Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-01 07:45 | Report Abuse

Part 2 to come up next week due to some overseas commitments currently.

Posted by teoct > 2019-07-01 11:00 | Report Abuse

Philip, thanks for sharing. Some dates (when bought) would help appreciate the returns better.

Have a good week ahead.

Posted by titus > 2019-07-01 13:04 | Report Abuse

Hi Philip, if not mistaken, you have PCHEM previously. Have you sold it off?

Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-01 14:05 | Report Abuse

No it is in part 2, as part 1 is all my own stocks where I am 100% owner, pchem and stne are joint ownership with friends and family. I should be able to post it up today.

Posted by GrahamNewman > 2019-07-01 14:47 | Report Abuse

Hi Philip, it was only today that I discovered there are indeed someone who are truly rational and intelligent in the local investing scene. I have been a user of this forum for the past 1 year and all I have seen are speculators.

I consider myself a greenhorn in the investing scene, starting only exactly 1 year ago, where i formed my own partnership with my family, so far the results have been average, about 14% return annually. I am admittedly in the Buffett-Munger camp in terms of investing philosophy, where I try to find the proverbial 50 cents(or less) for a dollar, the qualifying dollar being derived from earning power as oppose to hard assets.

Before I start putting my dollars into the market, I did some serious readings on the Buffett-Munger style of investment, some notable ones includes:

1. The legendary Securities Analysis 2nd edition(which I find the entertaining value to be on par with the philosophy value derived, B.G is such a good writer).
2. The intelligent investor(which the value lies in the margin of safety and Mr. Market concept)
3. Damn right! Behind the scenes with Charlie Munger
4. Poor Charlie's Almanack (his lollapalooza concept is absolutely wonderful, together with his mental model to understand the world)
5. Various partnership letters and later BRK letters from Buffett and Munger(which a heap of investing treasure trove are buried)
6. Michael Porter's treatise on competitive advantage(I find it good as a preliminary mental model, but not exactly practical)

and 30+ books on various industries and accounting(I'm trained as an engineer) which I find irreplaceable in understanding businesses. As well as business journals.

Wonder if you have any good reading materials to recommend to understand the various industries in the world?


Also, on your preference for QL Resources, I can definitely see the company quality in terms of management and the growing food industry, but I have trouble projecting such a high growth rate with such a long period into the future in my calculation of its intrinsic value to the extent I think the current valuation verge on a dangerous bet on a presumably bright future. The same could be said of Top Glove and Yinson, which I think the current valuation is just fair or slightly undervalued, but not exactly one to make a bundle. This is what I think of them as I also look at how these companies make use of their incremental capital(as oppose to old capital), which I deem a very important proxy for projecting future growth rates. Of course, I could be missing out in reading correctly their industry conditions but high growth rates for a prolonged period is an assumption that I can hardly make.

It reminds me of Buffett saying he could have made a small mistake by overpaying in the Kraft Heiz deal.

Anyway, please do not contrue the above as critisicm, I would love to learn your perspective on this as well.

Posted by GrahamNewman > 2019-07-01 14:56 | Report Abuse

I do concur with your choice of GKENT(probably under the influence of confirmation bias) and the reasoning. I think it is one of the company with the highest return on incremental capital relative to price on BURSA.

Posted by Outliar > 2019-07-01 16:23 | Report Abuse

Isnt this a quarter report? Nothing especially your discussion on Gkent talks about its quarter, all time low revenue since 2015, all time low NP since 2016, what are your thoughts about that?

Posted by GrahamNewman > 2019-07-01 17:57 | Report Abuse

And it’s a shame that I did not have a few million to sink in the stock market at year 2000(damn I was still at primary 6 studying math), when it was considered the nadir of the millennium stock market.

Posted by stockraider > 2019-07-01 18:51 |

Post removed.Why?

Posted by stockraider > 2019-07-01 22:18 |

Post removed.Why?

Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-01 23:29 | Report Abuse

Every time I post and article, here goes stockraider with his rude and brainless comments and reposting entire discussions to drown out other commenters. Very rude and useless comments indeed. But worse when stick raider is someone who thinks sapura is a rm3 company in 3 years despite massive dilution, hengyuan with 35 and dgsb double share value in a month ( it has a reverse split). I wouldn't be commenting so loud if I was him, but he knows no shame.

Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-01 23:35 | Report Abuse

The buffett- munger camp is more the paying a fair price for a wonderful business.

Your concept of proverbial 50 cents for a dollar comes from the cigar butt strategy used by buffett-graham which I find is a very tired and dangerous strategy to use in Bursa, as the accounting systems here are very lax and there are tons of reverse takeover China companies and lax bursa monitoring so many companies appear to be deep value investments but turn out to be value traps instead.

Qualitative analysis is more difficult than quantitative analysis, but far more rewarding.

My advice is to not look at the numbers but to look deeper and find out what the numbers are telling you about the business.
>>>>>>

camp in terms of investing philosophy, where I try to find the proverbial 50 cents(or less) for a dollar, the qualifying dollar being derived from earning power as oppose to hard assets.

Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-01 23:40 | Report Abuse

I started making money in 2009, after losing everything in 2000. There will always be crisis and an opportunity to buy. The difference is how disciplined you are during the crisis. Do you panic? Do you buy more? It is very easy to use hindsight to say I should have bought then. But last year when oil was at its lowest, it becomes hard to throw in money at the lowest point in bursa in October 2018, where everything you touch has made money since then.

Discipline is key.

https://klse.i3investor.com/m/blog/phillipinvesting/188844.jsp

>>>>>>>>>>

07/2019 4:23 PM

GrahamNewman And it’s a shame that I did not have a few million to sink in the stock market at year 2000(damn I was still at primary 6 studying math), when it was considered the nadir of the millennium stock market

Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-01 23:51 | Report Abuse

This is my quarter report of my performance and what I think about the companies I invest in, and if the long term aspects has changed.

For gkent their past 2 quarter reports have said that contributions will come in at the end of the year from lrt3, as LGE only awarded the renegotiated contract at the beginning of the year. In construction it takes time to restart projects and get things going. Nothing has changed, except the share price being multi year lows lrt3 awarded and signed by Gkent and project claims coming in in q4 of 2019 and 2020.

It is pretty much guaranteed that lrt3 revenue and profits will come in. When revenue and profits pick up next year do you think the share price will go up?

If not this year, next year, if not it will be the year after. In either case, what is the possibility that the 11.86 billion will not be paid to gkent/mrcb and we will not be able to enjoy the additional 5.5b revenue/1 billion pbt in the 5 years to come? Additional 200 million from lrt3, mrt, the handover of the 2 new hospitals, water meter business, water treatment plant concession and enough money to bid for more projects in the coming years.

Investing is about the future, not the past. That is what makes it so hard and do worthwhile.

>>>>>>>>>>

Outliar Isnt this a quarter report? Nothing especially your discussion on Gkent talks about its quarter, all time low revenue since 2015, all time low NP since 2016, what are your thoughts about that?
01/07/2019 4:23 PM

Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-01 23:58 | Report Abuse

As for QL, it is a legacy stock for me which I started with 200k of my long term savings. My returns today is a result of quarterly top up into the busines. I have never asked anyone to buy QL, but use it more as an example of what a wonderful company is and why I continue to hold it as the dividend and share price increases year after year after year.

It is my first example of a ten bagger stock, followed by topglove which is also a ten bagger stock and now followed by YINSON which has now a 6 bagger stock( beginning of the year was rm4.08, today is 6.30) and I'm pretty sure it will be my next ten bagger stock sooner or later. I started it at 1.15 as well.

Each of which I continually add on my position every quarter instead of selling for quick short profits which I then lose in the next big "bet".

Few bets. Big bets. Infrequent bets.

Posted by Sslee > 2019-07-02 09:14 | Report Abuse

Dear all,
Philip is spot on when he say “Your concept of proverbial 50 cents for a dollar comes from the cigar butt strategy used by buffett-graham which I find is a very tired and dangerous strategy to use in Bursa, as the accounting systems here are very lax and there are tons of reverse takeover China companies and lax bursa monitoring so many companies appear to be deep value investments but turn out to be value traps instead.”

I learned it the hard way on Xingquan where they can even fake their bank account, hence the important of attending AGM and ask the hard questions.

Thank you
P/S: It had been an uphill and a difficult long walk ever since I made my decision to seek the truth and nothing but the truth when I walk out from my first ever Xingquan 8th AGM (7th Dec 2016) dumbfounded that the BOD were lying thro’ their teeth, cheating and scamming the minority shareholders with impunity and getting away with it.
Refer Xingquan 8th AGM official minutes on BOD laughable replied:
1. On the loss of RMB 415 million to supply 3.6 millions pair of custom make shoes to government agency: Only during full delivery of 3.6 million pair, the group was informed verbally that the shoes were found to fall short of the specification of antibacterial and absorbent ability.
2. On the write off of doubtful debt of RMB157.5 million: It was prudent to make provision for doubtful debt on those who had delayed in payment for trade receivable for more than 90 days.
3. On is the cash in bank real or fraud?: The cash in bank was verified by the external auditors who had obtained confirmation and printed bank balances statement directly from the various banks, the low interest income because of low interest rate and minimum placement of funds in fixed deposit accounts.
No helping is the uncaring and clueless external auditors and independent directors dance to the BOD’s tune.

Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-02 09:35 | Report Abuse

To be honest, I am sorry to hear that. I have also fallen for such scams before so I know exactly how that feels. Worse is when I did it in 1997 and 2000. Lesson learned.

One thing I learned from Charlie munger is that there is a story behind everything.

Every accounting report, every financial report is designed to tell you a story about the business. It is not wise to project too much about the business, not is it wise to take the numbers in vacuum.

Charlie munger is famous for his concept of mental models, a latticework of common operating principles that we use to solve problems and understand situations.

The first rule is then not to take numbers and results in vacuum, but to link it back to other qualitative aspects like market demand, a sudden break in the Brazil dam that increase iron ore costs, the rise of technology, a market disruption etc.

It then becomes clear that instead of taking the easy Graham road of looking for the proverbial 50 cents to the dollar business(quantitative analysis of number crunching), we dig for the for truth behind that business (qualitative analysis) is the imbalance temporary, is there a market disruptor, did the dog die and Mr Wick coming over, etc.

Never stop learning my young friend, don't think that investing is such a simple road that just use numbers and projections to get the results you need. Investing I have learned requires understanding all the mental models from all disciplines (economics, biological, mathematics, physics, chemistry, architecture, accountings) and use everything to give you that intuitive feeling how a business would perform over the long term.

Just ask Charlie. He was a lawyer turned architect turned investor who got a military scholarship in physics, and attended class in biology and chemistry just for fun.

A modern day Benjamin Franklin.

Posted by stockraider > 2019-07-02 10:07 | Report Abuse

Why did sslee fail on cigar butt when raider don leh ??

THE ISSUE IS ON SHARE SELECTION LOH....!!

DESPITE XINGUAN GOT

a} Huge cash
b) High Nta
c) Big profit & Low PE
d) Reasonable good consumer business

WHERE ARE THE FLAWS ON REDCHIP XINGUAN LEH ??

1. cashflow not good
2. No div & low div
3. Auditor not reputable
4. Business is in china but chose to list in msia.
5. Management very evasive loh...!!
6. Its cash at bank not verifiable

This is unlike Insas mah....!!
Management listen & respond to u...!!
Insas has more than 30 yrs listing record much longer than Ql & Nestle loh..!!
The cash is verifiable loh...!!
The owner is stingy but savvy like warren buffet mah...!!

U should pick counters like insas and mnrb as cigar butt play n not silly xinguan & msports loh....!!

As usual it is not so easy to invest, even if u use cigar butt investment play mah...!!

U need to have the right skill & do proper due diligence loh...!!

Posted by Sslee > Jul 2, 2019 9:14 AM | Report Abuse

Dear all,
Philip is spot on when he say “Your concept of proverbial 50 cents for a dollar comes from the cigar butt strategy used by buffett-graham which I find is a very tired and dangerous strategy to use in Bursa, as the accounting systems here are very lax and there are tons of reverse takeover China companies and lax bursa monitoring so many companies appear to be deep value investments but turn out to be value traps instead.”

I learned it the hard way on Xingquan where they can even fake their bank account, hence the important of attending AGM and ask the hard questions.

Thank you
P/S: It had been an uphill and a difficult long walk ever since I made my decision to seek the truth and nothing but the truth when I walk out from my first ever Xingquan 8th AGM (7th Dec 2016) dumbfounded that the BOD were lying thro’ their teeth, cheating and scamming the minority shareholders with impunity and getting away with it.
Refer Xingquan 8th AGM official minutes on BOD laughable replied:
1. On the loss of RMB 415 million to supply 3.6 millions pair of custom make shoes to government agency: Only during full delivery of 3.6 million pair, the group was informed verbally that the shoes were found to fall short of the specification of antibacterial and absorbent ability.
2. On the write off of doubtful debt of RMB157.5 million: It was prudent to make provision for doubtful debt on those who had delayed in payment for trade receivable for more than 90 days.
3. On is the cash in bank real or fraud?: The cash in bank was verified by the external auditors who had obtained confirmation and printed bank balances statement directly from the various banks, the low interest income because of low interest rate and minimum placement of funds in fixed deposit accounts.
No helping is the uncaring and clueless external auditors and independent directors dance to the BOD’s tune.

Posted by stockraider > 2019-07-02 10:18 | Report Abuse

Hovewer I m glad recently to see sslee cigar butt investment has improved tremendously and this can be seen thru his positive investment with a big margin of safety, a real classic authentic right strategy based on Ben Graham investment principle loh...!!

This positive performance can be seen from Insas beating QL in terms of return on investment loh....!!

Posted by (US/CHN trade war doesn't matter) Philip > 2019-07-02 10:58 | Report Abuse

Stockraider talks but acts differently. Dgsb 4.5 cents to 9 centre he say share price double in a month. Hengyuan he say intrinsic value at 35. Sapura he say is going up half a cent every day, very soon will be rm3 in 3 years 3 months.

Why did he keep posting and acting as if he never loses money? With his strategy he is almost guaranteed to lose money.

Posted by stockraider > 2019-07-02 11:17 |

Post removed.Why?

Posted by Sslee > 2019-07-02 11:52 | Report Abuse

Dear stockraider,
INSAS is cash rich with profitable main business (Stock broking and corporate finance advisory in promoting SME companies to list on the ACE and LEAP Market, Credit and Leasing, Properties rental income, Investment in quoted securities) and associate companies especially 600+ million INARI share that give INSAS yearly share of profit of associate companies and positive cash flow in dividend, sale of associate companies share. I trust Dato’ Wong and the account. I am waiting for 25th FEB 2020 when INSAS-PA and INSAS-WB expired and what Dato’ Sri Thong will do?

I also hold TAE as I like TAE dividend policy, trust the lady boss and the hotel division that provide recurring income and by the way Datuk Tiah is picking up TAE share from open market at the rate almost 2% in every rolling 6 month.

Thank you
P/S: Caution with Hengyuan, I do not trust the major shareholder and the management team.

Posted by stockraider > 2019-07-02 11:58 | Report Abuse

Yes Sslee...i m happy u add on TA...i agree this is a good margin of safety stock loh....!!

Hengyuan need to be cautious, cannot be aggressive loh....!!
The profitability no good n owner not that transparent anymore ??

Thats why raider says u will be lucky if u get Rm 7.00 loh...!!

Posted by Sslee > Jul 2, 2019 11:52 AM | Report Abuse

Dear stockraider,
INSAS is cash rich with profitable main business (Stock broking and corporate finance advisory in promoting SME companies to list on the ACE and LEAP Market, Credit and Leasing, Properties rental income, Investment in quoted securities) and associate companies especially 600+ million INARI share that give INSAS yearly share of profit of associate companies and positive cash flow in dividend, sale of associate companies share. I trust Dato’ Wong and the account. I am waiting for 25th FEB 2020 when INSAS-PA and INSAS-WB expired and what Dato’ Sri Thong will do?

I also hold TAE as I like TAE dividend policy, trust the lady boss and the hotel division that provide recurring income and by the way Datuk Tiah is picking up TAE share from open market at the rate almost 2% in every rolling 6 month.

Thank you
P/S: Caution with Hengyuan, I do not trust the major shareholder and the management team.

Posted by GrahamNewman > 2019-07-02 12:21 | Report Abuse

Well I do prefer the earning power route as oppose to the Low price to net current asset route that most cigar butt follower tend to adopt. And my 50 cents for the dollar analogy, where the dollar is derived from earning power as oppose to cold hard asset is different from the usual Graham follower. I must admit in the early months I was attracted to the Graham method but my thinking and temperament dictates earning power as a more sure fire way to evaluate true value of a company.

And indeed the 2018 GE panic did me a great help by making some excellent companies that are viewed as politically connected to get so low a price to the extent that the price reflected eternal decline in their business. Gkent is just such example. But from all the reports and the broader industry outlook over a longer time horizon, the reverse is true.

Anyway stockraider I have no intention of shaping my views on QL to your opinion. cigar butt investing is hardly going to work in the Malaysia market because even though the company has more net cash than market cap, u have to rely on the management goodwill to give that to you. It will work if you can buy your way to the board to decide your own payout, like Buffett did with Sanborn map in his partnership years. But as minority holder, you can dream about it.

Posted by stockraider > 2019-07-02 15:34 | Report Abuse

Of course earnings power route is good, but when u pay Pe 50x for it is absurb & overvalue loh....!!

Thus raider is flexible on this matter as long as fall under raider margin of safety metric loh....!!

Cigar butts investment work everywhere in the world, just that in anything u do, u need a bit of patience & some skill to judge & select loh....!!

Posted by GrahamNewman > Jul 2, 2019 12:21 PM | Report Abuse

Well I do prefer the earning power route as oppose to the Low price to net current asset route that most cigar butt follower tend to adopt. And my 50 cents for the dollar analogy, where the dollar is derived from earning power as oppose to cold hard asset is different from the usual Graham follower. I must admit in the early months I was attracted to the Graham method but my thinking and temperament dictates earning power as a more sure fire way to evaluate true value of a company.

And indeed the 2018 GE panic did me a great help by making some excellent companies that are viewed as politically connected to get so low a price to the extent that the price reflected eternal decline in their business. Gkent is just such example. But from all the reports and the broader industry outlook over a longer time horizon, the reverse is true.

Anyway stockraider I have no intention of shaping my views on QL to your opinion. cigar butt investing is hardly going to work in the Malaysia market because even though the company has more net cash than market cap, u have to rely on the management goodwill to give that to you. It will work if you can buy your way to the board to decide your own payout, like Buffett did with Sanborn map in his partnership years. But as minority holder, you can dream about it.

Posted by Jester > 2019-07-04 17:33 | Report Abuse

.

Posted by (S=QR) Philip > 2019-07-15 07:30 | Report Abuse

Updated my holdings in PCHEM.

Posted by Sslee > 2020-01-22 21:02 | Report Abuse

Dear Philip,
May the Year of the Metal Rat bring you Good Luck, Good Health, Good Fortune, Plentiful of Laughter, Happiness, Success and at Peace with Oneself and Others. Happy Chinese New Year 2020

Thank you
P/S: https://klse.i3investor.com/blogs/Sslee_blog/2020-01-22-story-h1482896892-Let_s_celebrate_the_coming_CNY_2020_together_with_well_wishing_of_Unity.jsp