3 people like this.

8 comment(s). Last comment by BeckettFox 5 days ago

Zazzyy

342 posts

Posted by Zazzyy > 1 week ago | Report Abuse

different strokes for different folks . one talks english the other talk abbreviated mumbo

enning22

2,951 posts

Posted by enning22 > 1 week ago | Report Abuse

ANGPAO with poison.

calvintaneng

58,045 posts

Posted by calvintaneng > 1 week ago | Report Abuse

Posted by enning22 > 7 hours ago | Report Abuse

ANGPAO with poison.

Enning22

Stay safe in SUPERMAX (healthcare)

https://klse.i3investor.com/web/blog/detail/www.eaglevisioninvest.com/2025-01-30-story-h498586274-SUPERMAX_7106_IN_CYCLICAL_UPTURN_NOT_AFFECTED_BY_DEEPSEEK_AS_IT_IS_INTO_

dragon328

2,676 posts

Posted by dragon328 > 1 week ago | Report Abuse

@enning22, I don't think the bonus warrants proposal is that bad.

People gruntle about the non-tradeable warrants, but do take a step back and think about it.

What you need to do is sell 1/5 of your holdings after getting the free warrants entitlement (if you do not have extra money to exercise the warrants), get the free warrants accredited into your account in a few weeks then exercise the warrants and get new mother shares. You will straightaway benefit from the huge discount in the warrant exercise price. There is no risk to existing shareholders.

The only thing we need to consider is that how much earnings dilution this corporate exercise may bring after the warrants are exercised. I have put up my estimate in the article and I think the earnings dilution will not be more than 10%.

OTB

11,724 posts

Posted by OTB > 1 week ago | Report Abuse

@ Mr dragon328,
I am very disappointed on the free bonus warrant announcement which is non-tradable.
I believe the BOD of YTLP should follow the same rule on free bonus warrant like before.
Should not set a precedence for a new type of free bonus warrant issued which is not fair to retail investors and some institutional investors.
It is definitely more advantage to have free bonus warrant tradable than non-tradable.

I am appealing to BOD of YTLP to reconsider and change it to tradable warrant.
I am also writing a formal complaint letter to Bursa Malaysia to request a review of YTL Power’s non-tradable bonus warrants.

I hope that all investors will do the same to appeal to the BOD of YTLP on this unfair rule or practice.
I believe the share price of YTLP would have moved up north on 24/1/2025 if the free bonus warrant is tradable instead of the share price of YTLP dropped 0.44 on 24/1/2025.
Thank you.

dragon328

2,676 posts

Posted by dragon328 > 1 week ago | Report Abuse

Mr. OTB, I shared your disappointment feeling initially when I learnt about the non-tradeable warrants, as I also thought it might cause the share price to drop rather than to go up. The market here always welcome free warrants or bonus shares, as traders can just sell off the free warrants or bonus shares for a quick profit.

But if we think about it, how much would the share price go up had the warrants been made tradeable? I had earlier calculated the potential "gain" to shareholders:

(RM4.06 - RM2.45) / 5 = RM0.32 per share of YTL Power held

That was the initial response of many, but please come to think about it, if the warrants were made tradeable, then the bonus warrants would have a theoretical value to them, and hence the mother share price would get adjusted down for such theoretical value when the bonus warrants go ex. Hence, for shareholders of YTLP, we might not get the desired "gain" as calculated above.

That's one point. Another point to note is that the bonus warrants proposal will essentially increase the share base by 20%, hence potentially diluting the earnings when more warrants are exercised. By making the warrants non-tradeable, many funds who cannot hold non-listed securities may just sell off the mother shares they have, or just exercise the non-tradeable warrants immediately after they receive the free warrants. For retail investors like us, we will either also exercise the warrants straightaway or hold them until expiry without exercising. So the effect is that there will not be 100% warrant conversion so the potential earnings dilution will be less than 20%. Another effect is that most people (funds or retailers) will exercise the warrants straightaway, so we will be able to see new conversion into mother shares fast enough. And the effect is that the potential share overhang from the warrant exercise will not be there, as most shareholders would have sold 1/5 of their holdings before they receive the free warrants so these shareholders will not sell the new mother shares converted from warrant exercise. The new funds or investors who buy in the mother shares due to the attractiveness of the discounted warrant exercise price will also likely go through the warrant exercise and get extra mother shares at a discounted price, so they will likely not selling the extra mother shares from warrant exercise (as the initial batch of mother shares they buy will have a lower average purchase price only after counting in the extra mother shares they receive from warrant exercise) and they will keep all the shares for long term investment.

Now we see the markets have spoken. The share price of YTL Power dropped about 10% last Friday after the bonus warrants proposal was announced Thursday evening, and that actually reflects the potential earnings dilution which I project at about 10%, and not because the warrants are not tradeable.

The subsequent drop in YTLP share price on Monday and Tuesday was mainly due to the DeepSeek news, rather than the bonus warrants proposal anymore. This is evident from the fact that net short positions on YTLP did not reduce after the 10% drop in share price last Friday, but net short positions dropped meaningfully after Tuesday close. That coincided with a rebound in all data centre-related stocks (like Suncon, Sunway, Nationgate and YTLP), which shows that those shorts were added due to the DeepSeek news rather than the bonus warrants proposal.

At the end of the day, the share price of a stock will always reflect the values and earnings of the company. The traded volumes on YTLP were so big (more than 70m shares each day) that the share price could not be possibly affected by just some retailers/funds selling due to the non-tradeable warrant issue.

dragon328

2,676 posts

Posted by dragon328 > 1 week ago | Report Abuse

HLIB data already shows that the selling on YTLP last Friday and Monday was mainly done by foreign funds and to a smaller extent by local funds. Retailers were the only net buyers of YTL Power shares on those days.

The foreign funds and local funds who sold YTLP shares last Friday and Monday were mainly because of two reasons:
1) they sold 1/5of existing holdings first before they get the free warrants
2) they see some 10% earnings dilution from the warrant exercise

The selling was never due to non-tradeable warrants, as fund managers tend to look at the fundamentals and the long term effect, to the dollar and sen, not looking at how much quick gain they would make out of the warrants.

As I explained in my article above, I see long term positives from the bonus warrant proposal, as it implies to me something big may be coming as YTL bosses are seeing great opportunities we do not see yet.

If you were already prepared to hold YTLP shares till 2026 to enjoy the earnings jump to 50 sen per share, so I would suggest everybody to just hold onto your YTLP shares and try to withstand the negative headline effects, as nothing has changed to YTLP's fundamentals. Its earnings will still grow higher in FY2025 to FY2027. The bonus will come if YTLP managed to scoop up some quality assets at bargain prices using the funds raised from the free warrants in coming months.

Posted by BeckettFox > 5 days ago | Report Abuse

Thank you so much for the info.

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