited that New Toyo is going to pay 2.28 sen special dividend. So much so that you have to keep on telling people to spend 32 sen to buy New Toyo. So what is so special about this "special dividend"? Wont the value of the company, and hence value to the shareholders, decrease by the same amount after the payoff?

In the process, you keep on talking not-so-good things about Tien Wah; things like profit dropping lah, dividend not sustainable lah, contract with BAT may not be renewed lah, debt lah etc.

But do you actually realize that in the article you appended, it mentions mostly about Tien Wah, which New Toya has a substantial stake; that New Toyo depends earnings and cash flow from Tien Wah. In fact other companies and divisions in New Toyo do not make money at all etc? In essence, Tien Wah is the savior of New Toyo.

So if Tien Wah is bad according to you, where does this lead New Toyo to? Holland?

Posted by haikeyila > 2013-11-18 10:47 | Report Abuse

someone prefers the old mother to the buxom daughter.

Posted by nokenzo > 2013-11-18 11:55 | Report Abuse

Up to Q3, TWP has FCF of 38m. Come 26.02.2014, the FCF should match at least 2011 FCF. TQ kcchongnz.

Posted by Robert Love > 2013-11-21 15:29 | Report Abuse

Let's be rational about Tien Wah.

1. How big is the printing market (tobacco and non-tobacco sectors) in Asia Pacific and how much is Tien Wah's share of the market?

2. Smoking rates and legal volume for cigarette volumes has decreased and will continue to decrease in Malaysia and Australia, 2 of the 4 exclusive printing zones in the contract with BAT. How is Tien Wah going to expand its market share when the sector itself is shrinking? Tien Wah did not reveal its printing volumes in its financial statements. Even at constant revenue, the cost of products has gone up due to inflation. Hence, the real printing volume decrease would have been much greater. Is Tien Wah venturing into new markets to mitigate the printing volume drop in Malaysia and Australia?

3. The Australian dollar will continue to drop over the next few years. This will also translate into lower earnings for Tien Wah for its operations in Anzpac.

4. With the advent of e-cigarette, the traditional cigarette volume is going to decrease even more rapidly. Hence, the demand for conventional printing will drop as well. How is Tien Wah going to deal with this?

Quite unlikely for Tien Wah's share price to move up from here when its revenue and profit are already stagnating or declining rite?

tks.

Posted by Robert Love > 2013-11-21 16:09 | Report Abuse

Given the above outlook, Tien Wah should retreat back to below its NAV, probably 2.2 to 2.3 RM range. this is more sustainable price range.

Posted by Robert Love > 2013-11-21 17:21 | Report Abuse

0915 GMT [Dow Jones] UBS notes that the RBA sold a net A$0.33 billion during October, a figure which its analysts call "highly unusual", pointing out that unbalanced activity on this scale hasn't been seen for four years. The RBA regularly acts as agent for the Australian government in the FX market, selling just enough Australian dollars to meet Canberra's foreign currency needs. In October, though, the RBA bought significantly more foreign currency than the government needed, and was a net seller of Australian dollars to do so, UBS points out. The RBA has repeatedly expressed a preference for a weaker currency to help rebalance the domestic economy away from mining. But the Fed's perceived delay in tapering QE3 has helped keep AUD/USD aloft. "This latest evidence now suggests that the RBA's patience may be running out, and that the central bank may have finally begun to lean against the wind - albeit very gently." AUD/USD trades around 0.9274 after printing a two-month low of 0.9258 earlier.

Posted by Robert Love > 2013-11-21 20:09 | Report Abuse

http://www.nst.com.my/nation/general/rm2b-in-taxes-lost-to-illicit-cigarettes-font-color-red-exclusive-font-1.365906?cache=03%2F7.157305%2F7.261895%2F7.266429%2F7.266429%2F7.268476%2F7.283795%2F7.283795%3Fkey%3DMalaysia%2F7.454177%2F7.454177%2F7.454177%2F7.502513%2F7.502513%2F7.502513%2F7.502513

Posted by Robert Love > 2013-11-21 20:10 | Report Abuse

http://www.examiner.com.au/story/1896824/tax-increases-could-stop-250000-smoking/?cs=12

Posted by Robert Love > 2013-11-22 10:47 | Report Abuse

Tien Wah has dropped back below 2.50. More downside is possible from here...

Posted by cpng > 2013-11-22 11:03 | Report Abuse

Robert want to talk down Tienwah....
Upside or downside...I also happy..

If down I can accumulate cheap...
If up I will riding on the current...

Posted by Robert Love > 2013-11-22 11:04 | Report Abuse

The thing about New Toyo better than Tien Wah is that it has its own specialty paper segment which has picked up strongly with the new contract with PMI, the biggest tobacco player in the world.

If you noticed that although New Toyo only owns 54% of Tien Wah equity, it has more than 70% of Tien Wah's group profit. This is because of the JV called MEIL, which allows New Toyo to cream off profits. MEIL is a money spinner for New Toyo.

Tien Wah's master is New Toyo. This is the truth.

Posted by Robert Love > 2013-11-22 16:38 | Report Abuse

it is not about talking down Tien Wah. it is about presenting facts on Tien Wah. It is naive to think that one single person can "talk down" a counter? this must be the best joke of the year...

Posted by Robert Love > 2013-11-22 16:45 | Report Abuse

Who are the other "top printers" in Malaysia? What is Tien Wah's share of the markets? What is Tien Wah's competitive advantage over other printers?

Posted by houseofordos > 2013-11-22 18:53 | Report Abuse

Mr Robert Love, I see you are talking a lot of negatives about TienWah but mostly your comments are qualitative, can you share some quantitative analysis in terms of numbers like P/E, EV/EBIT/, ROIC, DCF analysis that shows Tien Wah is so overvalued ?

Posted by Robert Love > 2013-11-23 09:02 | Report Abuse

A good comparator for Tien Wah is Amvig (listed in Hong Kong).

a. Amvig gross profit margin is the region of 30% while that for Tien Wah is barely 20%.

b. Amvig is constantly undertaking printing capacity expansion for future growth while Tien Wah has already stopped installing new capacity since 2011. This is because demand for Tien Wah’s printing has already stagnated while Amvig is still growing its market share in China.

c. With much better GPM than Tien Wah, Amvig’s P/E is only 8. Should Tien Wah trade above this P/E level? I think not likely. If I am investor, I would rather buy Amvig than Tien Wah. Amcor has a big stake in Amvig but sold off its stake in Tien Wah many years ago.

All these info can be founded at Amvig’s website below.
http://www.amvig.com/eng/ir/highlight.htm
http://www.amvig.com/eng/ir/report.asp

Posted by ipomember > 2013-11-23 09:36 | Report Abuse

fair judgement robert love, good point indeed.

Posted by bsngpg > 2013-11-23 10:14 | Report Abuse

Robert Love has presented a very good case. I were once invested in TienWah(2009 -2011, 31000 shares). Yes, I received good dividend but it was very boring indeed due to more or less the same cases/points presented by Robert Love. Thus at last I decided to let go TienWah in 2011.

I liked its Annual Report,CEO(Tengku) and management.

Posted by sephiroth > 2013-11-23 10:18 | Report Abuse

only one big player LTAT

http://www.bursamalaysia.com/market/listed-companies/company-announcements#/?category=SH&sub_category=all&alphabetical=All&company=7374

Posted by DLuckyGuy > 2013-11-23 10:25 | Report Abuse

I am newbie. Don't know much and learning about it. I made 45% profit from my first and only stock. Am I genius? Definitely no. Am I lucky? Yes. I came across a statement that said, "In bull market, everyone is a genius." Will I made profit if I invested during 2009 to 2011? Only in bear market, we can discover the real deal.

Posted by bsngpg > 2013-11-23 10:39 | Report Abuse

DLuckyGuy : As you can admit that you are not genius but lucky, you are qualified to join Bursa, you have bright chance to win in long term.

You will very likely make good profit if you invested in 2009-2011 and hold till today, but it does not mean blindly with any investment. Example I have invested big money in Notion in 2010, till today I made a big lost among my portfollio, not to mention profit.

You need to select carefully and with luck.

Welcome to Bursa. Good luck.

Posted by DLuckyGuy > 2013-11-23 10:49 | Report Abuse

Thank you, bsngpg

Posted by Robert Love > 2013-11-23 10:58 | Report Abuse

Tien Wah "WAS" attractive had one bought it below 2.0 RM but not now. The valuation is quite rich. this is my humble view. There are much better counters out there.

Posted by tsurukame > 2013-11-23 11:16 | Report Abuse

I am not an investor of Tien Wah but this thread somehow piqued my interest...kcchonnz had done terrific work on determining the intrinsic value of Tienwah based on reported figures and most of i3 participants here would have learnt if they had taken the effort to do so...

The intrinsic value approach relies on past reported financial figures...of course if one knows the biz very well and can see its future biz very well ... one can use DCF( on FCF) basis to arrive at NPV of the business and that is assuming that past success factors will guarantee future success...but this may not be true in every case though.

I do not know anything about Tien Wah but I heard that they had opened up a factory in Vietnam...what will its future biz be in Vietnam??
Moreover AMVIG is doing well in China but then again CHINA is comprise of so many provinces where each province is very large in land mass and each province is actually a "country" bigger than other small countries outside China . So what is the biz potential of AMVIG going forward.....Doing biz in China is rather complicated...one can be successful in one area but a disaster in another as Past success factor DOES NOT GUARANTEE FUTURE SUCCESS...