Posted by Tang Michael > 2014-03-06 11:01 | Report Abuse

Mudajaya is one lousy and dying slowly counter.......from nearly 4.00 rm to 2.70rm today.....it wont go beyond 2.80 ......too many sellers waiting...just see.....

Posted by plumberii > 2014-03-06 11:04 | Report Abuse

Interesting, informative and clear analysis. Will study Mudajaya and then see whether to open my wallet. Ha.

Cheerio.

Posted by sense maker > 2014-03-06 11:38 | Report Abuse

The missing part in Mudajaya's story is dividend. Without dividend, it is unlikely to move up in a sustainable way.

Posted by Ricky Kiat > 2014-03-06 12:36 | Report Abuse

Agree on u good analysis.

Posted by Ricky Kiat > 2014-03-06 12:41 | Report Abuse

keep on good analysis & sharing, u are second i follow after Mr Koon blog.

Posted by johnny cash > 2014-03-06 13:25 | Report Abuse

who says no dividend in mudajaya??? there is

Posted by sense maker > 2014-03-06 21:39 | Report Abuse

Sorry, I overlooked the small dividend they pay. I always like high dividend with few exceptions, of course.

Mudajaya has not been a rewarding counter in the past 10 years or so. It is intersting to see if its Indian story starts to bear fruit at last.

Posted by johnny cash > 2014-03-06 23:51 | Report Abuse

i notice in the past mostly lembaga tabung haji will buy this counter.. but at rare times.. i think more instituitional investors like epf and others should come in.. then also i notice when this counter is dropping say for example no good earning report,,it will be well supported by BUY BACK from mudajaya.. this is the reason Mr koon, did mention that this counter cannot go much down

Posted by Alphabeta > 2014-03-09 17:28 | Report Abuse

Forex exposure of a company can be unrealized gain/(loss):

a> Invested in a foreign country and having an investment costs to be translated into home currency. This give rise to unrealized forex gain/(loss), which is the gain for Mudajaya. It will be a realized gain/(loss) upon disposal of the investment.

b> Secured a loan in foreign currency, in this case, there will be a valuation forex gain/(loss) before the loan is due for repayment. This is also an unrealized gain/(loss)till expiry of the loan.

Those forex exposure that required hedging is the transaction gain/(loss), for example if Mudajaya needs to pay China equipment supplier in USD in 3 months time. They can buy forward the USD-INR exchange rate now before it is due for payment.

When company allocate capital (shareholder fund + borrowings)to invest in business. As an investor, we need to know the key drivers for profit, the quality of its assets, use of trade credit and equity multiplier effect.

If management cannot find suitable investment target for its excess fund, it should be pay back to shareholder in the form of dividends. Investing in a foreign associate with huge cost overrun, high interest rate, and risk of forex translation (though not critical) will definitely have a drag of future return on equity. The net investment cost in its Indian associate is RM 630 mil (RM 862 – 225 unrealized forex loss – RM 7 mil pre-acq loss) and form 38% of the total assets value. Whether the ROE can match the current 25% ROE is questionable (RM 862 x 25% = RM 215 million per annum). Moreover, its cost of investment of its 26% associates is still climbing.

Another area of concerned is its receivables in FYE 31/12/12 comprised of RM 128 mil of contra properties. Instead of getting paid with cash, its customers pay in kind. The contra value of these properties (did not disclose the type of properties) may deteriorate upon disposal.

Up till FYE 31/12/12, it has been using internal fund for its investment but this scenario has changed in its 31/12/13 quarter. It has pick up a total borrowings of RM 27 million. With lower order book and fast disappearing cash pile. It will need to borrow more in future to finance working capital and any future capex requirement.

Posted by Alphabeta > 2014-03-09 17:33 | Report Abuse

Based on its balance sheet strength in last quarter ended 31/12/13, it still can pick up RM 500 million debt with ease.

Posted by Icon8888 > 2014-03-11 09:40 | Report Abuse

alphabeta what is your view ? buy or no buy leh ?

Posted by Alphabeta > 2014-03-11 22:19 | Report Abuse

In Malaysia, 3 sectors with growth prospect are Oil & Gas, Construction and Plantation. It is a matter of which stock has the high potential. I has place my bet on the Oil & Gas (Coastal Contract - previously recommended by Mr Koon) and Plantation (IJM Plantation) and i am looking for a niche player in the construction sector and Mudajaya fit the bill. I will buy in small quantities first and accumulate more on weakness. Mudajaya should perform better once it secured big ticket local job.

Posted by Alphabeta > 2014-03-11 22:29 | Report Abuse

With India General election coming soon, nothing will move within a year if there is a change in government. The present coalition government headed by Congress already there for two terms, chances of a change is very real.

Posted by Icon8888 > 2014-03-11 23:17 | Report Abuse

But if he choose girl friend like that, susah loh

Cannot too fat cannot too skinny. Cannot too fair cannot too dark. Good education background. Good character. Pretty. Kind. Intelligent. Wah Lao eh

Posted by Icon8888 > 2014-03-11 23:18 | Report Abuse

Sometime agak agak can jump in already lah.

Posted by Alphabeta > 2014-03-12 09:04 | Report Abuse

Agreed with you, however the average P/E of Malaysia market is already above 17, very close the historical height of 18. Mudajaya has not been moving in a big way.

Recently i am taking some risk investing in HS H Share ETF 2828 at HK 95. It is an ETF fund listed in HK with P/E slight above 7, it give dividend yield of around 2.6% with potential upside. I think the Chinese government have the financial muscle and the intention to fixed and reform the economy. Even Goldman Sachs also commented and pick HK ETF as undervalue investment. I also notice quite a number of local unit trust fund with oversea exposure pick this up as part of their investment portfolio.

Like you said, not possible to find the perfect girl and has to rely 30% on gut feeling. Having said that, we have to be careful not to place everything in one go if you are in doubt. Unlike Mr Koon, who is the Ultra-High-Net-Worth-Individual, he can take more risk.

Posted by Icon8888 > 2014-03-12 09:39 | Report Abuse

HK.... No time to study yet.... Boleh land alone keeping me busy..

Posted by johnny cash > 2014-03-13 23:53 |

Post removed.Why?

Posted by johnny cash > 2014-03-14 14:04 | Report Abuse

http://klse.i3investor.com/blogs/valueinvestorresearchklse/48343.jsp

Posted by 3iii > 2019-01-22 12:21 | Report Abuse

http://www.corporateinformation.com/ImageSvr/Chart.ashx?T=SS&C=C458JZ400

Posted by Integrity. Intelligent. Industrious. 3iii (iiinvestsmart) > 2019-12-28 12:56 | Report Abuse

>>>>

To cut the story short, I dont mind taking some position, patiently wait for three years for 50% to 70% potential capital gain

>>>>>


On March 2014, this stock was RM 2.70 per share.

Today it is 40 sen per share!

Posted by abang_misai > 2019-12-28 13:13 | Report Abuse

During construction boom, Mudajaya can’t perform. Now in the doom time for construction industry. Completion is stiff. Some secured the jobs at slim margin. Worst there are others who are willing to do it at loss.

Boleh kah Mudajaya? I hope I’m wrong.