Posted by goreng_goreng > 2016-02-17 17:29 | Report Abuse

omg dude, how much effort you put to produce this kind of superb and detail article? even my brain takes 1 week to digest everything. really appreciate your sharing dude guy.

Posted by duitKWSPkita > 2016-02-17 17:32 | Report Abuse

Geng. Quality write up

Posted by james_owk > 2016-02-17 17:42 | Report Abuse

Goob job dude. Impressive write up. Keep it up!

Posted by tftey > 2016-02-17 17:54 | Report Abuse

Good Quality Report

Posted by Pakcik Saham > 2016-02-17 19:23 | Report Abuse

cephasyu.. good writing & canone is my favorite stock IV 6.10

Posted by Kylo_Ren > 2016-02-17 19:34 | Report Abuse

good write up. But the Offer Price for Kian Joo still remains at RM3.30.

Posted by soros228 > 2016-02-17 20:38 | Report Abuse

Good

Posted by soojinhou > 2016-02-17 20:46 | Report Abuse

I must say that your write up is not only informative but hilarious as well. Thank u for an entertaining read. All eyes on Toyota Tsusho now whether they will throw in their hat to bid for kianjoo. The deadline to watch is 31st March.

Posted by connie > 2016-02-17 20:57 | Report Abuse

DUDE, why u so good at analyzing ONE ??? CAN joke also ... we NO WORRY ONE with DUDE around :) thanks so much for sharing dude .. sincerely, dudess

Posted by siradrian > 2016-02-17 21:00 | Report Abuse

You're good. Splendid write-up with jolly good jokes. I must say your style shadows that of Dali...heads down. Keep it up!!!

Posted by lching > 2016-02-17 21:17 | Report Abuse

a good write up however if Toyota doesnt make an counter offer, the price wont move to the price you culculate.

Posted by cephasyu > 2016-02-17 23:23 | Report Abuse

Thanks for the great encouragement guys (and dudess)!

Kylo, thanks for the comment! The offer price for KJ hasn't been revised. However first of all this article argues that Canone is worth RM5.72 regardless of the sale of KJ. Secondly, due to the delay, Aspire will resubmit the draft circular for acquisition of KJ by 31 Mar 2016 (if there is no further extension). They will not announce a revised offer price until they release the circular. Finally, I thought the way you killed your father was a little cliche (heck but that's just my opinion)

lching, thanks for your opinion too. The revised Toyota offer is used for the calculation of the RM7.08 TP. I'm not using that TP as it is too optimistic. Also, I'm sorry, perhaps I have not been sufficiently clear that I am using the Aspire/TTC as a proxy for value and the acquisition does not need to materialise for the value to be realised. KJ is making healthy profits as we speak.

Posted by PureBULL . > 2016-02-18 07:03 | Report Abuse

Dear cephasyu or dude in short,
I give u a BIG Like U.
U certainly have all the qualities n talent of super sales stock broker Jordan in the movie, The Wolf Of Wall Street.
Many stocks in KLSE r in need of the driver with your kind of charming personality in presenting the FA #s.

I encourage everybody to watch the infamous film, fully sponsored by our govman, THE WOLF OF WALL STREET.
Seriously, it's a good show for people who want to know what is behind how stocks go up.
Lots of F--- every where in words n in action. They do that action even in the glass lift. Best of all LOTS of PUSSY r shown every minute.

U get to see how Jordan charmingly promoted n road showed Steve Madden as the greatest shoe maker n designer for ladies.

cephasyu or Dude, Never say NO. U can be constantly on cloud 9 like Jordan in high living.

Posted by Bullhunter > 2016-02-18 09:18 | Report Abuse

Good writeup cephasyu. Thanks a lot.

Posted by dusti > 2016-02-18 09:35 | Report Abuse

Hi Dude. Good job. How soon are we hitting the jackpot?

Posted by Kylo_Ren > 2016-02-18 11:12 | Report Abuse

Hi cephasyu, like your sense of humor.
Can-One investors are still in a good position whether the sale is materialized or not since Kian Joo is running a profitable business.
Definitely a plus if the Offer Price is revised upward or Toyota makes a formal bid through IB.

Posted by 360Capitalist > 2016-02-18 11:19 | Report Abuse

Dude, a great write up.. better than professional analyst. Salute

Posted by Icon8888 > 2016-02-18 13:26 | Report Abuse

Like !!!

Posted by RosmahMansur > 2016-02-18 17:35 | Report Abuse

good write up. I enjoyed reading this article. TQ

Posted by cephasyu > 2016-02-19 16:02 | Report Abuse

nice, I got a like from si fu Icon! :P
Thanks for all the supportive comments, 360capitalist, rosmah (haha!), bull hunter and even pure bull (dude, are you high?)

Dusti, as much as I am confident in Can-one, I do agree that the Aspire deal can be a strong catalyst. The deadline for that is 31 March 2016. However KJ has extended this deadline 4 times and there is no assurance that they won't extend it again.

Posted by projecti2016 > 2016-02-19 22:13 | Report Abuse

Good write up. I absorbed your information well. Gives me more confidence in canone

Posted by Vijayy > 2016-02-20 08:20 | Report Abuse

Cephasyu, excellent writeup and comprehensive analysis! Thanks for sharing ur great analysis. I have been following ur series...waitin for the next episode!
btw, hope you can share where can i obtain the historical PE chart? Did you compute it manually by mapping the historical share price chart with the historal EPS or is there a place i can download such info for free? Thanks

Posted by cephasyu > 2016-02-20 19:44 | Report Abuse

Thanks for the encouraging comments, projecti and Vijayy. Thanks for following my series haha. Hopefully I'll Be able to write sufficiently frequent unlike the Sherlock Holmes series.

Unfortunately I manually made all my historical PE charts. I couldn't find any free ones online

Posted by natyrag > 2016-02-22 13:11 | Report Abuse

Dude, love your writing style and the detailed, well researched, well reasoned analysis. For me you are one of the few writers on i3 worth reading. Thanks for sharing. Cheers

Posted by duitKWSPkita > 2016-02-22 14:10 | Report Abuse

read and re-read...

I am going to nominate the write Mr.cephasyu for Best M&A Analysts in 2017 Malaysia i3 AWARDS next year

Posted by cephasyu > 2016-02-22 21:12 | Report Abuse

natyrag, thanks man. That means a lot.
Duit, I wish there was such an award haha. In any case, thanks for re-reading

Posted by cephasyu > 2016-02-23 18:27 | Report Abuse

If anyone's still reading here, Dlady's results just came out. Gross margin is up but net profit is down. Gross margin improved from 34.6% to 42%, due to low milk prices.

Net profit is down because of high advertisement and promotional activities. (management tends to lump more expenses in healthy quarters to cushion the impact)

My point is that milk counters are still benefiting from low raw material prices and Can-one is one of them.

Posted by investmentisgood > 2016-02-23 20:44 | Report Abuse

Hi cephasyu dude, thanks for your write up. I have just viewed the qr of kianjoo, one thing i am not very understand is the foreign exchange gain and loss. Can you please explain more to me? does this foreign exchange refer to the exchange rate between myr and usd? and how you calculate gain or loss? thanks alot

Posted by cephasyu > 2016-02-23 23:29 | Report Abuse

hey investmentisgood. That's a good question. I was looking at KJ's overall Q it and pondering as well.
I'm concerned about overall declining margins, and high op expenses.
The MYR vs USD and MYR vs VND both were relatively stable from Oct 1 to 31 Dec 15, so I'm a little preplexed with the forex losses as well. I can only imagine that they did not mark 2 market their obligations in the last Q and are only doing so this Q. Although I can't be certain.

Sorry, I don't have a good answer myself

Posted by yewyin33 > 2016-03-01 05:27 | Report Abuse

Cephasyu, I must congratulate you for writing such an interesting article on CanOne. After having seen hundreds of articles on share investment, I consider this article is the best. I believe this article would have encouraged many readers to buy this share and are losing money. CanOne’s 4th quarter result which was announced last evening is affected by the lower profit contribution from Kian Joo.

As you know, the prices of really good shares with excellent profit growth like FLB, ChinWell, VS etc are also falling. I think Dr Mahathir's resignation from UMNO has a big damaging effect on the stock market. I would think many investors including foreign fund managers are selling. Don’t worry, CanOne is one of my larger holdings.

I wish to know you, Cephasyu. My email address is: yewyin33@gmail.com and my name is Koon Yew Yin

Posted by cephasyu > 2016-03-01 13:47 | Report Abuse

Ho lee sheet! Here I am expecting people to stone me for assigning such a TP to Can-one and it's result tanked. Instead I get KYY lavishing me with such praise! (although he did mention that I caused people to lose money)

Nevertheless for those who are still reading, I apologize that I was not able to foresee these latest results. I have not reached the level where I am able to accurately predict earnings. As well thought out as my article was, the results were still disappointing. Kian Joo definitely played a role in the disappointing results, and Can-one's milk division only registered a PBT of RM10m vs an average of RM17mil for the previous 3 quarters.

I suspect this could be due to higher raw material cost - commodities quoted in USD and weaker sales from strong competition - F&N / Johortin (Jtin is undergoing an expansion). However I am still puzzled as F&N has registered stronger profits from low milk commodity prices and Dutch lady registered stronger gross margins.

Therein lies the weakness of Canone & Johortin - the lack of brand strength. F&N and Dutch lady can sell directly to the customer, giving them the ability maintain prices. OEMs like Johotin and Can-one has to fight on price if there is an oversupply, eroding margins. At least this is what I hypothesize for now.

Posted by Jim Tan > 2016-03-01 13:58 | Report Abuse

cephasyu

very good article, hope you can write more often =)

Posted by investmentisgood > 2016-03-01 18:59 | Report Abuse

Hi cephasyu dude, it is me again. I have noticed that in CANONE's previous QRs result, they attributed the profit from the milk division to the stronger USD. Does it mean that they do sell milk products to USA?
Furthermore, I guess the higher raw material cost they have is because they have hedged too early? way too earlier than the drop of the commodities? that's why the pricing drop is still not reflected in the recent qr?
Ya, don't give up dude, it is always good to learn something from the downs. I am still trying to figure out the reasons causing the lower profit.

Posted by soojinhou > 2016-03-01 19:08 | Report Abuse

I don't get it too. While rm has weakened, so has raw milk price.

Posted by cephasyu > 2016-03-02 18:05 | Report Abuse

Hey Jim, thanks for the kind comment.

Investmentisgood, usually all exports/imports are quoted in USD. It does not mean that they export to the US specifically. They have mentioned that they export, however, in the past two Q, they recognized forex loss due to stronger USD and a derivative hedging gain. This means that they suffer from stronger USD.

Also based on 2014's annual report, they have RM120m of USD receivables out of a total of RM260m receivables. This means that they are exporting approx 46% of their products in USD. But still suffering from strong USD. Why? @_@

Unfortunately, there are no raw material deriative instruments, only forex instruments. It is possible that they purchased earlier when raw mat was more expensive, but looking at inventory days of 60, they couldn't have bought when it was very expensive.

I am still guessing that it's due to lower selling prices from competition but it's only a hypothesis.

Thanks for the encouragement man, let's not give up!

Posted by YiStock > 2016-03-07 17:28 | Report Abuse

Check on net exposure, perhaps can find the clue there

Posted by Mat Cendana > 2016-03-14 13:27 | Report Abuse

Now that Canone has suddenly 'meletup', I'll bet this post will see a lot of readers. Thanks for the analysis and opinions. You may or may not be correct. But I'm very appreciative of this kind of effort. Thumbs up!

Posted by cephasyu > 2016-03-14 13:33 | Report Abuse

Thanks Mat Cendana! Please check out the updated article!

Posted by Insider_Says > 2017-06-05 22:51 | Report Abuse

The analysis & article was fantastic, though I become pening pening after reading half way. One of the best!