Posted by risktransformer > 2019-02-16 15:31 | Report Abuse

Whatever the reason for EPF selling 2 million to 5 million shares every other day on regular basis, I think we should be very worried about its effect to the share price of PCHEM..... within a few months, it could bring down the share price from RM8.50 to RM3.00 or lower. This company may have solid fundamentals but the selfish actions of EPF (that suits its own objectives) can only cause the share price to fall drastically (due to the huge volume of selling pressure).

---------------------------------------------------------------------------------
teoct: My thinking is EPF selling to raise money for upcoming dividend payment to members rather than PCHEM is not performing.
15/02/2019 10:56
----------------------------------------------

Posted by PHconman > 2019-02-16 15:51 | Report Abuse

Who is acquiring when EPF is disposing.I believe ikan bilis not able to acquire so many shares

Posted by risktransformer > 2019-02-16 15:57 | Report Abuse

It is bcoz ikan bilis not able to acquire all those shares dumped by EPF (as well as foreign funds fleeing Bursa) that the price keep falling..... selling pressure so much stronger than bargain hunting.

Posted by PHconman > 2019-02-16 16:03 | Report Abuse

If the price keep falling definately someone is buying low else how the price can drop?

Posted by risktransformer > 2019-02-16 16:14 | Report Abuse

If u look at the past 3 months price chart of PCHEM, u will notice that it sudden dropped very steeply within a few days (starting from 7 Jan 2019)...... and incidentally, EPF started its heavy selling from 7 Jan 2019 till now (this couldn't be coincidence, right?).

On 4 Jan 2019 (b4 EPF started heavy selling), PCHEM was RM9.26; by 15 Jan 2019 (about 1 & half week from 4 Jan 2019) PCHEM has dropped to RM8.27 (dropped more than 10% in less than 2 weeks). If EPF continues its heavy selling for another 6 to 8 months, the price can easily drop another 65% (to RM3.00).

Posted by risktransformer > 2019-02-16 16:18 | Report Abuse

If buyers can buy up more than what the sellers keep selling then the price can stop falling & move up a little..... but if buyers keep buying less than what the sellers keep selling then the price will fall slowly (a few cents everyday).

Posted by PHconman > 2019-02-16 17:32 | Report Abuse

Thanks for the info.

Posted by risktransformer > Feb 16, 2019 04:14 PM | Report Abuse

If u look at the past 3 months price chart of PCHEM, u will notice that it sudden dropped very steeply within a few days (starting from 7 Jan 2019)...... and incidentally, EPF started its heavy selling from 7 Jan 2019 till now (this couldn't be coincidence, right?).

On 4 Jan 2019 (b4 EPF started heavy selling), PCHEM was RM9.26; by 15 Jan 2019 (about 1 & half week from 4 Jan 2019) PCHEM has dropped to RM8.27 (dropped more than 10% in less than 2 weeks). If EPF continues its heavy selling for another 6 to 8 months, the price can easily drop another 65% (to RM3.00).

Posted by (S = Qr) Philip > 2019-02-16 17:45 | Report Abuse

You do realize that dividends per year is 0.3 cents right? Anyone crazy enough to dump a company with rm3 in nett assets AND giving out 30 cents a year in dividends, and doing 25% nett profit, and growing it's revenue by 2 billion every year can sell their shares to me. 4 billion in earnings, if you are interested. And growing roe by 19%.

LCTITAN down the road is doing half the revenue and half the earnings and higher debt ratio is asking for more.

Any reason to sell other than epf just announced 6.15% for 2019? You do realize that no way epf with all it's investment losses in 2018 losses can give out those kind returns right?

The one you should look at is petronas, they are major shareholder. Does it look like they are selling their PCHEM shares?

Posted by risktransformer > 2019-02-16 18:19 | Report Abuse

I am not suggesting that EPF is exiting PCHEM totally. EPF has its way of pressing down a stock's price to very low level & then buying back the shares at much cheaper prices.... ending up with even more shares than b4 it started its heavy selling. Since PCHEM is fundamentally so strong & profitable, all the more EPF will want to acquire more of its shares. But EPF is very smart.... they want to acquire more of those shares at very low prices so that they can own more of the company without paying for those extra shares.

Posted by (S = Qr) Philip > 2019-02-16 18:32 | Report Abuse

I think it's more of a case where they can't sell sapura because it's underwater, they can't sell Armada because it's underwater, they can't sell fgv because it was making losses, and they can't a lot of "institutional" shares because it was loss making last year. So only way is to hold and wait.

What can they sell? PCHEM. Because it was profitable last year and can sell to cover the dividend payment to pay for epf savings this year.

Go figure.

Posted by stockraider > 2019-02-16 18:43 | Report Abuse

Rubbish loh...EPF already fully sold sapnrg mah....!!

EPF sell pchem bcos they knew it takes some time or gestation period for pchem new huge investment capacity to make profit loh....!!

Posted by (S = Qr) Philip > Feb 16, 2019 06:32 PM | Report Abuse

I think it's more of a case where they can't sell sapura because it's underwater, they can't sell Armada because it's underwater, they can't sell fgv because it was making losses, and they can't a lot of "institutional" shares because it was loss making last year. So only way is to hold and wait.

What can they sell? PCHEM. Because it was profitable last year and can sell to cover the dividend payment to pay for epf savings this year.

Go figure.

Posted by qqq3 > 2019-02-16 18:59 | Report Abuse

risktransformer My above explanation is for illustration purpose only.
=========

up also worry, down also worry, forever also got stuffs to worry about.....best is no need to invest........

see...no invest no worries.

Posted by risktransformer > 2019-02-16 19:08 | Report Abuse

qqq3, u r wrong.... in fact, I am buying more of PCHEM recently. When I say "should worry" I am just giving out cautionary note to those who r too optimistic as if nothing bad will happen to their investment.

Posted by risktransformer > 2019-02-16 21:28 | Report Abuse

Philip, u r so wrong about this. Suppose u have invested in 10 different companies & 9 of the companies were losing money or underwater accept this one company that is so profitable & growing strongly year after year. Would u keep holding onto the 9 underwater companies & sell off a huge portion of your shareholding in this profitable company to cover your living expenses? Or would u salvage whatever u can get out of the 9 underwater companies & buy more of this very profitable company? FYI, EPF has sold off its shareholdings in many of those underwater companies u listed earlier, especially Sapura Energy.

--------------------------------------------------------------------------------
(S = Qr) Philip: I think it's more of a case where they can't sell sapura because it's underwater, they can't sell Armada because it's underwater, they can't sell fgv because it was making losses, and they can't a lot of "institutional" shares because it was loss making last year. So only way is to hold and wait.

What can they sell? PCHEM. Because it was profitable last year and can sell to cover the dividend payment to pay for epf savings this year.

Go figure.
16/02/2019 18:32
-----------------------------------

Posted by qqq3 > 2019-02-16 22:27 | Report Abuse

Philips refers to accounting profits to fund dividends.... realised profits because Epf got no unrealised profit/losses

Posted by sell > 2019-02-17 10:07 | Report Abuse

EPF sell to pay 6.15% dividend?

Posted by SHUECHABOO > 2019-02-17 10:21 | Report Abuse

In my view, the EPF sold its shares is to gather funds to takeover the WEST COAST EXPRESSWAY(WCE). The takeover of WCEHB is to keep one of the promises made by the PH at the 14th GE ago.

Posted by qqq3 > 2019-02-17 10:32 | Report Abuse

SHUECHABOO > Feb 17, 2019 10:21 AM | Report Abuse

In my view, the EPF sold its shares is to gather funds to takeover the WEST COAST EXPRESSWAY(WCE). The takeover of WCEHB is to keep one of the promises made by the PH at the 14th GE ago.
========

EPF got more than enough funds to do whatever they want....it is accounting profits that is the headache.......and they are not supposed to pay dividends except out of profits otherwise can be accused of being a Ponzi scheme.......

Posted by risktransformer > 2019-02-17 10:34 | Report Abuse

If EPF does heavy selling to realised profits (accounting profits) for the purpose of dividend payments then please take note of the following (below):

EPF closed its accounts at 31 Dec every year & takes 2 or 3 weeks in Jan every year to calculate dividend payments based on the previous year's profits ending 31 Dec of the previous year. This is the accounting protocol: u cannot use the realised profits in Jan 2019 to pay the dividends for 2018 (ending 31 Dec 2018). But EPF only started its heavy selling from 7 Jan 2019 till now (mid Feb 2019)..... by accounting protocol, any realised profits from 7 Jan 2019 onwards cannot b used to pay for 2018 dividends (it must, instead, b reserved for 2019 dividend payments next year). So, I think Philip's argument that EPF sells PCHEM to realise profits for dividend payment is against the standard accounting protocol.

NB: I wonder why this year EPF delayed the announcement of dividend payment to mid Feb (usually they announce b4 end of Jan).

Posted by qqq3 > 2019-02-17 10:41 | Report Abuse

by risktransformer > Feb 17, 2019 10:34 AM | Report Abuse

. So, I think Philip's argument that EPF sells PCHEM to realise profits for dividend payment is against the standard accounting protocol.
========

that is also true....so, forget about what Philip says ....just in jest....

Posted by risktransformer > 2019-02-17 11:16 | Report Abuse

Hahaha!! qqq3, no problem.

I want to take this opportunity to acknowledge that, from what I read in Philip's posts about PCHEM, he has done a lot of fundamental research into the petrochemical industry worldwide.

However, the investment climate (or culture) in Malaysia is very different from those in mature industrialized countries such as the US, Germany & Japan. PCHEM, being based in Malaysia, may not reward investors as predictably as petrochemical companies in the US, Germany & Japan. In Malaysia, anything outside of the fundamentals can happen..... "Malaysia boleh!!"

Posted by stockraider > 2019-02-17 11:39 | Report Abuse

Not true loh....!!
Pechem is one of the best div payer loh...!!

Posted by risktransformer > Feb 17, 2019 11:16 AM | Report Abuse

Hahaha!! qqq3, no problem.

I want to take this opportunity to acknowledge that, from what I read in Philip's posts about PCHEM, he has done a lot of fundamental research into the petrochemical industry worldwide.

However, the investment climate (or culture) in Malaysia is very different from those in mature industrialized countries such as the US, Germany & Japan. PCHEM, being based in Malaysia, may not reward investors as predictably as petrochemical companies in the US, Germany & Japan. In Malaysia, anything outside of the fundamentals can happen..... "Malaysia boleh!!"

Posted by (S = Qr) Philip > 2019-02-17 11:45 | Report Abuse

I see. On what basis do you make this claim? I'm very interested to learn more.

From what I can see, ever since they spin off of petchem into bursa listed company, they have been consistently paying 50% of dividends from their earnings.

I'm starting to get worried now :)

Can you provide us concrete proof that petchem had done such a thing before and will do such a thing in the future?

I say this because a big part of my networth had been invested in petchem, so any material information from i3 community would be very helpful!

Cheers and happy CNY risktransforner!

Posted by (S = Qr) Philip > 2019-02-17 12:11 | Report Abuse

To be honest, no one here knows why EPF sold PCHEM. and since they have a few hundred million shares anyway, it doesn't really matter. Everything else is conjecture.

All we should care about and think about is whether or not PCHEM will do better in the future compared to today.

In 2010, IPO listed PCHEM with a valuation of 4.4 billion USD (around 14 billion back then). Today in 2019 it is worth 68 billion ringgit.

I would hold on all speculation and wait to see what the results for the latest QR will be before making am investment decision.

Speculators buy carimin and sapura and naim and etc without caring what the qr reports are saying.

Investors buy after understanding the latest quarterly report to see how the business is doing, then they make their decision.

Posted by newbie4444 > 2019-02-17 12:13 | Report Abuse

Takeover WCE bec you stuck there? PH will lose in election(GE15, etc) bec free toll is cheating haha.

Posted by SHUECHABOO > Feb 17, 2019 10:21 AM | Report Abuse
In my view, the EPF sold its shares is to gather funds to takeover the WEST COAST EXPRESSWAY(WCE). The takeover of WCEHB is to keep one of the promises made by the PH at the 14th GE ago.

Posted by risktransformer > 2019-02-17 13:51 | Report Abuse

Philip, my view of reward to investor is not just in terms of dividends received by investors. The total reward to investors includes both capital gains (or loss) and dividends. U need to include capital gains/loss because investors are expected to hold PCHEM over the long haul (long term). Now, when u put capital gains/loss into the equation then a new variable comes into the investment equation. This variable is the timing of your investment (which includes when u first started investing in PCHEM as well as any regular/occasional capital injection/withdrawal). If u started investing in PCHEM since its IPO then u have been handsomely rewarded over the past 8 or 9 years both in terms of capital gains as well as dividends. However, if someone else after reading your fantastic postings about PCHEM were to start investing in PCHEM at around RM9.00 or RM8.50 per share then he/she may not b as lucky as u for several reasons.

Over the past 8 or 9 years, the world was riding on one of the longest bull market (which is still bullish but may peak very soon) in history. QE administered by the US & Europe has resulted in assets bubbles (which may pop anytime soon). If these assets bubbles burst either in the US or Europe (as well as China) then Malaysia will also be affected. Currently, the world economy is already slowing down (accept the assets bubbles not yet burst). Hence, we may not assume that what capital gains, company profitability & dividend payouts that u enjoyed over the past 8 or 9 years (investing in PCHEM) will continue to bring u handsome reward as b4. Suppose u have RM8.5 million invested in 1 million PCHEM shares. U get RM300k annual dividend from PCHEM. If the share price of PCHEM were to drop to RM5.00 over the next few months due to operator manipulations (we call them sharks or syndicates..... guess who is the biggest shark in Bursa?) then your net worth will fall to RM5 million within a few months.... at most RM5.3 million if u add the dividend. Even though u won't sell a single share of PCHEM (because u r a long term investor), u will feel poorer by RM3.2 million (paper loss is a true loss in terms of market valuation).

U asked for concrete proof about PCHEM but what I am saying is the problem is not with PCHEM (good company with good management team). In an open economy, a company's future performance depends on many other variables other than the past performance of the company. As I said, u have to think what other people like the sharks/syndicates/operators will do to make big gains at the expense of ordinary investors as well as assets bubbles bursting, impending recession in Malaysia due to government financial restraints, etc. These are not concrete proofs but the signals have been given out (like the continuous heavy selling by EPF).


-----------------------------------------------------------------------------------
(S = Qr) Philip: I see. On what basis do you make this claim? I'm very interested to learn more.

From what I can see, ever since they spin off of petchem into bursa listed company, they have been consistently paying 50% of dividends from their earnings.

I'm starting to get worried now :)

Can you provide us concrete proof that petchem had done such a thing before and will do such a thing in the future?

I say this because a big part of my networth had been invested in petchem, so any material information from i3 community would be very helpful!

Cheers and happy CNY risktransforner!
17/02/2019 11:45
-----------------------------------------------------

Posted by risktransformer > 2019-02-17 14:13 | Report Abuse

EPF's selling of 2 million to 5 million shares per day on regular basis does matter a lot!

The average daily trade volume of PCHEM was 6.7 million shares. If EPF sells 2 million shares on a particular day, that accounts for 29.9% of trade volume. If EPF sells 5 million shares instead, that accounts for 74.6% of daily trade volume. These statistics showed that EPF is such a big market player that its selling can bring down the price by around 4% per day, or if it were to buy it could push up the price by 5% per day. If this goes on over the long term (like several months) then u will see capital loss reflected in your shareholdings of PCHEM.


---------------------------------------------------------------------------------------
(S = Qr) Philip: To be honest, no one here knows why EPF sold PCHEM. and since they have a few hundred million shares anyway, it doesn't really matter. Everything else is conjecture.

All we should care about and think about is whether or not PCHEM will do better in the future compared to today.

In 2010, IPO listed PCHEM with a valuation of 4.4 billion USD (around 14 billion back then). Today in 2019 it is worth 68 billion ringgit.

I would hold on all speculation and wait to see what the results for the latest QR will be before making am investment decision.

Speculators buy carimin and sapura and naim and etc without caring what the qr reports are saying.

Investors buy after understanding the latest quarterly report to see how the business is doing, then they make their decision.
17/02/2019 12:11
--------------------------------------------------------------

Posted by (S = Qr) Philip > 2019-02-17 14:16 | Report Abuse

Ah I see. For that, my only response as a concentrated long term investor is to buy only on the quarterly report and monitor how things are going every 3 months. If the story doesn't change, then you continue buying. If the story changes, then you reevaluate.

This is how I have been investing these past 10 years. I guess no matter what you just need to be vigilant.

I'm willing to cut PCHEM some rope because of it's good management and so far they have not been deviating from their business strategy. But so far I find that their business advantage is such that an idiot nephew could run the business with relative success.

https://klse.i3investor.com/blogs/phillipinvesting/188844.jsp

Posted by (S = Qr) Philip > 2019-02-17 14:23 | Report Abuse

There are too many reasons to worry about why other people are selling their stocks. What is important is the material information from the Feb quarterly report. If it is good, many people will buy more. If it is bad, the evaluate the reason why.

For myself, I welcome the chance to buy pchem stocks at such a low price. If I can buy it for rm3 I'll be even happier to sell my other positions and go all in on pchem. 10% dividend on a growth stock with roe 19% is unheard of.

Wishful thinking though.

Posted by risktransformer > 2019-02-17 14:39 | Report Abuse

Usually these multi-billion dollar institutions (including EPF) have advance information about any public listed company several months b4 the quarterly report comes out.... that's y we can't figure out y they r selling (but they already know everything ahead of others who have to depend on the quarterly reports).

Congrats on your profitable investment in PCHEM. Hope for the best!

Posted by chamlo > 2019-02-17 16:47 | Report Abuse

Saudi Crown Prince postpones trip to Malaysia
https://www.freemalaysiatoday.com/category/nation/2019/02/16/saudi-crown-prince-postpones-trip-to-malaysia/

Posted by risktransformer > 2019-02-17 22:43 | Report Abuse

Philip, one other thing to consider..... for retirees like us, we need to put more emphasis in risk management than the growth potential of companies. From what I read, u have been very successful in compounding your investments for the past 10 or 20 years. As we approach retirement, success in compounding investments takes 2nd place to capital preservation through proper risk management. Hence, capital gains from years of shareholding becomes very important (try to avoid capital loss through falling asset prices.... this is the essence of capital preservation).

Posted by (S = Qr) Philip > 2019-02-18 11:02 | Report Abuse

So far, that would be construed as insider information which is illegal and punishable by law. I have no proof the EPF knows more about material public information or has insider connections with PCHEM directors (which from all accounts have a track record of reliability, multiple other directorships in internationals companies like AIA etc, and are very ethical). You may be perfectly right, I have no way of knowing.

I choose to believe in the more plausible action, that the EPF is governed by a big group of fund managers who have different KPI and opportunity costs/risks. And also it takes a long time to unload big block of shares without causing undue stress and hitting limit down.

In the end, I think PCHEM has a very viable business, and a strong core growing moat. As long as the value of tomorrow is more than today, and I am using cash to buy the stock (instead of margin or contra), I find that I can wait longer periods of time.

Most importantly, my family currently has around 1.4m shares in PCHEM. at 29 cents of yearly dividend, that should come to quite a nice tidy sum each year to buy PCHEM stock at lower prices if things go well, and have capital gains increases if it goes up higher.

We shall see how the quarterly report goes.

I may be a bit too excitable recently, but I think you should trust me. PCHEM is solid.

>>>>>
Usually these multi-billion dollar institutions (including EPF) have advance information about any public listed company several months b4 the quarterly report comes out.... that's y we can't figure out y they r selling (but they already know everything ahead of others who have to depend on the quarterly reports).

Posted by risktransformer > 2019-02-18 17:41 | Report Abuse

It is not really insider info/trading. They have the resources (human resource, financial resource, full time, worldwide coverage, etc.) to gain better quality info (more accurate & more timely) than the rest of us. E.g. they have several teams of full-time paid researchers that visit companies, factories, interview company management personally, etc. How many of us have such resources?

Posted by (S = Qr) Philip > 2019-02-18 19:03 | Report Abuse

Oh, I see. Well that is still based on general public knowledge then. That's fine.

Everyone who spends a few hours on the internet can find the same knowledge. That is public. I was thinking you were meant EPF has material information on the quarterly results before it is packaged and announced by Bursa.

I think that is fair. Everyone has the same knowledge. Interpretation of the information however differs from individual to individual. It's funny though each time EPF sells their shares now, the price has gone up.

Meaning there are buyers who see the same thing I do.

Posted by mamatede > 2019-02-19 00:12 | Report Abuse

How do you think EPF Can give 6.19% dividend for 2018 if not by selling their equities. Pchem is one of their strong and stable stock holding to realize profit.

Posted by titus > 2019-02-19 09:07 | Report Abuse

wow...epf selling but yet Pchem going up? This must be the power of Philips .....

Posted by mamatede > 2019-02-19 09:12 | Report Abuse

EPF done selling de...should be neutral liao

Posted by titus > 2019-02-19 09:20 | Report Abuse

I was hoping price remain stagnant until QR out. I guess it is unlikely then. Mayb this Q report a good profit.

Posted by mamatede > 2019-02-19 09:48 | Report Abuse

I'm just holding up until Rapid comes in. That will be a big boost to its asset and bottomline afterwards.

Posted by risktransformer > 2019-02-19 10:00 | Report Abuse

No lah.... EPF selling not to raise fund for dividends (they r cash rich), they sell to press the price down so that they can buy more PCHEM at lower prices. This is so obvious.... I have seen them doing this so many times to other counters b4.

Posted by 2fast4u > 2019-02-19 10:19 | Report Abuse

when qr coming out for pchem?

Posted by (S = Qr) Philip > 2019-02-19 10:21 | Report Abuse

Well, if you already knew news is going to be good whether or not this QR results come out good or bad, it would be pointless to wait. I didn't.

titus: you crazy ah? If penny stocks probably la. This is a 68 billion dollar company. my 1.4 million stocks barely make any dent la. EPF sells more in 1 day than my entire exposure haha.

But i must admit, Malaysia market now is so undervalued after 4 years of recession, that almost any stock (almost) will have a dead cat bounce.

the real game is when all the quarterly reports start coming out every quarter. That is when the trading ends and the investing part comes.

Posted by qqq3 > 2019-02-19 10:36 | Report Abuse

woah, Philips starts a bull run in PChem..................

Posted by Icon8888 > 2019-02-19 10:37 | Report Abuse

good call. I bought some yesterday

learn to dumb dumb hold forever see what happens

Posted by mamatede > 2019-02-19 10:52 | Report Abuse

Though EPF is cash rish, i dont think they run a ponzi scheme where they take new money contribution to pay out dividends. they need to sell somewhere to register profits.

Posted by qqq3 > 2019-02-19 10:53 | Report Abuse

http://www.bursamarketplace.com/mkt/tools/research/ch=research&pg=research&ac=503115&bb=514268

Kenanga Research....not a single sentence on PIC.....

Real investors/ Good investors focus on PIC.....

The standard of analysts in Malaysia very disappointing......

Posted by mamatede > 2019-02-19 12:06 | Report Abuse

http://www.theedgemarkets.com/article/morgan-stanley-upgrades-petronas-chemicals-overweight

Posted by titus > 2019-02-19 13:36 | Report Abuse

Philips, i also bought some. But i was waiting for the QR to see if i should commit more of my fund here. I don't have a large pool of fund like you and therefore it is more important for me to test the water 1st before dipping in. I never know will it be too hot for me. Mayb as for you, if too hot, you have be ability to put in ice cube ma (buy more loh if go down)

Posted by UnicornP > 2019-02-19 15:26 | Report Abuse

Someone sure everyday searching all the stocks in Bursa to see which stocks not yet rebounded from mid-Dec crash.