Posted by PlsGiveBonus > 2017-04-26 09:57 | Report Abuse

PER is lowest among all banking sector
Definitely good to buy

Posted by kksk123 > 2017-04-26 10:25 | Report Abuse

http://klse.i3investor.com/blogs/midfresearch/121452.jsp Even MIDF also revised their target price to RM18.20. Let's see what's the target price from Affin Hwang.

Posted by linges > 2017-04-26 10:35 | Report Abuse

Why going down??

Posted by jeckcw > 2017-04-26 10:41 | Report Abuse

single digit PE double digit growth ,3.5% DY ,30% ROE ,NPL 2.x %

Posted by gcke > 2017-04-26 10:47 | Report Abuse

Along the way the price will drop or up.That is how the market forces work.
2.But looking at the Technical Price Chart the stock is well supported.There is more upside to come.
3.The Moving Average(MA) chart is trending nicely upwards.
4.The MACD and RSI support the bullish trend to come.In the offing.

No worry- just temporarily.Cheers and have a good day:-)))

Posted by linges > 2017-04-26 10:50 | Report Abuse

Thx guys :))
I plan to buy today..but was worry when see downtrend..

Posted by kksk123 > 2017-04-26 10:55 | Report Abuse

with CAGR 15% of profit growth, current PEG is below 0.66, definitely worth to buy.

Posted by paperplane2016 > 2017-04-26 11:46 | Report Abuse

80% in Top30 hands. easily can be manuever

Posted by uncle988 > 2017-04-26 13:05 | Report Abuse

20% room to appreciate, why not?

Posted by samsambank > 2017-04-27 23:38 | Report Abuse

Non-bank lenders are beating the market
http://www.thestar.com.my/business/business-news/2017/02/18/nonbank-lenders-are-beating-the-market/

Posted by Jon Choivo > 2017-04-30 12:37 | Report Abuse

Hey Guys,


One thing im worried about is how borrowings have increased so much every year. As at the latest quarter its at 5.9 billion. One can argue that borrowings is needed to fuel growth, but since 2012, revenue have gone up 2.8 times from RM344mil to RM965mil. While profit have gone up by 2.38 times from RM95mil to RM228mil.

In the meantime, borrowings have gone up from RM1.1bil to RM4.9bil or 4.5 times.

This seems highly inefficient to me, or is there something about the financing industry i dont understand?

Posted by Chua Yoke Lian > 2017-04-30 13:42 | Report Abuse

Very very good questions,more and more capitals are needed,how to get good profits in the future?

Posted by Jon Choivo > 2017-04-30 14:01 | Report Abuse

Here's my question, since 2008, this company have every single year posted a negative operating cashflow, from 113m negative operating CF in 2008 to 833 million negative operating cashflow in 2016.

Since 2007, they have never a posted a positive operating cashflow. This is highly unusual and very worrying.

And it is trading an more than 2 times book when most banks only trade at 1.1 or so.

All term loans and borrowings are bullet payments, which means they must be paid in full upon maturity. This means that the company must obtain more loans to pay off. Since at the current profit of 230m (lets ignore the negative operating cashfow for now) they will need more than 20 years (with no dividend payments) to pay off the loan.

Now we can say that this is a finance company, they take loans to give loans to the public. Fair enough. I can accept a high growth in borrowing then, but, increasing negative cashflow for every year since 2007 (earliest i can get). This is very worrying.

This feels a bit ponzi (probably an overstatement). Constant dividends and rev plus profit growth is covering up this matter. But there must a come a time when the party must stop.

Posted by stockmanmy > 2017-04-30 14:36 | Report Abuse

jon....operating cash flow is profits add back depreciation and some minor adjustments ....how can it be negative cash operating cash flows?

You are not referring to negative operating cash flows but to changes in cash balances including working capital and capital expenditures..........a growing finance company with ever increasing working capital...just the way it is supposed to be.

Posted by stockmanmy > 2017-04-30 14:43 | Report Abuse

How to get good profits in the future?

It has good ROCE ..............that is how it will continue to get good profits in the future.


Chua Yoke Lian > Apr 30, 2017 01:42 PM | Report Abuse

Very very good questions,more and more capitals are needed,how to get good profits in the future?

Posted by 3iii > 2017-04-30 14:43 | Report Abuse

FCFE = FCFF + Net Borrowing - Interest * (1- tax rate)
FCFE = NI + D&A - CIWC - Capex + Net Borrowing

FCFF = CFO - Capex
# FCFF = [NI + D&A - CIWC + Interest * (1 - tax rate)] - Capex

CIWC = Change in Working Capital


1. As Aeon Credit grows its business by giving out more loans, its accounts receivable and working capital increase. These are funded mainly by borrowings.

Its working capital increases substantially more than its NI + D&A, (refer equation # above).

Therefore, not surprisingly its CFO and FCFF are usually negative.

FCFF is the cash flow available to all the firm's providers of capital and these include the common shareholders, lenders and bondholders.

2. However, if you look at the FCFE, this should be positive.

This is the cash flow available to the firm's common shareholders.

Thus, it is able to pay its yearly dividends, the quantum of them have been increasing over the years.

3. As long as its return on capital is > than its WACC, Aeon Credt is doing fine.

Posted by 3iii > 2017-04-30 14:56 | Report Abuse

FY 2016

Balance Sheet

LT debt 4491m
ST debt 694m
Total debt 5185m

Equity 785m

Total Capital Employed = 785 + 5185 = 5970m


Income Statement

Interest payments 162m
Pretax profit 302m

EBIT = 302 + 162 = 464m


EBIT / Capital Employed = 464 / 5970 = 7.77%.

Its return on capital employed is a lot higher than its cost of debt. (Check this out on how much is its Sukuk bond rates).

Through leveraging on debts carefully, it has been doing fine in this financing sector.

Posted by 3iii > 2017-04-30 15:12 |

Post removed.Why?

Posted by 3iii > 2017-04-30 15:14 | Report Abuse

It pays well to invest in oneself first.

Posted by stockmanmy > 2017-04-30 15:15 | Report Abuse

The health of a finance company / bank is measured by its liquidity ratios , capital ratios, maturity analysis, provisions and what nowadays are called stress test.

I think a proper stress test will reveal to you that AEON CR is far ahead of most commercial banks in Malaysia ...it has huge amounts of very long term liabilities , $ 500 million is hedging assets from which it lost $ 34 million in 2015, proofing it is a very conservative place, 90% of debts overdue more than 3 months have specific provisions.

Full details in Notes to the accounts.

Posted by stockmanmy > 2017-04-30 15:22 | Report Abuse

Being in the retail end of financing is actually safer than commercial banks who often gets over exposures to single customers or single industry.

Posted by stockmanmy > 2017-04-30 15:36 | Report Abuse

I really don't know what happened but charts shows that this share peaked in 2013 at $ 19 and then keep dropping to a low of $ 11 early 2016 and then started recovering...all this while the fundamentals and profits keep improving in these years and PE ratios keep dropping until its recovery....if its PE recovers to old high, this will be a $ 30 stock.

Posted by Jon Choivo > 2017-04-30 15:42 | Report Abuse

Fair enough, let me look abit more.

Posted by Jon Choivo > 2017-04-30 15:46 | Report Abuse

Ok, so if we net off the "Net cash used in operating activities" with the "Net cash generated from financing activities". Since loans is in more than one a kind of trade payable for this company.

We basically break even.

Posted by Jon Choivo > 2017-04-30 15:47 | Report Abuse

Looks good. Thanks!

Posted by stockmanmy > 2017-04-30 17:03 | Report Abuse

you cannot use tools invented for manufacturing companies and use for banks and finance companies.




Jon Choivo > Apr 30, 2017 03:46 PM | Report Abuse

Ok, so if we net off the "Net cash used in operating activities" with the "Net cash generated from financing activities". Since loans is in more than one a kind of trade payable for this company.

We basically break even.

Posted by stockmanmy > 2017-04-30 17:13 | Report Abuse

Jon

Banks normally borrow short and lend long and take the spread. When crisis hits, the weaker banks cannot get refinancing and go bust.

But this AEONCR borrows longer and lend long....its maturity spread is very very safe...think about it.

Posted by cindy89 > 2017-05-01 08:34 | Report Abuse

dropping previously from a high in 2013 coz of QE tapering and foreign funds selling pressure especially from Aberdeen. Guess their managers r thinking tat it's better to shift funds towards other markets, ie.US. which actually might be a better option if u look at it now in hindsight

Posted by stockmanmy > 2017-05-02 15:47 | Report Abuse

meaning AeonCr can reach $ 30 this round?

Posted by paperplane2016 > 2017-05-02 23:08 | Report Abuse

Hopefully.

Posted by Patrick Ngian > 2017-05-02 23:27 | Report Abuse

a negative free cash flow company won't give a retained earning growth from 233M in year 2012 to 866 M today. I think for financial stock is better to use FCF to equity holder ( FCFE) rather than FCFF. Bcos so long AEONCR management can pay its debt on time then I have no issue for them to use debt to fund growth. And they are issuing rights to raise fund, their debt level will drop significantly , which also giving them more capital to fund future growth.

Posted by paperplane2016 > 2017-05-03 01:17 | Report Abuse

Yes. No need think so much. If Japanese can top AV, they top everything OK.

Posted by 张天师买股票 > 2017-05-04 12:13 | Report Abuse

好股！

Posted by IamGoogle > 2017-05-04 15:37 | Report Abuse

follow paperplane, join boat & add some

Posted by paperplane2016 > 2017-05-04 17:28 | Report Abuse

frinally, 17

Posted by paperplane2016 > 2017-05-05 14:15 | Report Abuse

ROE, ROA better, that's because higher risk taking. But if manage well, shall be ok. They must be smart enough to know customers not defaulting high

Posted by kksk123 > 2017-05-05 15:27 | Report Abuse

Price is what you paid, value is what you get, AEONCR will reflect its "real value" in the foreseeable future.

Posted by paperplane2016 > 2017-05-05 23:40 | Report Abuse

What is real value?

Posted by 张天师买股票 > 2017-05-08 13:59 | Report Abuse

没跌，难买

Posted by IamGoogle > 2017-05-09 10:02 | Report Abuse

Dominant market player in motorcycle loan

Posted by IamGoogle > 2017-05-09 10:05 | Report Abuse

Paperplane, new accounting standards apply already?

Posted by Ricky Yeo > 2017-05-09 14:31 | Report Abuse

Aeoncr main business is involved in car, motorcycle, credit card, personal and consumer durable loan. Motor, car and personal loan make up the largest portion of their lending.

High ROE comes from high margin because motorcycle loan typically carries 7-9% interest rate, unless the motorcycle is 500cc and above, which is rare in M'sia anyway. Motor loan is their main line when they started many years ago. Personal loan carries high interest rates as well, around 10-18% depends if you are an Aeon card member or not. So these factors contribute to high ROE.

Future ROE is likely to come down as car loan continue to grow faster than other segment, and car loan only carries 4.8-5.5% interest, depending on the age of the car. Therefore, net interest margin for Aeon continue to shrink just like over the past 3 years when car started to occupy a larger portion of their assets, current sitting at 29% of total receivables. Net interest margin for the past 3 years has came down from 13% to around 11% now. But compare this to big banks NIM of average 2.2%, it is still extremely good.

Posted by kksk123 > 2017-05-09 17:23 | Report Abuse

agreed with Ricky Yeo. I think Aeoncr strategy was fine, to obtain more market shares. As long as its profit can keep on growing, still a 5 stars stock for me.

Posted by PlsGiveBonus > 2017-05-09 17:26 | Report Abuse

Compare to all the banking peer
can go up another 100% more
:))

Posted by Tai KT > 2017-05-09 17:43 | Report Abuse

haha

Posted by Tai KT > 2017-05-09 17:45 | Report Abuse

efficiency as good as Pbbank

Posted by paperplane2016 > 2017-05-09 20:10 | Report Abuse

Mfrs9 is effective for most 2018

Posted by paperplane2016 > 2017-05-09 20:11 | Report Abuse

New standard in a way more prudent..Higher provision for sure

Posted by PlsGiveBonus > 2017-05-11 11:01 | Report Abuse

Buy more
:)

Posted by paperplane2016 > 2017-05-11 11:10 | Report Abuse

hopefully 18--20---25