Posted by probability > 2019-01-04 22:30 | Report Abuse

conversation style also has a lot of similarity with qqq3...

Posted by 10154899906070843 > 2019-01-04 22:39 | Report Abuse

Godhand, if growing from 300 million revebue per quarter to 900 million revenue is not a sign of a growing moat, please do describe to me a company that does exactly what QL is doing and does it better. Market leaders generally have a moat. And please don't simplify moats to just brand recognition, management performance can be a moat (Warren), size can be a moat, first adopters can be a moat.

Anyway, I'll make it easier for you. Find me an Asian company in this part of the world that competes directly just with ql lifestock farming division at 1.9 billion in revenue ( animal feed raw material production, day old chicken and broilers) and does it better than ql resources.

Go ahead. I'll pay you your research fees and eat my hat.

You would recognize a moat if it bit you in the ass(et).

Posted by Choivo Capital > 2019-01-04 22:45 | Report Abuse

Mr Long Number,

Layhong is not a value play. Not even close.

Its a punt on the NHFOOD JV being worth something, and the rest of the company being worth the share price then.

Yes the logic is tenuous, but i was feeling adventurous and in a gambling mood (this was an error of its own) not too adventurous however, as i only bought 1.9% worth. So the error had limited effect.

Cest la vie, i am human. My error resulted in 1% loss. Yours resulted in you losing your shirt.

Posted by probability > 2019-01-04 22:48 | Report Abuse

you said you had worked in boilermech? do you know how the combustion efficiency of boiler is determined? Do you know what treatments are done on the feedwater? what are the chemical parameters?

any clue?

no right...

but you are an engineer..a mechanical engineer

Posted by probability > 2019-01-04 22:56 | Report Abuse

long number is a con artist...

luring based on his success stories, position/reputation/industrial experience, large cash in his accounts, huge stakes in shares..

in which, none of the above is true...
.................................

he is probably a cheapskate as much as his dad qqq3

Posted by probability > 2019-01-04 23:03 | Report Abuse

simple ma...he has not provided a single justification for his promotion on QL...

other than the circumstantial psychological supporting factors above...
there is no one single direct logical argument to justify his opinion...

that guy is beating around the bush


Posted by i3lurker > Jan 4, 2019 11:00 PM | Report Abuse

probability

whats that to you?

he got money he wun give to you wah, why you seek to disprove him?

you gain nothing at all.

I dun bother whether people rich or poor. nothing to do with me at all.

Posted by qqq3 > 2019-01-04 23:14 | Report Abuse

probability, but its u who cannot see.... long number has put in a lot of efforts already

Posted by qqq3 > 2019-01-04 23:15 | Report Abuse

what ever it is... u don't want to buy, don't buy la.... what is it to u?

Posted by qqq3 > 2019-01-04 23:16 | Report Abuse

further it is a share EPF and PNB are proud to buy..... it is most definitely not a penny can job

Posted by 10154899906070843 > 2019-01-04 23:18 | Report Abuse

Probability, I really don't see how explaining to you what I do for my day job concerns you and investing principles at all. Other than the fact that I was part of the team doing the cpo mill in tawau, and later Indonesia, my specialty is in biomass generation and heat to electrical energy conversion. Since you seem to know Sabah so well, you can ask sistem consult and konsmal when is the next site meeting for QL plant upgrading works. But that is the most information I will give you without breaking info on who I am. But then you'd probably not know who ql m&e consultants are.

Posted by probability > 2019-01-04 23:22 | Report Abuse

ok, you are using biomass boiler steam to a turbine for creating electricity....

i know exactly your background...

but, i have some questions to you which i find puzzling why you are not enlightening others...

Posted by 10154899906070843 > Jan 4, 2019 11:18 PM | Report Abuse

Probability, I really don't see how explaining to you what I do for my day job concerns you and investing principles at all. Other than the fact that I was part of the team doing the cpo mill in tawau, and later Indonesia, my specialty is in biomass generation and heat to electrical energy conversion. Since you seem to know Sabah so well, you can ask sistem consult and konsmal when is the next site meeting for QL plant upgrading works. But that is the most information I will give you without breaking info on who I am. But then you'd probably not know who ql m&e consultants are.

Posted by Choivo Capital > 2019-01-04 23:26 | Report Abuse

Mr Long Number,

You talk alot about QL moat. Let me show your something.

Just a brief overview, since i dont have that much time.

From 2015 to 2018, Ql Revenue grew from RM2,706.91m to RM3,263.14m, that is RM556.23m or 4.68% per annum. Not even beating Malaysian or ASEAN GDP growth. They beat only SG growth rate.

Where is this massive growth your're talking about, don't make me laugh please.

You said QL is better than Berkshire, because QL can grow faster than Berkshire which has a higher base. Well, Berkshire revenue from 2015 to 2017 grew from USD210,943m to USD242,137m, that is 4.7% compounding.

And this is from a USD500 billion business base, with GDP growth rate in the US barely 2 percent pa, which is more like double the performance of the economy, in terms of revenue anyway.

So that growth point, you can go throw rubbish bin.

From 2015 to 2018, QL earning grew from RM191.40m to RM206.24m. That is RM14.84m, that is 1.88% growth in earning compounding.

I can't compare with BH here, because they have alot of revaluation gain etc, which swing a lot, If want to analyse properly, need to 10 yeas minimum.

Well, that strong growth in revenue, and weak growth in net earnings, this points to margin compression of 15.5%.

Since when company with strong moat, drop margin like that ah? And every single year the margin drops.

And as the company does not have a 90-100% dividend policy, more like 30%, this means the earnings retained is being invested at increasingly lower returns.

Now earnings grew 7.7% from March 2015 to March 2018, while the share price increased from RM2.9 to RM5, or about, 72%. Far above earnings.

Well, you must expect QL to be a perpetual machine for the next 3 years, where earning will grow another 7.7% while share price go up 72%, to 110PE!

I would be alot more impressed if earnings went up 72%, and the share price went up 100% or something.

This is not really a case of you analyzing it correctly, but more of the stupidity of others, speculating on the greater fool and pushing the price up to stupid levels.

Now since you like this company performance so much, lets do a quick analysis using last 3 year results. If QL continue to increase earnings at this pace, how much cash/earnings will QL generate over its life time?

Lets assume inflation of just 4.5% (do note bank FD rate is usually lower or equal to inflation, and its now, 4.5%, gives you an idea of how optimistic this assumption is), and the earning growth of 1.88% per annum for perpetuity, all of which were great years were nothing bad happened.

Well, is RM5.83 per share, and this is discounted using FD rate. If this is an investment, right now at RM6.7, you are saying, i will take on the risk of investing in stocks, instead of risk free FD, for a negative difference in return of roughly 0.65% per annum.

Wah seh. Your logic is flawless.

Well, call me when its RM2, i might think about it then.

Now, since you know the company so well. This company is in a cost based business. Its brand is not worth much overseas. If it was, margin wouldn't be compressed.

In a cost based business, its the lowest cost producer who wins. What is the cost of production for each KG or surimi, and how does it compare with that of global competitors, assuming the same quality?

And how does it net off if we are to taking into account shipping cost?

Cannot answer? Fine. Lets just compare to ASEAN. Do you think QL can do it cheaper than any competitor in Vietnam, Indonesia or Cambodia? Where they are working off a much lower natural cost base?

Good luck. Better don't go on margin anymore.

Posted by Choivo Capital > 2019-01-04 23:27 | Report Abuse

And to top it off, valuations for berkshire, is 3 times cheaper than QL.

This is Mr long number logic.

Please.

Posted by qqq3 > 2019-01-04 23:27 | Report Abuse

Posted by i3lurker > Jan 4, 2019 11:19 PM | Report Abuse

qqq3

EPF and KWAP has a big problem.

Their big problem is too much money. Have you calculated how much money they collect every month?
=======

at least they have some standards which are already higher and better than probability buying Hengyuan at $18........

Posted by stockraider > 2019-01-04 23:28 | Report Abuse

Probability,

In i3 forum....people come here to blow blow water....no need take it so seriously mah....!!

No need to cha kah chap....like where people work loh...!!
Just things positively mah....!!

In this case raider don side u loh...U take things too seriously loh...!!

Posted by 10154899906070843 > 2019-01-04 23:28 | Report Abuse

But just to be frank, I don't need a single justification to explain why you should buy it not buy QL. It would slightly better for me if you didn't buy, but the price of the stock would not move anyway if you did.

I'm not an analyst, I don't do but side or sell side. I don't recommend people buy my stocks.

I don't need to make money off of selling you training courses or even need anything from you.

I don't need a subscription service business, I don't even need customers.

Now I know why koon stopped posting in such a negative forum where every opinion is not too learn more but too be a troll.

I thought I would be doing new investors a favor by sharing my 20+ journey investing. Once you hit 60 you really have nothing left to prove.

This is the last time I will post a message on this ugly unmoderated forum.

I bid you a good day, probability. May your investments do you well.

Posted by probability > 2019-01-04 23:30 | Report Abuse

I am not sure if you are aware on the fundamentals of any valuation...it all has to boils down to earnings, finally the cash flow over the market cap...

so in that sense, the only way one can justify a huge PE of 60 for QL...
is if the future Earnings (eventually cash flow, when the reinvestment fraction comes lower) is expected to grow significantly...

at current PE, the Earnings needs to grow almost 400% within a short period...to justify valuation

as such, what makes you think..it can? how does the CPO mill investment is expected to generate this? or is the eggs business? as a promoter, you need to enlighten how you see the earnings coming in the ballpark figure we need to justify...

we cannot pick things out of thin air and justify

since you are confident on QL, you must have these figures at the back of your mind...

without revealing these, its pointless to discuss on QL valuation

Posted by stockraider > 2019-01-04 23:35 | Report Abuse

Don care it is a black or white cat loh....as long as it catches mice it is a good cat mah....!!

If people buy into QL and make good monies, that means his investment did well mah....!!

Posted by probability > Jan 4, 2019 11:30 PM | Report Abuse

I am not sure if you are aware on the fundamentals of any valuation...it all has to boils down to earnings, finally the cash flow over the market cap...

so in that sense, the only way one can justify a huge PE of 60 for QL...
is if the future Earnings (eventually cash flow, when the reinvestment fraction comes lower) is expected to grow significantly...

at current PE, the Earnings needs to grow almost 400% within a short period...to justify valuation

as such, what makes you think..it can? how does the CPO mill investment is expected to generate this? or is the eggs business? as a promoter, you need to enlighten how you see the earnings coming in the ballpark figure we need to justify...

we cannot pick things out of thin air and justify

since you are confident on QL, you must have these figures at the back of your mind...

without revealing these, its pointless to discuss on QL valuation

Posted by probability > 2019-01-04 23:35 |

Post removed.Why?

Posted by qqq3 > 2019-01-04 23:36 | Report Abuse

Sabah has produced a few exceptional business people before...One is CK Lau of Hap Seng....

the next is Dr Chia of QL....in that context, QL still got a lot of upside.

no need to argue with choi and the young ones...can help, help, cannot help, give up.

Posted by Choivo Capital > 2019-01-04 23:38 | Report Abuse

Haha QL will turn into magic, and turn 1.88% earning growth rate to 20% per annum clearly!

I can see myself paying 50PE for a super moat and wonderful company whose earning growing at 20% per annum.

This company on a valution basis is worth more than Tencent, Alibaba, Berkshire Hathaway, Google, Apple, Facebook, TSMC, Nividia etc.

Ecommerce, disruption, AI, automation, movement to cloud.

SO WHAT, QL WILL WIN ALL THROUGH SURIMI. Our margin will fly from 6% to 30%! We make surimi 1 sen per KG, our competitors make at RM1 per kg!

Why? Because our founder wake up at 5 o clock. No other founder in the world does that. Therefore, regardless of the economics of the business. QL will win, and be a great investment, AT ANY PRICE!

Posted by qqq3 > 2019-01-04 23:46 |

Post removed.Why?

Posted by probability > 2019-01-04 23:47 | Report Abuse

ok, Mr, Philip, sorry if myself had offended you...i am just a curious learner trying to figure out things...

may be things would have been better if right from first place only we were interacting...Jon and sslee are the culprits who made me look at you suspiciously...he he

good night

Posted by Choivo Capital > 2019-01-04 23:47 | Report Abuse

i3lurker,

I saw so much CP in singapore frozen storage.

And this co, only 13 times earning in thai stock exchange.

QL must be going to do magic trick d. Not just trick, but real magic now.

I bet next year, QL will triple revenue, and quintuple margin! That's why our genius investor long number guy willing to buy!

He so genius until can see this magic trick pls!

Posted by Choivo Capital > 2019-01-04 23:49 | Report Abuse

qqq3,

OTB is a trader, not an investor.

When he sells, you would expect most to drop after running for a bit longer.

The mark of a good investor on the other hand, is that the stock he sells, keep going up, because he trades one wonderful company, for an even better one.

Posted by probability > 2019-01-04 23:50 | Report Abuse

Jon...no need to be so offensive to others la...he probably knows something but just unable to express in numbers the way you want....

it could be that there are many hidden investments (done long ago) which are just about to start commercial operations....

Posted by qqq3 > 2019-01-04 23:54 | Report Abuse

Choivo Capital > Jan 4, 2019 11:38 PM | Report Abuse

Haha QL will turn into magic
=======

I started the conversation by saying I like QL shareholders....they can see stuffs u cannot. ...not the scared scared penny stock shareholders, and not the scared scared low PE investors.......

and they have satisfied and happy shareholders.

Posted by Choivo Capital > 2019-01-04 23:54 | Report Abuse

Haha probability.

You are right.

Having said that, looking at his replies, and how he speaks.

He is a very intelligent man, that is for sure. There is no way mine or ricky, or your points don't make sense.

But he cannot admit, because he said QL is wonderful company at this or any price publicly d, to admit fault now, would be humiliating if you have a large ego.

Posted by Choivo Capital > 2019-01-04 23:59 | Report Abuse

I think Mr long Number, will have a good performance in investment to the end of his days.

He is right, MOAT first, but valuation is a very close second. There are so many extremely overvalued wonderful business.

Our name is not WB, our capital is small, can only invest in wonderful companies selling at fair value, a little above, or below fair value. This was the most important lesson i learnt in 2018, its now engraved to my DNA d.

I doubt he is as egoistic in his investment as he is when he writes here (some of his writing, mostly his replies when people give criticism).

Good luck long number guy!

Posted by qqq3 > 2019-01-05 00:07 | Report Abuse

y i3lurker > Jan 4, 2019 11:41 PM | Report Abuse

probability

Swiss Bank Account guy was in the right place at right time and he made money
============

more than that...must also have the character, the right character, the right boxes are ticked to give him the confidence...and that is the secret recipe he is trying to share.....

but often...how does frog know how an eagle fly leh?

Posted by qqq3 > 2019-01-05 00:12 | Report Abuse

Posted by i3lurker > Jan 4, 2019 11:56 PM | Report Abuse

qqq3

Malaysian market is protected.

once open markets QL will be delisted or sold to CP for sure.
======

maybe...I don't know....how u know we need protection? I have no idea what is the import restrictions.....how much they sell eggs in Thailand?

Posted by qqq3 > 2019-01-05 00:14 | Report Abuse

I know...to young people like choi every thing is maths first.....

But I also know LiKashing do not need super maths to be superman.......

Posted by 10154899906070843 > 2019-01-05 00:25 | Report Abuse

And a final post for you Jonathan Choi, this will also be the last time I reply your post on how I value QL. As you are very smart, do tell me how many hectares of land QL has in Sabah and east kslimantan. How many more are they buying and planting. how much percentage from 2015-2018 is mature. What will be their capacity 5 years from now? Here is another hint, what was the price of cpo in December 2018? And what was the peak price during the palm oil boom? Please do your utmost calculations. I'll wait. Meantime, I'll also wait and see what boilermech is doing with their business.

While you are calculating, why don't you draw a graph between the price fluctuation of crude Brent and cpo prices from 2009-2018. I'll wait for that too. That's hint 2. What happens to CPO prices when oil becomes more expensive and palm oil becomes the cheaper substitute?

And while you are doing that, why don't I hand you the latest ctos sdn bhd report from family Mart subsidiary. How much outside capital do they need from ql to build a new FM outlet and grow revenue. How many branches do they have now? Are they on target for their promise of 500 outlets? How many outlets in Malaysia do you think they will have in 10 years? What will be the additional revenue and additional earnings gained from their franchise once that milestone is hit? Hint 3. The exact figures you might not find on ql annual reports, but you can find it from my QL explanation to Ricky yeoh how much exactly was stated in the p/l reports their revenue per outlet, cost of renovation outlay and profitability.

Now for the last hint. What part of of daily consumables is not regulated? Sugar price is fixed. Chicken and cow is fixed. Is livestock feed fixed? Oh? Who is one of the biggest producers in asean? What happens when raw material for animal feed goes up? Ask layhomg what happened. What happens to those who control their prices better?

Are you done calculating future revenue and earnings based simple mechanisms? Good. How much do you figure QL will earn from boilermech, familymart, palm oil plantations, feedstock, eggs, day old chickens and surimi 5-10 years from now? Now isn't that a lot easier to calculate and extrapolate than a lot of the fancy numbers you pulled from the air? When you have a clear picture of how the business is running? Now you do your DCF, and you net assets value, and your compounding ability.

Margin compression? Or did you think the price of oil is not a factor to manufacturing and plantation industries?

Please.

Moats for manufacturing businesses and pharmaceuticals never take a straight line growth. There are longer gestation periods, but compounded growth for a longer period of time should tell the tale between explosions.

Just because you don't see QL brand selling doesn't mean it's not everywhere. At 5 billion sales revenue ql product is probably as prevalent as Nestle. And oh yes your Milo and KitKat had vegetable oil in it aka palm oil. Guess who is on the sustainable palm oil list. Oh yes.

QL resources bhd.

I wish you good luck in your investments choivo, and I hope you do well in the future. But as I do not need to use margin and haven't for 8 years, my advise to you is the same. Don't use margin. And don't borrow money from your friends and family to fund your hobby. Get a job. Build a long term value. Read more. Explaining less.

Posted by Choivo Capital > 2019-01-05 01:18 | Report Abuse

Good luck. Im sure your smarter than than the reply above. There are so many holes, i don't even know where to start.

I hope you find your next ql, preferably something where, profit went up 300%, share price up 500%.

Not profit up 7.2%, share price up 77%.

The initial one will be much more resilient, can potentially go to 100 bagger.

The second well. you know my perspective. Good uck.

Posted by wbwanabe > 2019-01-05 01:21 | Report Abuse

Thank you Mr Long Numbers for your great insights into investment. You have found a method that works well for you and is kind enough to share them here. Even with all the negative comments, I believed such discussions are healthy & helpful for all who are learning to trade or invest in Bursa. I read Choivo’s articles too and am a great admirer of his writing. I hope you would continue to pass your investment wisdom cause nothing beats putting your hard earned money into it and living to share your wonderful story. Wish you great health and wealth 2019

Posted by Ricky Yeo > 2019-01-05 05:46 | Report Abuse

@ 10154899906070843 There is direct correlation but not necessary causation. You're right at some point performance suffer because there is too many stocks to manage. But we are talking about 28 stocks, not 1000 stocks, that's a lot of difference. And Joel Greenblatt has shown 20-30 stocks can do equally well. And to that point, magic formula by JB and deep value strategy are statistical value investing, they don't 'manage'.

Posted by Icon8888 > 2019-01-05 06:44 | Report Abuse

Mr Long's method relies a lot a lot a lot on his intellect

Not every one can do it

Not me

Posted by Icon8888 > 2019-01-05 06:47 | Report Abuse

Big MNC in Sabah ? Maybe oil and gas ?

Posted by probability > Jan 4, 2019 10:23 PM | Report Abuse

what eng and procurement of products you do? in remote sabah?

need not name the MNC but you can tell the job nature

Posted by Icon8888 > 2019-01-05 07:04 | Report Abuse

I have a different feel about you woh

You are good at making statements about things , most of the time negative

Apart from that I don't see you make much contribution to investing ideas

Posted by 3iii > 2019-01-05 07:14 |

Post removed.Why?

Posted by 3iii > 2019-01-05 07:31 |

Post removed.Why?

Posted by 3iii > 2019-01-05 07:37 | Report Abuse

THE BEST STOCK INVESTMENT STRATEGY

Keep it simple. Keep it safe (make money with less risk taking). You don't need to pick the best stock or even the best stock funds to do well, if you have an investment strategy that keeps you out of trouble.

Posted by 3iii > 2019-01-05 07:52 | Report Abuse

The thread shared a personal journey in his investing. For that, we can be thankful.

This one thread is worth all the noises in this forum to date. It is a path a young investor can hope to emulate.

Of course, investing is simple, but not easy.

After many years of interacting with some personalities in various forum, I find many have poor strategies in their investing. Accordingly, their results likewise.

I think the writer of this thread just wished to share his journey.

Posted by 3iii > 2019-01-05 08:09 |

Post removed.Why?

Posted by Choivo Capital > 2019-01-05 08:44 | Report Abuse

Mr phillip,

Regardless of our differences, i hope you stick around and continue to comment.

Your perspective is a breath of fresh air, and i believe your presence to be a net positive to those around.

If a newbie read your postings, he would have saved a lot of money. I think i would have made a few mistakes less if i read this article in 2016. The "any price" portion of your philosphy, i would have naturally removed.

I hope you reconsider. Very few here have a brain for investing as sharp as yours, and even fewer with the length of experience that you have.

Posted by Matcha Green Tea > 2019-01-05 08:47 | Report Abuse

This is an interesting read, Thank You Mr Number for sharing your thoughts, you are very thoughtful for the investment community. You do not promote and need not but you just showed examples of what you did back in the days.

All best wishes to you in your life and you should enjoy your efforts well.

Posted by Choivo Capital > 2019-01-05 08:58 | Report Abuse

No arguments there.

Posted by Icon8888 > 2019-01-05 09:01 | Report Abuse

QL earnings grew from 125 mil in 2009 to 250 mil in 2018

A growth of 100% over 9 years

But market cap expanded by 400% (according to yahoo chart, it went up from 1.6 to current 6.7)

Value creation for shareholders not so much by earnings improvement but more on PE multiple expansion

Same thing happen to TOP glove , vitrox, prestariang (before collapse) JobStreet

Posted by Icon8888 > 2019-01-05 09:08 | Report Abuse

Long term hold of companies with moat not the only way to make it in bursa

I have busy reading lately. John Neff , Joel Greenblatt, Seth Klarman (margin of safety) , David dreman etc all Chuen their portfolio every few years (some even happy to let go after few months when profitable)

So it is not true that moat based Buffett style super Long term investing is the only way to do it

Don't believe me ? Read their books

Posted by Ricky Yeo > 2019-01-05 09:14 | Report Abuse

Inside view is important. How much each business from core farming to FM or palm plantation can potentially grow and generate profit are important.

Equally important is the outside view. Growth require investment; investment depends on cash flow generated from existing assets. So how much each of this business can grow is tied to 2 things:

1. Amount of capital reinvestment allocated (after dividend & maintenance capex)
2. The industry dynamic determine return of per dollar investment

If QL has a capital reinvestment of 100 mil after paying dividend and maint. capex, that sum gets allocated over many businesses QL have i.e FM, core biz, plantation. Then how much can QL get for that 100 mil is the aggregate ROC for those individual business.

If 20 mil goes into plantation, for simple modeling, we ignore gestation period and look at normalized return, return where business is running smoothly, you would expect a 2-3 mil in earnings or 10-15% ROC. Because even the best run KLK don't earn long-term ROC above 15%.

If 50 mil goes in FamilyMart, we do the same, how much per store, or aggregate ROC of all opened stores, using 7-11 and FamilyMart Japan as a guidance. You do it for other business QL own as well.

All these comes to an aggregate ROC how much that 100 mil investment can generate in order to fuel the top line growth of the QL group. If one assume aggregate ROC of 20%, then 20 mil will flow into the top line the next year; on subsequent year, QL will have 120 mil allocation, @ 20% ROC that's another 24 mil which flow back to top line again and so on. You started to get a vague picture how much revenue and earnings can grow and what will they be 5-10 years.

****

I have no qualm that picking quality companies is a great strategy; but I also respect people who choose other strategies. Intelligent investing is about managing risk, so if one wants to buy poor companies, arbitrage, there's nothing wrong, they just have to manage their risk through diversification, margin of safety etc just as buying quality require it's own way of managing risk i.e not overpay, illusion of understanding etc.