KUALA LUMPUR: British American Tobacco (M) Bhd posted a third straight quarter of operating profit growth, as its main cigarette brands Dunhill, Rothmans and KYO gained market shares in their respective segments.
Thailand rate is just 0.50% So Thailand Bank FD should be around 1.00%. Malaysia should lower to 1% with FD at 1.25--1.35%------Even BAT price at RM20 (with 83cents dividend), you are still at 4.15%----Of course that doesnt including a 30% increased stock price ( say you bought at 10 )
BAT today should be priced similar to it's beer company comrades Heim and Carlsberg in the 20+ range. BAT still undervalued and will eventually get there.
Average Malay youth spends about RM100 on Vape per month( lowest estimate ) There are more than 1 million Vape users ( excluding Chinese + Indian ). So per Quarter is 300mil Sales, if BAT capture 50% market , addition of 150mil to Sales-----Very Hard to see why 50cents dividend is NOT possible. OR RM50 by year End
Vape will be the game changer. By the time the Vape sales come in for BAT you will not see BAT share price below 15 again, or even below 20 I would say.
a good and profitable company might not wan to share their profit...but BAT history give almost all their profit as dividend....where to find?.........
IB knows BAT is a sleeping giant coz when Vape business comes later it will soar and will say good bye to this low share prices we are seeing now. That time those want to chase will have pay Heim and Carlsberg prices at the very least.
I laugh when naysayers say this is a sunset business. At it's worst QR last year hit by the worst pandemic in a century BAT can still make at least 50+ million net profit and yet they call it sunset business?
Cigarrette was 10% Tax ----30years ago. Vape is 10% tax in 2021----How explosive was Cigs 20years ago----Same as Vape Demand in 2021----Bankers Nuts are shrinking Daily---Call Warrant Closing, they are throwing every Negative things in But i think it will End Up as Glove Counters. Next Qr Bankers will said "50" no choice
Need to wait till next quarter announcements to see how hard the additional enforcement on government side actually translated to any improvements to BAT's bottomline.
But from the management's commentary, it is neutral sounding at best considering that their commentary was prepared around this period of time and they don't write anything upbeat for future. Usually for company with possible good upcoming future quarter or good improvements, they will write it. Example like UWC, they mentioned about expansion and current production floor eating into normal corridors.
so i will say that upcoming quarter Q1 will still be somewhat meh....as the government need a little time to "warm up" to cracking down. Q2 would be a better reflection of whether turning point materialises. If by then still neutral tone, cannot be optimistic on government enforcement on black market ciggs....
alcohol & rokok is something needed in the world since long time ago... only is if sell legal(with tax) or illegal(no tax) ,then the company earn less else..buy and keep ...get dividend ... re-invest dividend ...buy and keep..and repeat... then your son will no worry for his future.
This CIMB Tp in Oct 2019 (pre-pandemic ) same Quarter as 2020. The price falls short and depressed by Covid and lately operation by Call Warrant operators.
Usually Not many Call Warrants are actually subscribed unless it is very cheap at initial offering. If things DonT turn out Good for CW, operator just Stop issuing New ones Or buy back issued ones. This forced conversion rate to be Much higher than Mother price. (surging mother is always a big, big headache for Operator---but they can reduce losses by diversified into many "Different" stock CW to reduce Risk ) Bank do report "loss" from stock exposure
From previous observations, Banker will fight to control Mother price if within 20% range. But in TopGlove case( also Bat case )Bankers will buy back warrants And start sapu Mother at Cheap price by giving low, low Tp....When they are done "sapu..ing" . they will suddenly give High TP like in Glove Counters----20, 30, 40 suddenly 80, 90.
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
ckfcpc
19 posts
Posted by ckfcpc > 2021-02-11 09:11 | Report Abuse
Yes, up up