Posted by kk123 > 2014-03-02 18:44 | Report Abuse

Growth, low gearing , PE , cashflow , dividend & the business model, transparency & the management

Posted by pilindo > 2014-03-02 20:02 | Report Abuse

I think i want to buy Kulim and Jaya tiasa. Good prospect in the future. but now im still holding Inari and insas and perstim.

Posted by pilindo > 2014-03-02 20:06 | Report Abuse

What do you think about Inari and insas uncle Koon. I invested a lot in this shares. I have no cable in Inari. Hopefully my investment doing well, and i can go back to Malaysia and do business.

Posted by TheTerminator > 2014-03-02 21:09 | Report Abuse

I can identify few bright future counters which will increase revenue in new few years such as Brahims, Mudajya, LBS and SKpetro.

Posted by AyamTua > 2014-03-02 22:02 | Report Abuse

NTPM, Hexza and AHB (cousins of Ecofirs and Mercury) kokokkookkk

Posted by Koon Yew Yin > 2014-03-02 22:57 | Report Abuse

Ayam Tua, I cannot understand why you bought Hexza. In 2003 its eps was 2.2 sens and in 2013 its eps was also 2.2 sens. Its average eps in the last 10 years is about 4 sens. As a result the highest price in the last 10 years was 72 sens. Why are you still keeping it.

If I am not mistaken, you recommended Hexza before.

Posted by destiney > 2014-03-02 23:09 | Report Abuse

padini div yield 6%+
paying divvy every quarter..earnings also increasing every quarter...

Posted by chaihuat > 2014-03-02 23:27 | Report Abuse

Mbsb. Profits on the up trench last 5 years and is expected to increase in future

Posted by Icon8888 > 2014-03-03 00:07 | Report Abuse

Profit growth, profit growth is the key

Posted by Icon8888 > 2014-03-03 00:23 | Report Abuse

Right ?

Posted by johnny cash > 2014-03-03 00:23 | Report Abuse

heavy investment in mudajaya since many years ago when it was trading at 1.50. .. should i still hold on it? now thinking want to go in BRAHIMS and DSONIC, but worried on dsonic because already went high

Posted by johnny cash > 2014-03-03 00:29 | Report Abuse

how about MITRA n ANCOM, is it a hidden gem? MITRA eps good, but not moving, why why n why..is it waiting for big boys to come

Posted by Koon Yew Yin > 2014-03-03 05:02 | Report Abuse

Johnny cash, when you said that you have bought Mudajaya at Rm 1.50, it means that you bought it about 4 years ago as shown on its price chart. Since then the price went up and it has been trading at an average price of about Rm 2.70. If you did not sell and took profit, you should not sell now. Please look at my previous article namely "Mudajaya's Wild Card"

As I said at my opening statement, I am not a professional and it not possible for me to know so many shares to be able to give advice or express an opinion. Nevertheless, I must tell you that you have to look at each of your holdings to see if they have the essential quality of good profit growth. That is the lesson of this article.

I have a quick look at Mitrajaya and Ancom, I have to tell you that both of them do not have the quality of good profit growth prospect. Mitra's eps was 10.9 sen in 2011 and 4.6 in 2012 and unless you are sure that 2013's profit is better, the share price will not go up.

Ancon's eps lost money every year in the last 3 years. Why did you buy it?

Posted by houseofordos > 2014-03-03 08:01 | Report Abuse

Mr Koon, well written articles and sharing. You said you owned some MFCB. Know that you are an expert in terms of power plants. I also own some MFCB, what do you think about MFCB ? What are its prospects for growth considering that some of its concessions are expiring soon ?

Posted by Icon8888 > 2014-03-03 08:05 | Report Abuse

Uncle koon I agree with you profit growth is most important factor.

Essentially it comprises two steps (1) identify a stock that has potential to register quantum leap in earnings in few years time, thereby propelling valuation to a totally different level decisively, and (2) ask yourself the question "how realistic is my expectation of earnings growth ? Namely, how high is the probability that the earnings will indeed go to that higher level in few years time ? (Earnings visibility). What are the key drivers ? How resilient it is ? Can it survive the test of time to reach that higher profit level ?"

Getting the above two correct will help to make $ in the market loh (so far this is also my real life experience)

Posted by Icon8888 > 2014-03-03 08:15 | Report Abuse

Visibility for Super Earnings (VSE) varies from one case to another. For jtiasa is the tree maturing, for my pet project Ivory it is the 45% stake in the RM10billion GDV sea fronting Penang World City property project， for mudajaya it is a completed power plant waiting to be fired up, for puncak niaga 10 years ago it was the water treatment plant under construction and will start supplying water in 12 months time (backed by government offtake), for oil and gas stocks in 2011 was petronas announcement in that year it was going to spend RM350billion capex over the next five years.... Many other examples...

Posted by Icon8888 > 2014-03-03 08:19 | Report Abuse

When a stock's Visibility for Super Earnings is good, you don't need to target super high percentage gain. Even if according to calculation, it will only propel earnings (and hence valuation) up by 40%, it is worth your efforts to pledge your underwear to the pawn shop to take position (nowadays they use margin).

It is good profit with minimum risk.

Posted by Icon8888 > 2014-03-03 08:30 | Report Abuse

Identifying a stock with future Super Earnings potential is like smelling aroma of fantastic cooking coming out of somewhere when you walk down the street. You can't see it, but you know it is there. You know it is yummy but cannot actually tell how it looked like and how it ultimately taste

Posted by Icon8888 > 2014-03-03 08:37 | Report Abuse

Ah I better stop writing, baby crying....

Posted by Koon Yew Yin > 2014-03-03 09:46 | Report Abuse

Icon8888, thank you for your intelligent comment. Yes, the whole process is to look ahead and anticipate good profit growth. When you sure buy it before the whole story is clear to the public, before the price is rerated. Let me quote what you said 'Essentially it comprises two steps (1) identify a stock that has potential to register quantum leap in earnings in few years time, thereby propelling valuation to a totally different level decisively, and (2) ask yourself the question "how realistic is my expectation of earnings growth ? Namely, how high is the probability that the earnings will indeed go to that higher level in few years time ? (Earnings visibility). What are the key drivers ? How resilient it is ? Can it survive the test of time to reach that higher profit level ?"

Getting the above two correct will help to make $ in the market loh (so far this is also my real life experience)

Posted by Fong Kim Shui > 2014-03-03 09:48 | Report Abuse

Hi， can anyone out there advise is Evergreen a good counter to invest ？

Posted by Koon Yew Yin > 2014-03-03 10:03 | Report Abuse

I used to own a small amount of Evergreen a few years ago. When the company lost its profit growth potential, I sold all my holdings. I have not been following its progress.

You do not need to ask someone to advise you. All you need to do is the read my article carefully and understand what I said.

Posted by Gen2 > 2014-03-03 10:27 | Report Abuse

Dear Mr.Koon, by far this is the most valuable article I read and learned among all other's you been wrote. Thanks !

Posted by Icon8888 > 2014-03-03 11:23 | Report Abuse

when come to investing, nothing beats hardwork. You must constantly read read and read. The more you read, the more opportunities you uncover.

Read articles, forum discussions, quarterly results, analysts reports, listen to gossips, etc...

then pick the stock that you expect can deliver strong profit growth

that is how it worked for me.

Posted by Icon8888 > 2014-03-03 11:27 | Report Abuse

uncle Koon, one of the stock that I made a lot of money is actually one of your "descendent".

I bought IJM Land when I got wind of their The Light project in Penang. That time the stock was trading a arounf RM1.00

Posted by Icon8888 > 2014-03-03 11:39 | Report Abuse

one of the bonus feature of s superstock with good earning growth potential is NO ANALYST COVERS THE STOCK.

Because when the company started producing the earnings that you envisioned, analysts started covering them. Affin analysts initiated coverage, 100 investors take position. CIMB analysts initiated coverage, another 100 investors take position. HLIB analysts initiated coverage, another 100 investors take position. RHB analysts initiated coverage, another 100 investors take position. TA analysts initiated coverage, another 100 investors take position.

By the time UOB initiated coverage, the early bird has offloaded his enitre position and walked into the sunset

Posted by Koon Yew Yin > 2014-03-03 12:07 | Report Abuse

Icon8888, I know you are quite different from other commentators because you not only understand my writing, you take the trouble to explain what I tried to say.

The whole point is to find companies that can make increasingly more profit this year and in the next few years. Of course there is some risk that the chosen company may not make so much of profit, but if you buy them when ordinary investors including fund managers do not want them, your risk of losing money is minimum.

For example, I am slowly collecting Kulim when all ordinary investors and fund managers are selling in view of its poor result. It is on cheap sale!!The reasons why I am buying are:

1. I expect all plantation companies will make much more profit this year than last year and will continue to make increasing more profit in the next few years because of the CPO price uptrend which is sustainable.

2. Kulim small lost due to accounting policy is like a little scratch. Don't let that worry you. As I said before, fear is often the biggest obstacle to success.

3 Kulim is one of the largest plantation companies. It has sold all its other non core businesses and is concentrating on the most profitable plantation business. Remember its palms continue to produce more fruits and its large land bank continues to appreciate in value while its share price cannot continue to sell on cheap sale.

4. This reminds me when the cop price was going up to over Rm 4,000 per ton Kulim share price was coming down in 2007/8. I bought Kulim warrant at 50 sens. I was the largest holder. I sold all my warrants when it went over Rm 10.00. Although it sounds so boastful, my remisier in TA Securities, Ipoh can vouch for it.

Hope you understand the lesson better with Kulim as an example.

Posted by Icon8888 > 2014-03-03 12:19 | Report Abuse

Ok I will take a look at kulim

Posted by Icon8888 > 2014-03-03 12:25 | Report Abuse

Uncle koon, I will do a thorough analysis of kulim (provided there is sufficient publicly available information, including age profile, etc) and give my view on the stock.

But just to pre empt you, I will be independent. If I concur with your recommendation, I will say so. Otherwise I will make an opposite recommendation

Thank you and enjoy your lunch

Posted by 3happy > 2014-03-03 12:32 | Report Abuse

Uncle Koon - Can you comment on the Tiong Nam Logistics? Thank you

Posted by Koon Yew Yin > 2014-03-03 12:36 | Report Abuse

3happy, please read my article carefully and apply the knowledge to check on the stock Tiong Nam. Why did you buy it? Does it have the most important quality of making increasing more profit?

Posted by AyamTua > 2014-03-03 12:40 | Report Abuse

Posted by Koon Yew Yin > Mar 2, 2014 10:57 PM | Report Abuse

Ayam Tua, I cannot understand why you bought Hexza. In 2003 its eps was 2.2 sens and in 2013 its eps was also 2.2 sens. Its average eps in the last 10 years is about 4 sens. As a result the highest price in the last 10 years was 72 sens. Why are you still keeping it.

If I am not mistaken, you recommended Hexza before.

---

Uncle...

Conclusions
Hexza qualifies as Graham net net investment strategy with a wide margin of safety. It can also stand on its own as a value investment stock as a going concern with the high dividend yield investing strategy.

Link: http://klse.i3investor.com/blogs/stock_pick_challenge_2013_2h/40677.jsp

Posted by AyamTua > 2014-03-03 12:41 | Report Abuse

Uncle Koon - chip in a bit lah into NTPM, HEXZA and AHB if can.. kikikiki hahaaaaa

Posted by Icon8888 > 2014-03-03 14:02 | Report Abuse

uncle koon, i scrolled down Kulim's annual report for 2012 and my mouse stopped at page 81 (to be more specific, the 3 pie charts at the bottom).

I have no further comments on Kulim

have a nice day

Posted by aliyusof > 2014-03-03 14:14 | Report Abuse

Uncle Koon, i always buy based on good dividend per share track record (only profit making can allow this over a period of times) and a healthy balance sheet (low gearing and good net current asset). Are these good enough? Anything to look at? Thanks, Sifu.

Posted by johnny cash > 2014-03-03 14:26 | Report Abuse

dear Mr Koon-- thank you very much for the reply. no i am not in ancon and mitrajaya.. ok mudajaya i will hold it, according to your advise. but when it start s rocketing up please be arround to guide us on selling.. end of march the first powerplant fires, but i does not know when a strong rerating will start taking place.. i think strong rerating might be given by CIMB. are the analyst going to rerate the stock after firing all of the 4 powerplants, or just after the first powerplant.. i read a old report of CIMB, title SHOW ME THE POWER

Posted by Fung Chee Fui > 2014-03-03 14:44 | Report Abuse

Thanks Mr Koon. I have been following your writings in other mediums for awhile but did not aware that you have been actively blogging here. Glad that I finally found it and I look forward to more teachings from you in the future.

Posted by Fung Chee Fui > 2014-03-03 14:56 | Report Abuse

Very good points written Mr Koon. I agree that knowing the company well is by far the most essential factor of thriving in investing. On top of that, I also think that knowing the personality, risk-taking level and the capital allocation skills of the management is equally important. While we -- the small investors -- have no privilege to meet the management team, I think we are still able to evaluate the CEO-&-co by analyzing the business decisions made in the past, such as taking borrowings, making sensible acquisitions, buying back shares when it is cheap, developing new products/ services, managing the profit margin, etc etc etc.

If a management team is honest, capable and long-term oriented, paying 15x P/E for the stocks may still seem sensible.

Posted by johnny cash > 2014-03-03 15:28 | Report Abuse

http://www.thestar.com.my/Business/Business-News/2014/03/03/Construction-outfit-tipped-to-be-prime-beneficiary-from-RM11bil-power-plant-job/ on MUDAJAYA

Posted by Koon Yew Yin > 2014-03-03 15:30 | Report Abuse

Icon8888, please write to me koonyewyin@gmail.com about your finding in Kulim 2012 annual report. I wish to know your opinion.

Ayam Tua, after I said that Hexza's eps was 2 sens in 2003 and 2 sens in 2013 and the average eps for the last 10 years is about 4 sens, you still said that it complies with Benjamin Graham's fundamental criteria in share selection. If you have kept it in the last 10 years how much is your profit? There is no share price appreciation and the dividend can hardly cover interest charges and inflation. I trust Ayam Tua know what to do for himself.

Posted by metalmonk > 2014-03-03 16:12 | Report Abuse

Mr Koon, for Kulim, the potential for it's growth, in profit surge was due to its New zealand plantations (NBPOL) in 2012. Main reason NBPOL is making less profit due to higher cost of sales. The loss in early 2013 can be attributed to forex, where USD-PGK exchange rate has resulted in losses of USD 14.2 million for NBPOL as well.

do you still think there are potential growth with external challenges from NBPOL?

Posted by thumxj > 2014-03-03 16:20 | Report Abuse

From the news posted by johnny cash, it pointed out that "Wong said the first unit would be commissioned by the third quarter of this year, and the other three units to be commissioned in stages soon after."
Does it refer to year 2013 or 2014? Is that a copy paste from old news in 2013 or it is a fresh interview with COO James Wong?

Posted by Icon8888 > 2014-03-03 16:26 | Report Abuse

uncle koon, I think I better discuss here. Discussing it through emails might make others suspect that there is something fishy about kulim, which is not the case

actually no big secret. It is about the age profile.

in line with the spirit of this thread about looking for growth drivers to propel valuation to higher level decisively, my immediate focus is on the group "4 to 8 years" (Age 1 to 3 years are too young to have a big impact over next two to three years on FFB production, which is my investment horizon. Age > 9 years are prime already and hence unlikely to contribute to FFB spike also).

Accroding to back of envelope calculation, the age group "4 to 8 years" accounts for 24% of planted area. It is still a good profile, but not the kind of super driver that we discussed in this thread (on the other hand, compared to Kulim, jtiasa's maturity profile is much more conducive for FFB spike. But that is a different story, to be discussed at difference forum)

having said all these things, the question is whether Kulim is a Buy at this stage ? My answer is that it is not a bad idea, as I am pretty comfortable with the notion that CPO will be strong for at least two years (I could be wrong). Rising tide lifts all boats, so unlikely your investment in Kulim is going to turn sour in a big way. For a big player like you, a 10% capital gain will produce so much profit that you can eat KFC everyday for the next twenty years (KFC is a luxury for small people like me)

so why not ?

Posted by Koon Yew Yin > 2014-03-03 16:29 | Report Abuse

thumxj, please look at Business Time on Mudajaya which I just posted

Posted by Fung Chee Fui > 2014-03-03 16:33 | Report Abuse

Icon8888, Mr Koon's comment prompted me to read your comments and they are brilliant. Thanks for sharing your knowledge.

On top of your suggestion to look at stocks that not covered by analyst, I also believe that it is very sensible to look into stocks that are not yet invested by the institutional investors like EPF or mutual funds. Chances are there if we can spot it before the institutions, and when they do, the P/E will expand accordingly on top of the earnings growth, if any.

Posted by metalmonk > 2014-03-03 16:35 | Report Abuse

Icon8888, what then you think about their Newzealand business for Kulim. I prefer definately Jtiasa, but not still convinced because i can't really find out where the higher sales cost incur on NBPOL.

Posted by Koon Yew Yin > 2014-03-03 16:36 | Report Abuse

Icon8888, thank you for your opinion on Kulim.

Posted by Icon8888 > 2014-03-03 16:40 | Report Abuse

thanks FCF. I considered myself very lucky. Somehow, from Day 1 i started investing, I have been buying and selling shares based on the concept we discussed in this thread. I dont know why I behaved in such a way. I just feel VERY comfortable about it.

this discussion of kulim brought back fond memory as Kulim was the FIRST srock I ever invested. I borrowed RM1,400 from my brother in 1998 (at the tail end of financial crisis) and bought 2,000 shares at 70 sen. Within few weeks Kulim went up to RM1.10. I sold the shares and treated myself KFC. Nice

Posted by Icon8888 > 2014-03-03 16:46 | Report Abuse

uncle koon, since you are active in this forum (can see you are having a great time here), may I suggest that you write an article abut your experience during the Asian Financial Crisis in 1997 / 1998 ?

I was lucky I havnt invested in stockmarket when the crisis happened, but I witnessed the disastrous effect it had on my friends, relatives, collaeuges and even the kopitiam near my house. The Asian Fianncial Crisis left an indelible mark on me mentally. Until now I am still haunted by the prospects of sometning like that happening again.

It would be nice if we can hear your story

Posted by Icon8888 > 2014-03-03 16:48 | Report Abuse

metalmonk, not new zealand lah. despite its anglo saxon name, New Britian is a small island off the coast of Papua New Guinea. Sorry I dont have further details on NBPOL