Posted by Fabien _the efficient capital allocator > 2024-06-22 19:51 | Report Abuse

Inno do not own the plantation land. By right, Inno should trade at a discount to the rest of plantation owners.

Posted by Sardin > 2024-06-23 02:12 | Report Abuse

You're right, Fabien. There are at least 3 wonderful things about Inno. First, talk about the land. Land concession is until 2073. It had been extended before, and will be again in future. Company like UP needs to pay for the land as quite a lot of it are leasehold. This cost is recognized as amortization. Comparing this to the rental Inno is paying despite the fact that Inno owns no land, one will find that the "effective cost to use the land" for Inno is a significantly less (RM 1.83 per ha per year or RM 3.40 if you want to assign 0 cost to the land planted with laran trees and move all the cost to the oil palm plantation). The 2nd wonderful thing is this FY2024 EPS and DPS. I would like to get your view on that. Let's see if we got the same figure.

Posted by Tanleechoo > 2024-06-23 15:25 | Report Abuse

Tqsm Sardin for sharing

Posted by lionel messi > 2024-06-24 08:26 | Report Abuse

@moneyontheway, Q1 dividend already announced and will be paid on 28/6/24. 2.25 sen.

Posted by Thirai Thiraviam > 2024-06-24 22:22 | Report Abuse

@Sardin:
> There are at least 3 wonderful things about Inno. First, talk about the land. Land concession is until 2073. It had been extended before, and will be again in future. Company like UP needs to pay for the land as quite a lot of it are leasehold. This cost is recognized as amortization. Comparing this to the rental Inno is paying despite the fact that Inno owns no land, one will find that the "effective cost to use the land" for Inno is a significantly less (RM 1.83 per ha per year or RM 3.40 if you want to assign 0 cost to the land planted with laran trees and move all the cost to the oil palm plantation). The 2nd wonderful thing is this FY2024 EPS and DPS.

Innoprise is in a cyclic commodity business, yet it enjoys a rather decent PER. We have to ask why. I feel the wonderful things you mentioned above are already priced in. From their own reporting, we know that the company is highly dependent on the price of CPO, which, after almost halving a couple of years back, has been stable at around RM 4,000 per ton. So, any growth in earnings must come from either increased production or improved productivity.

As of the end of 2023, the company reported that only 0.5% of the trees were immature; the rest were already producing. (In 2022, 261 hectares were planted with immature trees; this reduced to 56 hectares in 2023.) Regarding the laran trees, they are expected to achieve maturity only about eight years from now. Overall, we do not see much room for growth.

Regarding productivity improvement, the company reported that oil and palm kernel extraction rates improved by 1% and 3%, respectively, in 2023. This, too, suggests a lack of room for growth.

My screener shortlisted this stock because of its strong financials, profitability, and its closeness to the 200-day SMA, but its lack of growth prospects gives me pause. Let me know if I've missed something. Cheers.

Posted by lionel messi > 2024-06-25 08:41 | Report Abuse

I am happy if they can give at least 10 sen dividend every year. Hope not asking too much.

Posted by Sardin > 2024-06-25 11:57 | Report Abuse

@Thirai Thiraviam. Happy to see your response and your thoughts. In the end all the thoughts must be summed up to EPS and DPS forecast in order to give yourself (ourselves) a clear buy, hold, or sell decision. So, based on your best knowledge in Inno, what would be the EPS and DPS for FY2024? After that I will respond in which areas you had not mentioned.

Posted by Thirai Thiraviam > 2024-06-25 16:23 | Report Abuse

@lionel_messi and @Sardin -

For a company to pay a decent (and, hopefully, growing) dividend, it needs to have a decent and growing revenue. In the case of Innoprise, its dividend payout ratio of 0.88 is rather high, leaving very little room to further increase the payout ratio should revenue suffer for any reason. This high payout ratio also suggests that the company might not have significant growth opportunities requiring reinvestment of earnings.

I also looked at the company's net income and accounts receivables for Q1-23 and Q1-24. In Q1-23, net income was RM9.1 million and accounts receivables were RM2.28 million. For the latest quarter, receivables have more than doubled to RM4.67 million, while net income has only slightly improved to RM11.8 million.

I also have questions about the increasing values assigned to plantation trees*, but this suggests (to me, at least) that the company could be a little too creative in recognising revenue.

Given all the above, I’d give this company a pass. I see little upside in the near future, and the dividend would likely be cut if the price of CPO falls below its current RM4,000 per tonne.

* The following is from its 2023 annual report: "Biological assets classified as non-current assets represent standing growing trees to be harvested upon maturity. These plantation trees are measured at fair value less costs to sell. Any gains or losses arises from changes in the fair value less costs to sell are recognised in profit or loss."

Posted by Tanleechoo > 2024-06-26 23:01 | Report Abuse

Tqsm @sardin .. current price is 1.41 , n what is yr valuation . Is it a good time to enter ?

Posted by Sardin > 2024-06-28 09:50 | Report Abuse

@Tlc. Definitely

Posted by Tanleechoo > 2024-06-28 15:40 | Report Abuse

@Sardin tqsm for the advice .. I do read how u analyse UP n make some money in UP .. Tqsm again for the guidance

Posted by calvintaneng > 2024-07-02 09:54 | Report Abuse

Hi guys

Tsh Bod (Board of Directors) have been very generous with Inno plant share holders by giving out dividends four quarters a year

Tsh also benefitted as Tsh owns 105 Million Inno shares

Now that Tsh has finally paid off Billion ringgit worth of Assets (Inno got none as all Inno lands are rented free from Sabah Govt) Tsh being a cash rich entity can now follow Inno examples to give out very good dividends

Just keep all good Inno shares And if you got extra cash can buy some Tsh now

When Inno started giving out great dividends its share price jumped 200% from 50 sen to over Rm1.50

By the same pattern and more Tsh can also up 100% to 200%

Posted by thanos2020 > 2024-07-04 18:48 | Report Abuse

https://theedgemalaysia.com/node/717790

CPO prices still holding above RM3500-RM4000/tan for 3mths... Inno/other plantations shld be making loads, since cost per CPO is ard RM2K+/tan

Posted by moneyontheway > 2024-08-20 10:53 | Report Abuse

@lionel, how many sen is the div, i did not see it came out in the starbiq

Posted by Income > 2024-09-21 16:24 | Report Abuse

Why still around the same price?

Posted by lionel messi > 2 months ago | Report Abuse

Give you a chance to buy cheap for the next dividend. Isn't it wonderful?

Posted by s3phiroth > 2 months ago | Report Abuse

fcpo is now back to 4000!

Posted by lionel messi > 2 months ago | Report Abuse

Finally woken up. Wonderful.

Posted by Income > 2 months ago | Report Abuse

Minun Eno

Posted by JrWarren > 2 months ago | Report Abuse

Finally start moving, nice dividend stock since 2021.

Posted by Income > 2 months ago | Report Abuse

Minum Eno Lagi

Posted by Income > 1 month ago | Report Abuse

Minumlan ENo setiap hari

Posted by Tanleechoo > 1 month ago | Report Abuse

Coming qtr .. good result n dividends?!

Posted by Income > 1 month ago | Report Abuse

Minum ENO lagi, puas

Posted by Tanleechoo > 1 month ago | Report Abuse

Possible 2 if up move so much

Posted by Income > 1 month ago | Report Abuse

Eno drinks is cooling

Posted by Starship2 > 1 month ago | Report Abuse

Almost 2 quarters of high cpo prices is in the bag.. My guess is it means better dividends for the last and this quarters...

Posted by calvintaneng > 1 month ago | Report Abuse

Go go Inno

https://klse.i3investor.com/web/blog/detail/www.eaglevisioninvest.com/2024-07-12-story-h-157019176-WHOLE_WORLD_PALM_OIL_IN_BULL_RUN_WHEN_WILL_MALAYSIA_RESEARCH_HOUSES_UPG

Posted by mf > 1 month ago | Report Abuse

Israeli strike kills Hezbollah spokesperson as group prepares response to fresh ceasefire proposal
Tamara Qiblawi Hamdi Alkhshali
By Tamara Qiblawi, Allegra Goodwin, Ibrahim Dahman, Abeer Salman, Hamdi Alkhshali and Catherine Nicholls
5 minute read
Updated 3:33 PM EST, Sun November 17, 2024

Posted by Sardin > 1 month ago | Report Abuse

Dividend in Q3 should be more yoy. Q4 will be even better. Next year potentially better than 2023. I tell you before the analyst report 😁

Posted by lionel messi > 1 month ago | Report Abuse

Wow guru Sardin, that's a fantastic confidence and morale booster. Great to have you back.

Posted by Sardin > 1 month ago | Report Abuse

I want to replicate my success in UP here base on one thing.

Posted by lionel messi > 1 month ago | Report Abuse

Hope you have a strong basis. UP is a hard act to follow. The best of the best.

Posted by Sardin > 1 month ago | Report Abuse

The strong basis is exceptional dividend yield

Posted by Sardin > 4 weeks ago | Report Abuse

Price movement shows someone is not happy with me. 😂 Nevermind.

Posted by lionel messi > 4 weeks ago | Report Abuse

How can anyone be not happy with "exceptional dividend yield?" I am busy shopping for best buys. Thanks for the cheap sale Mr Market.

Posted by Tanleechoo > 3 weeks ago | Report Abuse

Div 3.8 cts

Posted by Sardin > 3 weeks ago | Report Abuse

Smile

Posted by s3phiroth > 3 weeks ago | Report Abuse

Expecting even more dividend in next quarter! Huat ah!

Posted by lionel messi > 3 weeks ago | Report Abuse

Guru Sardin was spot on. Real student of Inno just like he was for UP. Terima kasih. 😍

Posted by Dehcomic01 > 1 week ago |

Post removed.Why?

Posted by Sslee > 1 week ago | Report Abuse

You just need to look into IBs analysis report on capitalA. They can't even figure out or agree on what is capA core profit/loss when they are reading the same financial report.

IBs analyst are paid just to write what the IBs want nothing more and nothing less.

Posted by Starship2 > 1 week ago | Report Abuse

In a volatile market, a resonably good dividend stock is a better bet for value investors compared to high valuation "growth" stocks in the market. It may be different for short term traders

Posted by Tanleechoo > 1 week ago | Report Abuse

👍

Posted by Sardin > 1 week ago | Report Abuse

Cast your vote, I have casted mine. Lucrative business for everyone to grab.

Posted by Starship2 > 5 days ago | Report Abuse

With this 4Q coming to a close, it looks like EPS and the dividend for the quarter is going to be better that the 3Q.. Noted that the spot prices for Jan to Mar 2025 is in the region of RM4800..Not bad..The two festivals coming up may be supportive of CPO prices

Posted by Starship2 > 5 days ago | Report Abuse

Taking from the internet, the company has 2219 employees ..assuming all are paid just RM1500, the additional cost will be just RM443,800...a relatively small amount compared to the profit of RM21.6m during Q3 2024

Posted by Starship2 > 4 days ago | Report Abuse

Opps overlooked...RM443,8000 is additional monthly labour cost..assuming that ALL its workers are now paid only RM1500 per month..Since the new RM1700 pay only begins in Feb, the cost will be times two ( 2} for Q12025

Posted by Tanleechoo > 4 days ago | Report Abuse

Tqsm for sharing

Posted by Tanleechoo > 1 day ago | Report Abuse

Price go south ..? But coming qtr should be ok