LHI (6633) Overview - LEONG HUP INTERNATIONAL BERHAD

@speakup, not good to mislead fellow investors, this is a penalty (fine), there is no impairment per say, this amount previously was disclosure as a contingent liability but now since they lost the appeal, will be reflected in the coming quarter results

1 month ago

cheated

Why down 4 sen today if like nothing happened?

1 month ago

cheated

What if the fine keep continue and not 1 off? Flood in many places sure govn need money.

1 month ago

trader808

1. All these while since 2023 when the appeal proceeding is still on going, Leong Hup has treated the legal penalty as a Contingent Liability. Hence it is placed and categorized as an off-balance sheet item.

2. when it is place as an off-balance item, the penalty and payment is assumed to be 50%/50% chance and hence payment is only considered possible -> Disclose a contingent liability.

3. Last Friday LHI in its filing with Burse confirmed CAT has rejected its appeal and uphold the MYCC verdict and the payment of 157m penalty.
When this happened, the penalty has become greater than 50% and the payment is highly probable.

4 Going forward LHI may have to respect the verdict, recognize the penalty and makes a provision and charge it against profits in P/L accounts.

5 Despite the decision, the Company together with its legal team still try their best with determination to downplay the situation. Actually, the legal notice by MyCC has been issued since 2023, but Leong Hup has continued to disclose it only as a contingent liability up to the latest quarter.

6 IMPORTANT NOTE (in December 2024 latest news):
Competition Appeal Tribunal (CAT) has rejected the request by LHI's subsidiary, (LFM) to pause or temporarily stop ("stay") the enforcement of the fine. This means that as of now, LFM is STILL REQUIRED TO PAY THE PENALTY.

7LHI in its filling with Bursa again to inform investors it intends to seek another type of temporary relief known as ad-interim to stop the enforcement of the fine while the review is ongoing. There is no guarantee that the review is forthcoming.

8 In my opinion, the payment of penalty seems highly probable now considering the latest news and decision by CAT. Auditors are RISK-AVERSE and will definitely require a provision to be recognized in the coming quarter results. In the end as much as we may not like it but a fall in profits by the provisional amount of RM157m is reasonably expected.

9 This has been a disturbing news for LHI and Market has reacted somewhat negatively. It is now traded at 60sen down 4 sen.

10 This is my personal perception and opinion on LHI.
This is not a recommendation to buy or sell and much less intended to influence your strategy and decision.

11 Happy trading
9/12/2024

1 month ago

Go to high court just like GRAB against MyCC. GRAB won the case. So this is expected with LHI to all the way to High Court.

1 month ago

warchest

we have precedent like the case of Grab. LHI just need to file in application of judicial review with Court of Appeal. Eventually Grab won. Just keep fighting

1 month ago

refer to the evidence shared by MyCC (including messages), then only u can make informed decision

1 month ago

GLNT

Share buybacks incoming. First time ever in history

1 month ago

Have to see the context of the messages. Peers in any industry always in communication. If their conversation is about cost of corn and soybeans are going up. That's just stating facts. As peers and also competitors, conversation on HOW MUCH they are increasing their price is like revealing their secret and no experience business people will do especially on commoditize products. Pricing is their advantage.

Ravetidus

refer to the evidence shared by MyCC (including messages), then only u can make informed decision

1 month ago

GLNT

Share buybacks everyday, following Shin Yang?

1 month ago

PPB has filed judicial review against MyCC. How about LHI ...?

1 month ago

markgold

Be greedy when others are fearful.

1 month ago

warchest

It is undervalued. They have the regional exposure not only in Malaysia but all the major jurisdictions in ASEAN, catering over 700mil population. just started their share-buy back but already purchase >5mil shares - more to go. Even the worst outcome - they need to commit to the fine of RM155mil, within a quarter they already settled it with their strong free cashflow

1 month ago

protoking

big big selling pressure, see whether they can withstand

1 month ago

GLNT

Boss happily buys 3mil shares everyday

1 month ago

The company buys back shares, not the boss

4 weeks ago

There are many benefits to a company buying back its own shares, including:
Increased earnings per share (EPS)
Repurchasing shares lowers the capital base, which increases EPS. This can make a company's earnings growth appear better than it actually is.
Higher dividend yield
After a share buyback, a company can benefit from a higher dividend yield.
Attracting new investors
A buyback can boost a stock's EPS, which can reduce its P/E ratio. This can make the stock appear more attractive to new investors.
Rewarding shareholders
A buyback allows a company to return money to shareholders, especially if the company believes its shares are undervalued.
Tax efficiency
A share buyback can be taxed at a lower rate than dividends.
Defense against hostile takeover
A company can use a share buyback to create a defense plan against a hostile takeover.
Offsetting stock-based compensation
A company can use a buyback to cover up stock issuance to managers, which dilutes shareholder ownership.
Efficient use of cash
A company with substantial cash reserves can efficiently use its money by buying back shares.

4 weeks ago

stevenckheng

so much treasury share, gonna issue bonus and warrant ?

4 weeks ago

speakup

Likely share dividend coming

4 weeks ago

Share dividend will not subject to 2% tax right?

4 weeks ago

gankm

5 years ago the IPO price is $1.10, now the price is only $0.60. As long as the share price cannot goes above $1.10, LHI definitely a bad company with bad management that only care for themself and their own pocket.

3 weeks ago

trader808

1.In 2019 LHI has IPO up to 937.5m shares of which 687.5m shares were offered for sales and the remaining 250m shares were public issue of new shares to institutions and the investing public.

2. The scheme of the IPO also means that the owner has cash out 687.5 x 1.10 = RM 756.25m immediately after listing. Hence, with that kind of fortune , it is not surprising that they care little about the company share price performance.

3. Despite its remarkable and commendable profit performance of 218m in 2022 and 301m in 2023 and the 9 month cumulative profit of 288m in 2024, the counter is trading at an absurdly disheartening PE of 5.8x with the share price as low as 59sen. That is a disastrous collapse of 46% from its IPO with little sign of recovery in the near future.

4 In addition, the company is now burdened with a penalty of 157m fines by MYCC. Until this is resolved and paid, the bears will continue to charge and push down the share price.

5 Management has come to its sense and come forward to defend its falling share price by aggressively buying back its own shares. Company has engaged in daily share buy back in multiple millions of shares to avoid a serious fall.

6 LHI is a somewhat dividend stock and it has a dividend policy to pay out a high percentage of its profit after tax. In 2014 it paid out 0.0145 plus 0.013 or 0.0275 dividend per share. The company has 3650m shares and hence it paid out 3650m x 0.0275 = RM100.4m In the unfortunate event of penalty and settlement, shareholders may have to scarify and forgo the dividend. Just a guess and may not be true.

7. The LAU family owns more that half of the company arising from the enlarged capital during IPO so the family collects more than RM50m in dividend yearly. Again. it is something they would seriously think about very hard.

8. The ongoing problem with MYCC is a temporary setback. However, until this is settled, I think the bears will continue to bash down the share price. Bad days have arrived and the worse days are still forthcoming.

9 LHI is riding on a rough patch and journey into muddy water. Nevertheless, i still strongly believe LHI will recover spectacularly once the penalty issue is settled.

10 Every cloud has a silver lining. Every unpleasant situation has a positive side to it.
You may now or going forward collect LHI at incredibly low price and profit from it.

11. Opportunity may knock on your door.
Wait patiently and trade wisely
25/12/2024

3 weeks ago

accumulating...................

3 weeks ago

then hold tight .......................

3 weeks ago

Who will win? MYCC or Leong Hup ?

3 weeks ago

win win

3 weeks ago

Kevin Tam

The penalty of Rm150 already reflected at LHI share prices in past 2 months plus n this one off penalty will not affect its profitability much, market n retail investors have been overreact for this penalty issue. With undemanding valuation at below 61cents, investors should buy in at this moment (you make your own decisions though)...

3 weeks ago

Factors to consider before investing:
1) Strength of USD vs MYR;
2) Rising corn and soybean price recently (which forms about 50% and 25% of feed costs respectively);
3) Bird flu outbreaks around the world;
4) Potential reversal of MyCC decision thru court battle (long term)

3 weeks ago

@chipee, after u read the chat evidence posted at MyCC website then u know whether they are discussing about the rising costs of corn and soybean prices or pakat pakat issue invoices within same period at same price

3 weeks ago

You have the link to the chat website?

Ravetidus

@chipee, after u read the chat evidence posted at MyCC website then u know whether they are discussing about the rising costs of corn and soybean prices or pakat pakat issue invoices within same period at same price

2 weeks ago

Leong Hup's Q4 results will be good

https://www.bernama.com/en/business/news.php?id=2377026

2 weeks ago

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2 weeks ago

So they still need to pay the fine, just the date is postponed ... ?

1 week ago

Obviously, this counter manipulates the share price itself, never care about the investors. after they gain enough money from investors, they will delist frm
board.

1 week ago

Rubbish

1 week ago

speakup

Scammer dah mali i3

1 week ago

No matter how much money in single quarter , the share price will never up, there must be somethings behind it, so don make any illusions on this counter. i hv been holding it since its IPO, from average price 0.94 then 0.88 , 0.78 , 0.70 and latest AP at 0.68, Every time i bought it with positive mindset. but the price’s nvr been positive, losing more and more and more. time to let it go and nvr look bk.

1 week ago

gankm

yes, totally agree with Meowmeowbibi. Leong Hup International is a rubbish company. Those Lau family who is sitting in the board of director are con man.

6 days ago

protoking

probably investor in the end pay for their fine...

4 days ago

when US and Asia market drop, LHI follows the trend, but why when Us and Asia market up, LHI never follows, anyone telles me why.

4 days ago

No one can explain or describe this irrational stock, dude

3 days ago

0.560 0.51 0.49 0.45 then up to 0.50 everyone is happy then buy again, buy buy buy then harvest again.

2 days ago

over and over again…. then the director make a announcement to delist, buy the share from share holders at the price of Rm0.510… The family 袋袋平安。

2 days ago

Nice script. When are they gonna execute the plan? 😆

17 hours ago