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Thursday, June 30, 2011

CATCHA MEDIA BERHAD IPO

CATCHA MEDIA BERHAD IPO Price RM0.75

Opening of application : 30/06/2011
Closing of application or subscription : 08/07/2011
Balloting of applications : 12/07/2011
Allotment of IPO shares to successful applicants  : 19/07/2011
Tentative listing date : 22/07/2011

Issuing house MIH 522
ACE Market 

INITIAL PUBLIC OFFERING IN CONJUNCTION WITH OUR LISTING ON THE ACE MARKET OF BURSA MALAYSIA SECURITIES BERHAD (“BURSA SECURITIES”) COMPRISING:
(I) PUBLIC ISSUE OF 23,000,000 NEW ORDINARY SHARES OF RM0.10 EACH (“SHARES”) ALLOCATED IN THE FOLLOWING MANNER:
• 20,000,000 SHARES MADE AVAILABLE FOR APPLICATION BY WAY OF PRIVATE PLACEMENT TO IDENTIFIED INVESTORS; AND
• 3,000,000 SHARES MADE AVAILABLE FOR APPLICATION BY THE MALAYSIAN PUBLIC
(II) OFFER FOR SALE OF UP TO 11,000,000 SHARES MADE AVAILABLE FOR APPLICATION BY WAY OF PRIVATE PLACEMENT TO IDENTIFIED INVESTORS
AT AN ISSUE PRICE/OFFER PRICE OF RM0.75 PER SHARE, PAYABLE IN FULL UPON APPLICATION.


Free Malaysia Today
June 30, 2011 KUALA LUMPUR: Catcha Media Bhd, en route for a ACE Market listing on July 22, expects to raise RM17.5 million from its initial public offering (IPO).
“We have set aside about RM13.15 million of the proceeds for working capital, RM2 million for research and development and the remaining RM2.1 million will be used to fund listing expenses,” it said in a statement today.

Catcha Media, a media owner and operator of a business magazine and online media, aims to list 23 million new ordinary shares at 75 sen per share, where three million shares have been offered to the Malaysian public and 20 million shares have been alloted for private placement.
Moving forward, Catcha Media seeks to expand by way of acquiring more representation and sales rights for local and international online properties, while leveraging its magazine publishing business to grow its online media business.

“We believe Catcha Media has very strong prospects, given its leading position in the online media industry,” said director and founder Patrick Grove.
Based on a Frost & Sullivan study, Catcha Media garnered 26.62% share of Malaysia’s online advertising market last year. - Bernama

More info on recent IPO here.
http://politemarket.blogspot.com/search/label/IPO

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HIBISCUS PETROLEUM BERHAD IPO

HIBISCUS PETROLEUM BERHAD IPO price RM 0.75
Opening of application : 30/06/2011
Closing of application : 13/07/2011
Balloting of applications : 15/07/2011
Allotment of IPO shares to successful applicants  : 19/07/2011
Tentative listing date : 25/07/2011
Issuing house EQS 644
Main Market

PUBLIC ISSUE OF BETWEEN 200,000,000 AND UP TO 400,000,000 NEW ORDINARY SHARES OF RM0.01 EACH IN OUR COMPANY (“PUBLIC ISSUE SHARES”), TOGETHER WITH BETWEEN 200,000,000 AND UP TO 400,000,000 FREE DETACHABLE WARRANTS (“WARRANTS-A”) ON THE BASIS OF 1 WARRANT-A FOR EVERY 1 PUBLIC ISSUE SHARE SUBSCRIBED, AT AN ISSUE PRICE OF RM0.75 PER PUBLIC ISSUE SHARE PAYABLE IN FULL UPON APPLICATION COMPRISING:
• BETWEEN 190,000,000 AND UP TO 390,000,000 PUBLIC ISSUE SHARES TOGETHER WITH BETWEEN 190,000,000 AND UP TO 390,000,000 WARRANTS-A ON THE BASIS OF 1 WARRANT-A FOR EVERY 1 PUBLIC ISSUE SHARE SUBSCRIBED BY WAY OF PLACEMENT TO SELECTED INVESTORS;
• 10,000,000 PUBLIC ISSUE SHARES TOGETHER WITH 10,000,000 WARRANTS-A ON THE BASIS OF 1 WARRANT-A FOR EVERY 1 PUBLIC ISSUE SHARE SUBSCRIBED AVAILABLE FOR APPLICATION BY THE MALAYSIAN PUBLIC;
IN CONJUNCTION WITH OUR LISTING ON THE MAIN MARKET OF BURSA MALAYSIA SECURITIES BERHAD.

-----------
Business Times 30 June 2011
Hibiscus Petroleum Bhd will utilise its initial public offering (IPO) proceeds of between RM150 million and RM300 million to acquire stakes in one to three oil and gas exploration and production (E&P) companies.
"We intend to only venture into E&P opportunities, from low to moderate risk onshore opportunities and low risk shallow water offshore opportunities that have high upside potential," said Managing Director Dr Kenneth Pereira after launching the company's IPO prospectus here today.

Hibiscus Petroleum, the first special purpose acquisition company (SPAC) to be listed on Bursa Malaysia, is scheduled for listing on the Main Market on July 25.

It aims to take up 30 to 40 per cent stake in each target company in a deal valued less than RM100 million.

An SPAC company is a company that is initially listed with no operations but is formed exclusively to make acquisitions using cash raised from its IPO.

Under the Securities Commission guidelines, 90 per cent of the fund raised would be placed in trust account, and the acquisitions must have an aggregate fair market value equal to at least 80 per cent of the amount in the trust account.

An SPAC that fails to make acquisitions within three years must be liquidated.

Pereira said: "A third party market research has identified 62 possible deals in the South Asia, Middle-East, East Asia and Oceania regions that Hibiscus could afford based on its IPO.

"And out of these, 13 could generate revenue within the next two years or less."

He said the company would become the first Malaysian-listed oil and gas E&P independent company and hoped to create value mainly through knowledge and experience of the board and management team.
Hibiscus' IPO entails a public issue of between 200 million and up to 400 million new ordinary shares together with free detachable warrants on the basis of one warrant for every one public issue share subscribed, at an issue price of RM0.75 per share.

The public issue comprises between 190 million and up to 390 million shares by way of placement to selected investors and 10 million shares made available for application by the Malaysian public.
Hong Leong Investment Bank Bhd is the principal adviser for the underwriting of the balloting portion to be made available for application by the public. -- Bernama


More info on recent IPO, here.
http://politemarket.blogspot.com/search/label/IPO

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Bumi Armada IPO

Bumi Armada Berhad was listed in KLSE. It was privatised and delisted in 2003 by T. Ananda Krishnan.

IPO price RM 3.15, or the Institutional Price, whichever is lower, subject to a refund of the difference between the Final Retail Price and RM3.15 per Share.

Opening of application : 30/06/2011
Closing of application : 07/07/2011
Balloting of applications : 11/07/2011
Allotment of Bumi Armada IPO shares to successful applicants  : 19/07/2011
Tentative listing date : 21/07/2011
MIH 520 Main  Market


INITIAL PUBLIC OFFERING OF UP TO 878,538,600 ORDINARY SHARES OF RM0.20 EACH IN BUMI ARMADA BERHAD ("BUMI ARMADA") ("SHARES") COMPRISING:
(I) OFFER FOR SALE OF UP TO 234,277,000 EXISTING SHARES ("OFFER SHARES") COMPRISING:
• THE INSTITUTIONAL OFFERING OF UP TO 234,277,000 OFFER SHARES TO BUMIPUTERA INVESTORS APPROVED BY THE MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY ("MITI") AT THE INSTITUTIONAL PRICE TO BE DETERMINED BY WAY OF BOOKBUILDING ("INSTITUTIONAL PRICE"); AND
(II) PUBLIC ISSUE OF UP TO 644,261,600 NEW SHARES ("ISSUE SHARES") COMPRISING:
• THE INSTITUTIONAL OFFERING OF UP TO 564,400,200 ISSUE SHARES TO MALAYSIAN AND FOREIGN INSTITUTIONAL AND SELECTED INVESTORS, INCLUDING BUMIPUTERA INVESTORS APPROVED BY MITI AT THE INSTITUTIONAL PRICE; AND
• THE RETAIL OFFERING OF 79,861,400 ISSUE SHARES TO THE MALAYSIAN PUBLIC, THE DIRECTORS OF BUMI ARMADA, AND ELIGIBLE EMPLOYEES AND PERSONS WHO HAVE CONTRIBUTED TO THE SUCCESS OF BUMI ARMADA AND ITS SUBSIDIARIES AT THE RETAIL PRICE OF RM3.15 PER SHARE ("RETAIL PRICE"), PAYABLE IN FULL UPON APPLICATION AND SUBJECT TO A REFUND OF THE DIFFERENCE IN THE EVENT THAT THE FINAL RETAIL PRICE IS LESS THAN THE RETAIL PRICE,
SUBJECT TO THE CLAWBACK AND REALLOCATION PROVISIONS. THE FINAL RETAIL PRICE WILL EQUAL THE LOWER OF (I) THE RETAIL PRICE; AND (II) THE INSTITUTIONAL PRICE.

________
Business Times 30 June 2011
Offshore oil and gas services provider, Bumi Armada Bhd, which aims to raise RM2.029 billion from its initial public offering (IPO), has an order book of RM5.8 billion as at June 1, 2011.

Its executive director/chief executive officer, Hassan Assad Basma, said the majority of the firm's contracts on its order book also contained extension options, with a potential total value of RM2.5 billion.

"Bumi Armada is a growth story and we forecast continued growth. As such, we have a good pipeline of future projects. "In floating production, storage and offloading (FSPO), we are busy tendering for six projects now," he told reporters after the launch of the IPO prospectus here today.

The company, which is expected to be listed on July 21, 2011, is offering 644.26 million new shares at RM3.15 apiece. It will use the proceeds to repay bank borrowing, capital expenditure, working capital and listing expenses.

The listing is the largest in Malaysia this year and the second biggest listing in South-East Asia. After the IPO, the stake of Usaha Tegas Sdn, the parent of Bumi Armada, will be diluted to 43 per cent from 54 per cent previously.

Bumi Armada has secured cornerstone investors for its institutional offering, namely Great Eastern Life Assurance (M) Bhd, Permodalan Nasional Bhd, HwangDBS Investment Management Bhd, Prudential Fund Management Bhd, Hong Leong Assurance Bhd, Guoline Capital Ltd and Asia Foundation Investment Co Ltd.

They investors agreed to buy 300 million shares, or 10.2 per cent, of the company. On whether the institutional book would be closed early, a Maybank official said the management has not decided yet, adding that interest has been strong since the book opened on July 28.

Hassan Assad said Bumi Armada planned to increase its presence in existing markets as well as new markets in Latin America, Africa and Asia in the next two to three years.

"It could be either on a strategic or opportunistic basis. "We will evaluate new markets as and when opportunities arise. However, we anticipate to increase our presence in existing markets including Angola, Brazil, Venezuela, India and Vietnam," he said.

He said 84.8 per cent of the company's revenue for financial year 2010 and 67.7 per cent for first quarter ended March 31, 2011 were derived from outside Malaysia.

Hassan Assad said Bumi Armada aimed to be the fourth largest FSPO player in the world in terms of fleet size by end-2013, adding that the company's plan was to have one FSPO yearly.

Bumi Armada is Malaysia's largest owner and operator of offshore vessels with about 50 vessels. For the year ended Dec 31, 2010, it recorded a net profit of RM351 million and earnings before interest, tax, depreciation and amortisation (EBITDA) of RM714 million.

For the three months ended March 31, 2011, its net profit was RM82 million and EBITDA RM185 million. Its revenue for financial year 2010 was RM1.241 billion while revenue for the first quarter ended March 31, 2011 was RM376 million. -- Bernama

More info on recent IPO, here.
http://politemarket.blogspot.com/search/label/IPO


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Wednesday, June 29, 2011

Muhibbah stock a trading buy

CIMB recommend a trading buy on Muhibbah Engineering shares. Let us look at Muhibbah analysis before we decide whether can consider or not.

At Muhibbah share price of RM1.39.
Year 2010 ,   2011 ,   2012 ,   2013
EPS   RM0.085 ,   RM0.182 ,   RM0.204 ,   RM0.227
Muhibbah PE Ratio 16.4x ,   7.7x ,   6.8x  ,   6.1x
Growth    214% (2011), 12% (2012), 11% (2013)
Net gearing about 50%
Dividend yield 2.9% (2011)
Figures: CIMB, with Muhibbah target price fair value RM2.75


Kenanga Research said Muhibbah may have potential losses due to APH issues and could lead the company into PN17 status as the severe losses would erode its shareholders fund by more than 75 per cent. "We believe this is less likely to be the case as the company may not need to write down the full amount of RM370 million," the research house said.

Based on the figures by CIMB, I don’t think they have incorporated the potential loss into Muhibbah Engineering because at this moment, things are still not sure.

In my opinion, if we buy into Muhibbah, we are buying into news. If APH got good news, then Muhibbah share price will go up. I think most of us also not sure what will happen to APH case. Up to individuals to decide.

--------------------------------------

27 June 2011 CIMB
After the APH travails, the award of the RM338m Northport extension contract to Muhibbah was a slight welcome surprise and an indication of the group’s strength and niche in port/marine related infrastructure works. Contributions from this project will amount to 5-9% of FY11-13 net profit. However, we make no changes to our numbers as it is part of the RM1bn new contracts that we have assumed for 2011.

Although APH’s receivership remains an overhang, we maintain our TRADING BUY
call and target price of RM2.75, which we continue to base on a 10% RNAV discount.
This award, a likely positive outcome for APH and more contract wins are potential
catalysts for the stock which has collapsed 27% since the APH news made headlines.

---------------------------------------

Recent Muhubbah developments from The Star and CIMB 17 June 2011.
News that Asia Petroleum Hub (APH), a big client that owes money, was in receivership.

CIMB Research said the receivership status for the APH project as reported by a foreign newspaper on Wednesday was a negative surprise.

APH had been put under receivership mainly because it could not come up with other investors to help fund the development and repay its debt.

APH is likely to negotiate for more time to resolve the matter and rope in a new investor.
The news said APH had secured in 2006 a RM1.4bil three-year bridging loan but has been looking for RM2bil in additional funding following escalation of the project cost.
It has been placed under a receiver -Malaysian accounting firm BBDO-Binder.

“Receivership status typically involves a temporary transfer of control from the management to the appointed receiver.

“On the status of a potential new investor, we understand that APH is still in talks, probably with a new foreign party, which would pump in the funds needed to restart the projects.

“The indicative timeline is towards end-2011,” CIMB Research said.

As one of the contractors for APH, Muhibbah was awarded marine piling and jetty works worth RM820mil.

The research house said cost escalation in 2008 led to funding issues for APH and the stalling of payments to Muhibbah Engineering.

“The unpaid amount has accumulated to RM300mil, which does not include RM187mil worth of outstanding work as at end-2010.

“Muhibbah Enginering had not made any provisions for the project as the project is still deemed viable,” the research house said.

It added that the worst case scenario for Muhibbah was a write-down of the RM300mil due from APH, which would push Muhibbah Engineering into losses for FY11.
“However, we believe that in a scenario where the receiver takes over the management of APH, it may come up with a scheme to repay a large portion of the amount due to contractors.

“This would reduce the risk of a huge write-down,” it said.

While this latest development was a disappointment, the research house said it was not overly concerned as Muhibbah Engineering's fundamentals were still intact, backed by a buoyant construction and oil & gas sector.

CIMB Research continues to rate Muhibbah Engineering a “trading buy” and remains one of its top picks for the construction sector.


More info on Muhibbah
http://politemarket.blogspot.com/search/label/Muhibbah


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Inari Berhad IPO

Opening of application : 28/06/2011
Closing of application : 07/07/2011
Balloting of applications : 11/07/2011
Allotment of Inari Berhad IPO shares to successful applicants  : 18/07/2011
Tentative listing date : 19/07/2011
Issuing house Equiniti 643
ACE Market

INITIAL PUBLIC OFFERING IN CONJUNCTION WITH OUR LISTING ON THE ACE MARKET OF BURSA MALAYSIA SECURITIES BERHAD COMPRISING PUBLIC ISSUE OF 83,000,000 NEW ORDINARY SHARES OF RM0.10 EACH (“SHARES”) IN INARI BERHAD COMPRISING:
• 10,000,000 SHARES MADE AVAILABLE TO THE MALAYSIAN PUBLIC;
• 26,154,000 SHARES BY WAY OF PRIVATE PLACEMENT TO IDENTIFIED INVESTORS;
• 36,460,000 SHARES BY WAY OF PRIVATE PLACEMENT TO IDENTIFIED BUMIPUTERA INVESTORS APPROVED BY THE MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY; AND
• 10,386,000 SHARES MADE AVAILABLE TO OUR ELIGIBLE DIRECTORS, EMPLOYEES AND PERSONS WHO HAVE CONTRIBUTED TO THE SUCCESS OF INARI BERHAD AND OUR SUBSIDIARIES.
AT AN ISSUE PRICE OF RM0.38 PER SHARE PAYABLE IN FULL ON APPLICATION

About Inari Berhad (Source: Inari)
Inari Berhad is an investment holding company with subsidiaries involved in the electronics manufacturing services (EMS) industry. The Inari Berhad Group started in June 2006 with the establishment of Inari Technology Sdn Bhd (Inari Technology). Inari Technology is an EMS company principally involved in back-end semiconductor packaging, which comprises back- end wafer processing, package assembly and RF final testing for the electronics/semiconductor industry. Inari Technology’s customers are primarily in the wireless communication segment.


Inari Technology’s capabilities are not limited to the wireless microwave telecommunication semiconductor segment; Inari Technology is also capable of manufacturing the entire range of semiconductor products for other segments of the semiconductor industry.

Board of Directors of Inari Berhad

1) Y. A. M. Tengku Puteri Seri Kemala Pahang Tengku Hajjah Aishah bte Sultan Haji Ahmad Shah,
    DK(II), SIMP. 
2) Dato’ Thong Kok Khee 
3) Dato’ Wong Gian Kui 
4) Dr. Tan Seng Chuan 
5) Mai Mang Lee 
6) Ho Phon Guan 
7) Tan Lee Pang S/O Hum Beng 
8) Ooi Boon Chye 
9) Oh Seong Lye 
10) Rajendran A/L Velayuthan 
11) Foo Kok Siew 

Management Team Site

The Senior Management Team comprise of personnel who have vast experience in the related fields. 
1) Mr Herman Tan (General Manager - Finance, 15 years of experience) 
2) Mr Daniel Lim (Financial Controller, 22 years of experience) 
3) Mr FT Cheang (Senior Operation Manager - Test, 28 years of experience) 
4) Mr BK Tan (Operation Manager - NPI & Marketing, 20 years of experience) 
5) Mr James Tan (Operations Manager - Assembly, 19 years of experience) 
6) Mr KH Chew (Manager - R&D, 21 years of experience) 
7) Mr EL Chai (Head Of Department, 21 years of experience) 
8) Mr Govindarajoo (Operation Manager - Wafersort, 21 years of experience) 
9) Mr Geoffry Tan (Senior Manager - Operation (SMT/FA), 16 years of experience) 

More info on recent IPO.
http://politemarket.blogspot.com/search/label/IPO

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Prestariang Berhad IPO

Prestariang Berhad 28-06-11
Opening Date of application 28-06-2011
Closing date of IPO 15-07-11
Prestariang IPO price RM 0.90
Balloting of applications : 19/07/2011
Allotment of IPO shares to successful applicants  : 22/07/2011
Issuing house MIH 518
Main Market
Tentative Listing Date 27-07-11

PUBLIC ISSUE OF 22,000,000 NEW ORDINARY SHARES OF RM0.10 EACH AVAILABLE FOR APPLICATION BY THE MALAYSIAN PUBLIC; AND
OFFER FOR SALE OF 77,000,000 ORDINARY SHARES OF RM0.10 EACH COMPRISING:-
• 8,000,000 ORDINARY SHARES OF RM0.10 EACH AVAILABLE FOR APPLICATION BY THE MALAYSIAN PUBLIC;
• 7,000,000 ORDINARY SHARES OF RM0.10 EACH AVAILABLE FOR APPLICATION BY ELIGIBLE DIRECTORS, EMPLOYEES, AND BUSINESS ASSOCIATES OF PRESTARIANG BERHAD AND ITS SUBSIDIARIES;
• 22,000,000 ORDINARY SHARES OF RM0.10 EACH AVAILABLE FOR PRIVATE PLACEMENT TO BUMIPUTERA INVESTORS APPROVED BY THE MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY; AND
• 40,000,000 ORDINARY SHARES OF RM0.10 EACH AVAILABLE FOR PRIVATE PLACEMENT TO SELECTED INVESTORS;
AT AN ISSUE/OFFER PRICE OF RM0.90 PER ORDINARY SHARE PAYABLE IN FULL ON APPLICATION IN CONJUNCTION WITH THE LISTING OF PRESTARIANG BERHAD ON THE MAIN MARKET OF BURSA MALAYSIA SECURITIES BERHAD.

ABOUT PRESTARIANG
Incorporated in 2003, the Company’s core business is to train and certify lifelong learners to become professionals. Focusing on ICT training and certification, and software licence distribution and management, we aim to impart knowledge, skills and attitude to make a person gain initial employment, maintain it and obtain new ones if required through globally benchmarked accreditation.

Our two core business activities are highly synergistic, where we commonly provide ICT training and certification together with the supply of licences for the software that we are training and certifying.

As a certified partner for various technology and software vendors and organisations, we have the capability to provide both basic and professional ICT training and certification encompassing instructor-led courses and certification examination at the end of the course. At the same time we are able to distribute and manage their software licences.

Currently, we offer approximately 40 certification courses from various technology and software vendors who are our valued partners including Microsoft, IBM, Oracle, Sun Microsystems, CompTIA, Autodesk, EC-Council, Adobe and others.

Prestariang is a Bumiputra-owned MSC Malaysia-status company and a registered ICT contractor with Ministry of Finance.

Source: Prestariang

 More info on recent IPO:
 http://politemarket.blogspot.com/search/label/IPO


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Tuesday, June 28, 2011

Oldtown Berhad Stock Target Price Fair Value

Let us look at Oldtown research analysis before we decide whether to apply or subscribe Oldtown IPO.

Using Oldtown IPO price of RM1.25.

Oldtown PE Ratio is 12.9x (2010).
Growth forecast 7% to 14% per year for the next two years.
No net gearing.
Oldtown dividend yield is about 4% to 4.5%
Oldtown dividend payout ratio policy is 50%.

Let us look at Oldtown analyst comments:
TA Securities derive to a fair value of RM1.33 based on sum of parts valuation. This implies a total return of 10% including the 4% dividend yield. Thus, they recommend investors not to subscribe Oldtown shares due to limited capital upside, as the Oldtown fair value is only RM1.33.

HwangDBS Vickers asked to Subscribe for a 20 per cent upside potential. They arrive at  RM1.50 Oldtown fair value based on a P/E multiple of 12x on FY12F EPS of 12.5 sen. Compared with its two locally listed peers, the target P/E valuation represents a discount to KFC (P/E of 16x) and a premium to Berjaya Food (P/E of 9x). This partly reflects Old Town’s market-cap size of RM495 million (based on our fair value of RM1.50) vis-à-vis KFC’s RM3.1 billion and Berjaya Food’s RM119 million.


Background of Oldtown (Source: TA)
Cofounders, Mr Goh Ching Mun and Mr Tan Say Yap, can trace the group’s history back to the incorporation of White Café in 1999. Both founders formulated their own blend of 3in1 instant white coffee and commenced operations in 1999 which led to the commercialization of its 3in1 instant coffee under the brand name “Oldtown”.


(Source: Malaysian Insider and Hwang)
Manufacturer of “OLDTOWN” instant beverages and the operator of the “OLDTOWN WHITE COFFEE” kopitiam-based café outlet chain.

First shop in 2005.  Now has 182 café outlets in Malaysia, Singapore and Indonesia. 2011 will add 38 more outlets (of which 14 are already in operation) and total will be 206.
Add 31 shops in 2012. Half of the outlets are either fully owned or partially owned outlets, and the other half are franchised.

The café chain operation contributes more 65% per cent of FY10 net profit and the beverage manufacturing segment 35%.

Each fully owned outlet is projected to generate about RM1 million a year in revenue, though the initial contributions will be lower. Hwang expect the growing network of café outlets to lift total revenue to RM300.6 million  (+18 per cent y-o-y) in FY11 and RM349.5 million (+16 per cent y-o-y) in FY12, translating to a two-year net profit CAGR of 14 per cent to RM41.4m.

High-dividend payout expectations
Old Town has set a minimum dividend payout policy of 50 per cent of its gross earnings for FY11 and FY12. Based on our forecasts, net DPS works out to be 4.1 sen this year and 4.7 sen next year, which translates to dividend yields of 3.3 year and 3.8 years respectively. We believe Old Town is in a position to sustain the high dividend payout expectations given its healthy balance sheet, with net cash balance projected to rise from RM14.4 million (or 4.4 sen per share) after the listing to RM34.8 million (or 10.6 sen per share) by end-FY12.

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52 Ways of Making Money in Stock Market - Part 16/52 - Invest in IPO

You can actually "APPLY' IPO Initial Public Offering and sell it on the listing day and make money (if the selling higher than the IPO price).
I still remember many years back, most of the IPO can make more than 10% gain on the first day of listing. You apply and if you strike the IPO, means you probably have made money.
Another benefit of applying IPO is the price may continue to go up after listing. Example QL Resources IPO price is $2.50 and after 10 years (with Bonus issue, etc) it is worth more than $33.00. More than 13 times. If you add the dividend, it will be more. This is because some company need money to grow, so they have IPO to get fund. As long as the company keep growing, the share price will continue to grow.

During the first day listing of the IPO, there will be heavy volume traded. So the price is very volatile. Some may want to do day trade during that day.

Some IPO price went up crazy on the first day of listing.

RISKS, LIMITATIONS OR DIFFICULTIES:
But now not all IPO trade above the IPO price. Most are disappointed. You may have to be selective. There was once the broker recommend to subscribe but the stock trade below IPO price. Another IPO the broker recommend not to subscribe, but the stock trade above IPO price.

There are also situation when the share price trade above the IPO price but you didn’t strike the IPO. The IPO that you strike, it trade below the IPO price.

You may not get all the shares that you apply. Example if you apply 10,000 shares, you may get 6,000 shares only.


OPINION:
Be selective and follow market sentiment. Get more information and seek advise from different sources.

For more info on IPO and 52 Ways of Making Money in Stock Market……..

Monday, June 27, 2011

How your wife can help you in stock market

How your spouse (husband or wife) or your partner (boyfriend or girlfriend) can help you in stock market? They do not have your weaknesses and may perform better than you. How this can be achieved? Let us look at our common weaknesses.

Greedy, too emotion, didn't buy when stock market is at rock bottom, fall in love with certain stock, didn't follow fundamental, didn't cut loss, etc, are some of our common weaknesses.

This is how your spouse can help.

You first develop an investing objective and a plan, and your spouse MUST follow the plan strictly. Do not blame your spouse if the decision is wrong because you are the one that set the rules.

What to buy?
Example you wish to invest counters with low PE and high growth and high dividend yield. You then select some good counters that have low PE ratio, high growth and dividend, and present to your spouse. Explain a bit on each counters the potential and risk.

Your spouse will select a counter and key-in the order at a price for you. Or he/she may ask you to key-in at certain price. You cannot question your spouse.

By doing this, you will avoid bias. Although some counters have very good fundamental, I have bias against them, that is why I miss out on them. I hate construction, airline, tourism, industrial products. I love consumers and services. Some of us fall in love with certain stocks that we like to buy or refuse to sell.


When to Sell?
Set your cut loss threshold or when to take profit. Example you may wish to sell when a stock if it reach a PE ratio of 10x or 17x, etc. Or sell a blue chip when the forecast PE ratio reach 16x or 14x, or whatever figure that you have planned. Cut loss when the company's fundamental has changed and forecast low growth or may make losses.

Or you may want to set the selling if the share price above X % of the recommended fair value of most analysts.

Investment Amount.
You may wish to allocate $3000 per month, or $3000 per quarter for your spouse to invest, or whatever amount.


Review.
Every month, review the portfolio. Tell your spouse what is the updates of the stocks. If got any new major development on certain stock, brief your spouse immediately.


The above is just an example, and different investors may wish to have different objectives and plans.

Did I ask my spouse to execute the plan for me? No.

But I almost set a plan. Why? Last time my investment was not doing well because I involve too much emotion in my investment. Hate some stocks, love some stocks. Ignore the risk, refuse to cut loss, afraid to buy when stock market is low and cheap. Always sell when I make just 10%.

I feel that if I can follow straightly my own plan, I can perform much better. But the problem is I was unable to do so. I was thinking, my spouse is able to help me to execute my plan.

Thank God I become more discipline in end of 2009. Dollar Cost Averaging has helped me, and my own PEGGY Method also helps me a lot.

I also make sure that I review my own investment, and write down the weaknesses and not to repeat that again.

If you have the discipline, then you do the investment.

But if you have no discipline, then your spouse may be able to help you.


Click here on how to evaluate your trading and how to improve on it.
http://politemarket.blogspot.com/2010/12/how-to-improve-on-your-trading-or.html



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List of Dividend Payout Ratio stocks from Bursa Malaysia shares market

I have list down some counters with Dividend Payout Ratio. Dividend payout ratio is different from actual dividend in percentage of paid-up capital.

Example a counter with RM0.50 paid-up capital and made RM0.20 profit.
If they plan to pay out 40% as dividend, then they plan to payout 40% X RM0.20 = RM0.08.
This is just thier plan.
They may announce an actual 20% dividend, it means 20% of RM0.50 = RM0.10

Dividend payout ratio also different from dividend yield. Got time I will post this.


List of stocks with dividend payout ratio. Some of them are actual dividend policy, and some are a commitment or target made by the management.

Boustead 70%
MSM 50%
TSH 20% to 30%
PChem or Petronas Chemical 50%
UOA Development or UOADEV 30% to 50%
Tambun Indah Land Bhd stock 40% to 60%
Maxis 75% but paying more than that.

My previous list. I am not sure whether all are still valid because I did not get the update. But Freight and Zhulian are no change.

Topglove 40%
Mamee-Double Decker (M) Bhd 50%
Tecnic Group Bhd 50%
Homeritz Corporation Berhad 40%
Freight Management 40%
Zhulian 60%


More info on what is dividend payout ratio, here.
http://politemarket.blogspot.com/search/label/Dividend%20Payout%20Ratio

Why Dividend Payout Ratio is important?
http://politemarket.blogspot.com/search/label/Dividend%20Payout%20Ratio

More info on Bursa Malaysia Dividend Stocks.
http://politemarket.blogspot.com/search/label/Dividend


Malaysia Stock Market high dividend yield.
http://politemarket.blogspot.com/search/label/Dividend%20High%20Yield%20Stocks

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Saturday, June 25, 2011

Should we catch a falling knife in Bursa Malaysia Stock Market?

My friend once told me, we should NOT catch a falling knife in stock market. What is a falling knife? A falling knife means the stock price is falling. If a catch a falling knife physically, our hand will be full of blood. If we buy a stock when the price is falling, it will be the same, full of blood or full of red or full or losses.

Why? Because in stock market, more investors will tend to buy if the stock is on an uptrend and many will chase the stock. If the stock is on the way down, people will tends to sell and therefore, it will goes lower.

When a stock is falling, it will continue to fall and nobody know when is the bottom. This is also confirmed by the technical analysis, where if a stock is falling, it is a sell signal until it reaches a rebound buy signal.

1st conclusion.
Yes, what my friend told me is true. We should not catch a falling knife, and we should only buy when it is near bottom and about to rebound.

_______

But after few years of observing, I find that for some investors, it is actually a good idea to catch a falling knife. Let us look at the example on a good fundament stock.

Stock Price
RM3.00
Drop  to RM2.50 (Should we catch this falling knife?)
Drop to RM2.00 (Should we catch this falling knife?)
Drop to RM1.50 (not sure already bottom or not)
Went up to RM2.00
Went up to RM2.50
Went up to RM3.00
Went up to RM4.00
Went up to RM5.00


Investor N (NOT catching the falling knife)
Stock Price
RM3.00
Drop  to RM2.50 (Should we catch this falling knife?) Not buying
Drop to RM2.00 (Should we catch this falling knife?) Not buying
Drop to RM1.50 (not sure already bottom or not) not sure, so not buying
Went up to RM2.00 – went up already, not buying
Went up to RM2.50 – went up already, not buying
Went up to RM3.00 – went up so much already, forget it.
Went up to RM4.00
Went up to RM5.00


Investor C (catch the falling knife)
Stock Price
RM3.00
Drop  to RM2.50 (Should we catch this falling knife?) Yes, buy some.
Drop to RM2.00 (Should we catch this falling knife?) Yes, buy some
Drop to RM1.50 (not sure already bottom or not) Big loses, upset, so not buying
Went up to RM2.00 – went up already, not buying
Went up to RM2.50 – went up already, not buying
Went up to RM3.00 – went up so much already, forget it.
Went up to RM4.00
Went up to RM5.00



The above examples shows that Investor N, who does NOT want to catch a falling knife, missed out on the stock. But Investor C, who catch the falling knife, although initial was making huge losses, end up making gain.

My own conclusion.
Whether to catch a falling knife, there is no fixed answer. It can be good and it can be bad. The following are the factors that determine whether to catch or not to catch. The more of the following factors are met, the better to catch a falling knife.

1) the stock is a good fundamental stock. Although in short term may be losing money, but in long term will make money.
2) you are not good in trading and you don’t know when is the bottom or near bottom.
3) You like to que when buying stocks. When the stock is falling, chances of you manage to buy is higher even you are queuing to buy. If you buy when the stock recovers, you may not get it because you like to que and the stock price is getting higher. Better if you buy when it is coming down.
4) You are buying large quantity. When the stock is falling, you can easily buy large quantity without pushing up the price.
5) You will not buy a stock if the stock price has gone up. Therefore, it is better for you to buy when the stock price is falling. If you didn’t buy and the stock recovers, you will miss it because you refuse to buy.
6) You have cash or holding power.
7) You are doing averaging
8) The stock value is just too cheap.


Do NOT catch a falling knife if:
Opposite of the above points. Example is the stock is not good in fundamental, forever it may not recover. Or you don’t have holding power. Or you are so good in trading/ analysis that you know when is the bottom, etc.

What strategy do I use?
I am not good in trading or analysis, so I don’t know when is the bottom. Therefore, yes, I still catch a falling knife. But normally I don’t immediately buy it when it just started to fall. I’ll wait a while. And I also buy progressive using Dollar Cost Averaging method.


No fixed answer. Whether to catch or not to catch depend on individual’s trading pattern.


More on Dollar Cost Averaging.
http://politemarket.blogspot.com/search/label/Dollar%20Cost%20Averaging



Housing Loan
http://politemarket.blogspot.com/2010/11/malaysia-housing-loan-interest-rate.html


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Friday, June 24, 2011

Eversendai Corporation Berhad Final Retail Price

Subject : EVERSENDAI CORPORATION BERHAD
THE INITIAL PUBLIC OFFERING OF 232,190,000 ORDINARY SHARES OF RM0.50 EACH COMPRISING PUBLIC ISSUE OF 160,700,000 NEW SHARES AND OFFER FOR SALE OF 71,490,000 EXISTING SHARES IN CONJUNCTION WITH ITS LISTING ON THE MAIN MARKET OF BURSA MALAYSIA SECURITIES BERHAD 


Contents : MIH is pleased to announce that the Eversendai Corporation Berhad (“ECB”) IPO under which 20,000,000 shares were made available for application by the Malaysian public has been oversubscribed and the balloting of successful applications was conducted this afternoon. The Sole Bookrunner, Maybank Investment Bank, has confirmed that the Institutional Offering of 202,040,000 IPO Shares have been placed out to institutional and selected investors by way of bookbuilding. The Institutional Price has been fixed at RM1.70 per share. Accordingly, the Final Retail Price for the Retail Offering is fixed at RM1.62 per share and refund of the difference of RM0.08 (based on the Retail Price of RM1.70) will be despatched to successful retail applicants within 10 market days from the final ballot.

Institutional Price RM1.70
Final Retail Price RM1.62

A total of 11,994 applications for 165,195,300 shares were received from the Public for a total of 20,000,000 shares available for public subscription, which represents an oversubscription rate of 7.26 times.
All Notices of Allotment for these shares will be mailed to successful applicants on or before June 30, 2011.



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The World’s Top 10 Oil Producers in 2010

Producers, mmb per day,  % of world
Russia, 10.45, 12.0%
Saudi Arabia, 9.76, 11.2%
US, 7.80, 8.9%
Iran, 4.26, 4.9%
China, 4.10, 4.7%
Canada, 3.37, 3.9%
Mexico, 2.95, 3.4%
UAE, 2.87, 3.3%
Venezuela, 2.44, 2.8%
Nigeria, 2.44, 2.8%

World, 87.32, 100%

When we think of oil producer contries, we think of Arab nations.
But you can see, Russia, US and China are also in the top 5.
The big difference is, they are also the world's top oil consumers, so nothing much to export.

Articles that you may like,

Recent IPO
http://politemarket.blogspot.com/search/label/IPO

Trading in Forex
http://politemarket.blogspot.com/search/label/Forex

Worth to buy 4D?
http://politemarket.blogspot.com/2011/03/worth-to-invest-in-4d-or-stock-market.html

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MSM Malaysia Holdings Berhad Final Retail Price

Subject : MSM MALAYSIA HOLDINGS BERHAD
THE INlTIAL PUBLIC OFFERING ("IPO") OF 234,564,700 ORDINARY SHARES OF RM0.50 EACH IN MSM MALAYSIA HOLDINGS BERHAD ("MSM HOLDINGS") ("SHARES") COMPRISING OFFER FOR SALE OF 109,564,700 EXISTING SHARES ("OFFER SHARES") AND PUBLIC ISSUE OF 125,000,000 NEW SHARES ("ISSUE SHARES") IN CONJUNCTION WITH THE LISTING OF AND QUOTATION FOR 702,980,000 SHARES ON THE MAIN MARKET OF BURSA MALAYSIA SECURITIES BERHAD AT THE FINAL RETAIL PRICE OF RM3.38 PER SHARE AND THE INSTITUTIONAL PRICE OF RM3.50 PER SHARE.

Institutional Price RM3.50
Final Retail Price RM3.38

Contents : Equiniti Services Sdn Bhd ( formerly known as MIDF Consultancy & Corporate Services Sdn Bhd ("Equiniti") is pleased to announce that the Shares of MSM Holdings made available for public subscription have been oversubscribed.

For the 14,060,000 Issue Shares made available for public subscription, a total of 50,496 applications for 496,058,100 Issue Shares with a value of RM1,676,676,378.00 were received from the Malaysian public. This represents an overall oversubscription rate of 34.28 times.

Notices of Allotment will be dispatched by post to all successful applicants on or before 24 June 2011.

Source: Bursa Malaysia


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Thursday, June 23, 2011

Oldtown Berhad IPO

Oldtown Berhad IPO
Opening of application : 22/06/2011
Closing of application : 29/06/2011
Balloting of applications : 01/07/2011
Allotment of IPO shares to successful applicants  : 08/07/2011
Oldtown IPO price RM 1.25
Issuing house MIH 517
Main Market


Initial Public Offering of 96,394,000 Ordinary Shares of RM1.00 Each Comprising:-
63,394,000 New Ordinary Shares of RM1.00 Each Available For Application By The Malaysian Public, Directors, Eligible Employees And Business Associates Of Oldtown Berhad And Its Subsidiaries, Identified Investors And For The Ministry Of International Trade And Industry Approved Bumiputera Institutions And Investors; And
Offer For Sale Of 33,000,000 Ordinary Shares Of RM1.00 Each By Way Of Private Placement To Identified Investors
At An Issue/Offer Price Of RM1.25 Per Ordinary Share Payable In Full On Application Pursuant To Its Listing On The Main Market Of Bursa Malaysia Securities Berhad

-----------------------

31 May 2011 The Star
PETALING JAYA: In an updated prospectus draft, Oldtown Bhd is pricing its issue/offer price at RM1.25 per share for its initial public offering (IPO) of 96.4 million shares of RM1 each, instead of offering 59.5 million shares as stated in its first draft posted in February.

The company, which owns and operates the Oldtown White Coffee chain, aims to list on Bursa Malaysia's Main Market on July 11.

According to its prospectus draft, the company is offering 63.4 million new ordinary shares for application by the Malaysian public, directors, eligible employees and business associates of Oldtown and its subsidiaries.
The new shares are also offered to identified investors and bumiputra institutions and investors approved by the International Trade and Industry Ministry. It has an offer for sale of 33 million ordinary shares by way of private placement to identified investors.

The IPO price is based on the historical price earnings ratio multiple for the financial year ended Dec 31, 2010 (FY10) of 13 times which is based on the historical net earnings per share of 9.6 sen and enlarged issued and paid-up share capital of 330 million shares upon listing.

AmInvestment Bank Bhd is its IPO principal adviser, managing underwriter, joint underwriter and joint placement agent. Meanwhile, CIMB Investment Bank Bhd is its joint underwriter and joint placement agent.
Oldtown said the listing exercise would enable the group to gain recognition and enhance its profile through listing status and further augment Oldtown's corporate reputation and assist the group in expanding its customer base locally and overseas.

“It will also provide funds for expansion of Oldtown's business and markets, as such increasing the overall capability of the Oldtown group,” it added.

According to its proforma consolidated statements, Oldtown registered a net profit of RM31.9mil with revenue of RM255.1mil for the financial year ended Dec 31, 2010.

The company plans to raise RM79.2mil gross proceed from its IPO, of which it will utilise RM38.1mil for capital expenditure, RM10.5mil for working capital and RM5.9mil for repayment of bank borrowings.
The company's market capitalisation upon listing amounts to RM412.5mil, based on the IPO price and the enlarged issued and paid-up share capital of 330 million shares.

---------------------------------

Business Times 22 June 2011
OldTown Bhd, which expects to raise RM79.2 million from its initial public offering (IPO), plans to invest RM52 million to build a new plant in Kawasan Perindustrial Tasek, Ipoh.
Group managing director, Lee Siew Heng, said the investment would be financed by the IPO proceeds, internal funds or bank borrowings.

He said the new plant would take over OldTown's existing food processing operations in Kawasan Perindustrian Bercham and Taman Medan Bercham, Ipoh.

"With the new plant, we target to increase production capacity by 500 per cent and centralise our operations," he said after the launch of the IPO prospectus here today.

The first phase of the plant was expected to be completed in 2012 and the second phase in 2013, he said.
Lee said the "kopitiam" chain operator and instant beverage mix manufacturer, also planned to open 300 outlets in three years from current 182 in Malaysia, Indonesia and Singapore.

"This year, we plan to open 38 outlets, of which 31 are in Malaysia, three in Singapore and four in Indonesia, with average investment of RM700,000 per outlet," he said.
Lee said about RM19.7 million from the proceeds would be used to acquire 17 companies not yet owned by OldTown.

OldTown is expected to be listed on the Main Market of Bursa Malaysia on July 13, 2011.

The IPO encompasses a public issue of 63.4 million new ordinary shares and an offer-for-sale of 33 million vendor shares at an issue price of RM1.25 each.

Of the public issue, 48.4 million shares will be allocated for private placement, 10 million for the Malaysian public, and five million for eligible directors, employees and business associates of the group.
AmInvestment Bank Bhd is the principal adviser, managing underwriter, joint underwriter and joint placement agent while CIMB Investment Bank Bhd is the joint underwriter and joint placement agent for the IPO exercise. -- BERNAMA


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Wednesday, June 22, 2011

Buy TSH

Before we decide whether to buy TSH, let is look at TSH analysis.

At TSH share price of RM3.07, TSH PE ratio is about 15x. This is at the expensive side. But their profits are expected to grow at an average of more than 20% pear year for the next year years, therefore, the PE ratio is relatively cheap.

Where is the growth coming from? Past few years they have been buying and planting their land with oil palm and now is the harvesting time.

As at 31 December 2010, a huge 73% of their planted land are consisting of immature and young mature fields. Therefore, for the coming quarters and years, as more and more trees are starting to mature, they will earn more and more profits.

TSH Resources Bhd has more than 100,000 ha of land, which they had bought it cheap years ago when the property or land prices were still cheap. But they have planted only 27,957 ha as at 31 December 2010. As they keep planting, this will makes the company busy with growing profit for the next 7 years or beyond. Now they probably have planted 39,000 ha and plan to plant additional 5,000 ha per year.

TSH gearing is quite high, at 0.76x. But some argue that it is low. Whether it is high or low, according to TSH, their gearing is at the highest now and will be getting lower and lower as the profit continue to grow.

TSH dividend yield is about 2% to 2.8%, with dividend payout ratio of 20% to 30%. This is at the fairly low range, but for a growing company, may have to accept a lower dividend as the company need cash to grow.

The above TSH analysis is by using PEGGY Method. PE (PE Ratio), G (Growth), G (Gearing), Y (Yield from dividend).

As you can see, due to strong growth, TSH is considered a buy by many analysts, such as Philip Capital, Hwang DBS, MIDF, KAF-Seagrott and Dali. KAF has a target price of RM4.60 for TSH. At TSH share price of RM3.07, although it is not at a cheap bargain, you are getting a good price of a growing company. Anything below RM2.70 is a strong buy as confirmed by many analsyts.

A catalyst for TSH is the new oil palm seed clone named Wakuba oil palm ramet. It has the potential to double the current oil yield. Currently the oil yield is 4.5 tonnes per ha, and the new Wakuba can yield up to 10 tonnes. TSH has already started planting their new oil palm with Wakuba, and with the increase in yield, it has high potential to enhance their profitability. The company also selling the ramet to make profit.

Since May 2011, TSH has aggressively doing shares buy-back, about 30% of the daily volume. Some see this as positive as it provides support for the share price, but some view it as negative as they feel that the money should be better used in other more profitable area. Some said at the current share price, it is being artificially maintained by shares buy-back.

At the the request by the shareholders, TSH has made analyst reports easily accessible to the public or investors. Some said TSH has become more investor friendly and result in more research coverage.

The disadvantage of buying into TSH is palm oil price. TSH has no control over the world palm oil price and if the price drop sharply, it will have a big impact on many plantation companies including TSH. However, according to TSH, thier focus in on the productivity. With the increase in production or output, it can sustain the drop in palm oil price. Nevertheless, many have expected the palm oil price to remain at steady level due to increase world population and the demand for edible oil.

TSH may be illiquid, but it has sufficient volume for individuals, except big fund managers. Currently very few institutional funds are holding big quantity in TSH. Some interpret it as lack of confidence, but I interpret it as opportunity. When the big funds are buying, TSH share price will move up fast and we will not see TSH near RM3.07 anymore.

Short term concern will be the world stock market. If the world stock market crash, TSH will follow, but that will provide an cheap bargain to buy.


Summary
In summary, although TSH is not at a very cheap bargain price, at RM3.07 TSH is consider a good buy with growing profit. In short term, growth is coming from the maturing of young trees. In longer term, growth is coming from the planting of new oil palm and catalyst will be the new Wakuba ramet and increase institutional buying interest.

Prices are very hard to predict, any waiting or delay in action may result in missing opportunity, although may also result in getting lower price. Up to individuals to decide.


For more information on TSH, here.
http://politemarket.blogspot.com/search/label/TSH

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Monday, June 20, 2011

Eversendai IPO Share Price Target

Before we determine whether worth to subscribe or apply Sendai IPO, let us look at Eversendai analysis from analysts report and prospectus.

For those who have no time to read in details, I have summarized them using PEGGY Method.

PE: PE Ratio
G: Growth
G: Gearing
Y: Yield (dividend)

Using Sendai Share Price of RM1.70

Eversendai 2010,   2011,   2012,   2013
EPS   RM0.156,   RM0.151,   RM0.166,   RM0.195
PE Ratio ,   10.9x ,   11.26x ,   10.2x ,   8.7x
Growth ,   51% ,    (3.2%) ,   9.9% ,   17.5%
Net Gearing 18.3%
Dividend Yield N/A
The above figures are from TA Securities


Based on the above, Eversendai PE ratio at not expensive, but also have no big discount. However, according to both ECMLibra and TA Securities, Sendai PE Ratio is lower than mid-cap industry peer average PE ratio, and because of that, Sendai stock may have some potential upside.

Growth rate is ok, and gearing is manageable. But Sendai dividend yield is not available because Sendai does not have any dividend payout ratio and is not expected to pay any dividend in 2011.

Comment by ECMLibra
They believe its valuation will be capped at CY11 P/E of 14.3 based on the valuation of WCT, another Middle East construction play. This implies that Eversendai maximum upside potential will be capped at 39%, implying Sendai Fair Value at RM2.36.

Comment by TA Securities
Eversendai is a local construction outfit specialising in structural steel supply, design and erection. The group’s main revenue driver is from the Middle East where the majority of its revenue is derived. We derive fair value of RM2.46/share based on a FY12 target PER of14x which should reflect midtier construction companies trading band in Malaysia. The discount given to our big cap target PER of 17x should also reflect its singular business model with a niche geographical business location. We recommend investors to Subscribe given positive upside potential of 44.1%.

We derive a FY12 fair value of RM2.46/share for Eversendai with a target PER of
14x. This is a discount of three multiples from our mainstream big cap construction PER of 17x. The discount is warranted for its niche construction business model and also its singular business model – structural steel. In addition, we believe that a 14x FY12 PER is reasonable in comparison with Benalec Holdings Bhd, a recent IPO and also a construction company specializing in its own niche market – land reclamation, which has a forward target PER of 14x. We recommend investors to Subscribe.

Major shareholders (Post-IPO)
Dato’ A. K. Nathan 70%.


There is one reminder. The RM1.70 IPO Retail Price is not fixed yet. The Final Retail Price will be equal to the lower of (i) the Retail Price; and  (ii) 95% of the Institutional Price, subject to rounding to the nearest sen. The Institutional Price will be determined by way of bookbuilding under the Institutional Offering.


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5 Weddings and 3 Funerals in Bursa Malaysia Stock Market

People associate weddings with happiness and funeral with sadness. When will the 5 Weddings and 3 Funerals in Bursa Malaysia Stock Market? You will know the timing if you know Elliott Waves Theory.

Elliot Waves is a technical analysis technique by Ralph Elliott. He said the stock markets follow a pattern of five waves up and three waves down (or sometimes, five up and three down in a bull market, and three up and five down in a bear market).

The stock market waves always repeat itself. Each wave has its own characteristic of features. Example Wave 5: Wave five is the final leg in the direction of the dominant trend. The news is almost universally positive and everyone is bullish. Unfortunately, this is when many average investors finally buy in, right before the top. Volume is often lower in wave five than in wave three, and many momentum indicators start to show divergences (prices reach a new high but the indicators do not reach a new peak). At the end of a major bull market, bears may very well be ridiculed (recall how forecasts for a top in the stock market during 2000 were received).

For me, Elliot Waves is complicated. There is a joke, saying if you were to put twelve Elliott Wave practitioners or expert in a room, they would fail to reach an agreement on wave count and the direction in which a stock is headed. There is no doubt that the Elliott Wave theory has posed some interpretive challenges.
This interpretation problem happened in front of me where two of my friends always argue with each other which wave are we in.

I don't know much about Elliot Waves, that is why I associate it with 5 Weddings and 3 Funerals.


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Friday, June 17, 2011

52 Ways of Making Money in Stock Market - Part 15/52 - Buy Stocks Recommended by Analysts

Buy Stock recommended by Analyst

Most of us are not expert in stock market. We don’t know how to evaluate stocks. One of the ways is to buy stocks base on analyst recommendation.
If your account is with a broker, they will have the research analysis and BUY recommendation with fair value or target price. You can buy stocks base on the recommendation.

For many years, most of my investment decisions are also based on analysts’ research, and then make my own decisions, because I don’t have time to study a stock.

RISKS, LIMITATIONS OR DIFFICULTIES:
No matter how good is the analyst, nobody really know 100% of the future. Sometimes analysts also got it wrong.

Sometimes analysts also disagree with each other. Some ask to sell, but other brokers ask to buy.
Sometimes situation and economy changes, and therefore the forecast and prediction are not accurate.
Analyst also have their own agenda. Because they prepare the research report for all their clients, retail or institutional or foreigner. That is why you always notice they recommend to buy big company.
Whether the share price will go up or down also depend very much on market sentiment. In bull market, even analyst ask to sell also the share price may continue to go up.



OPINION
If you don’t have much knowledge in stock market, it is good to follow analysts recommendation, better than buying without knowing anything. What you can do is get few more broker reports and do comparison. If many brokers also recommend the same stock with high fair value, then the accuracy or chances of making gain probably may be higher.


Article you may like.

Do not Follow analyst.
http://politemarket.blogspot.com/2011/03/do-not-follow-analysts-or-experts.html

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Wednesday, June 15, 2011

Eversendai IPO

Eversendai Corporation Berhad IPO Opening Date 15-06-11. Closing Date 21-06-11.
Issuing house MIH 516
Sendai IPO will be listed on the Bursa Main Market.
Tentative Eversendai Listing Date 01-07-11

Eversendai IPO price RM1.70.
The Final Retail Price will be equal to the lower of (i) the Retail Price; and (ii) 95% of the Institutional Price, subject to rounding to the nearest sen. The Institutional Price will be determined by way of bookbuilding under the Institutional Offering.

Initial Public Offering IPO of 232,190,000 Ordinary Shares of RM0.50 Each In Eversendai Corporation Berhad (“ECB”) (“Shares”) Comprising:

(I) Public Issue Of 160,700,000 New Shares To Institutional And Selected Investors At The Institutional Price To Be Determined By Way Of Bookbuilding (“Institutional Price”) Under The Institutional Offering; And

(Ii) Offer For Sale Of 71,490,000 Existing Shares In The Following Manner:

41,340,000 Existing Shares To Institutional And Selected Investors At The Institutional Price Under The Institutional Offering; And

30,150,000 Existing Shares To The Malaysian Public, Eligible Directors And Employees Of ECB And Its Subsidiaries At The Retail Price Of RM1.70 Per Share, Payable In Full Upon Application (“Retail Price”) Under The Retail Offering,

Subject To The Clawback And Reallocation Provisions In Conjunction With The Listing Of And Quotation For The Entire Issued And Paid-Up Share Capital Of ECB On The Main Market Of Bursa Malaysia Securities Berhad.

The Retail Price Is Payable In Full Upon Application And Subject To Refund Of The Difference, In The Event That The Final Retail Price Is Less Than The Retail Price.

The Final Retail Price Will Be Equal To The Lower Of (I) The Retail Price; And (Ii) 95% Of The Institutional Price, Subject To Rounding To The Nearest Sen.


For more information on recent IPO, here.
 
http://politemarket.blogspot.com/search/label/IPO
 

 The Star 6 June 2011.
Eversendai will use the RM270mil from its IPO for capital expenditure


KUALA LUMPUR: The flotation of Eversendai Corp Bhd on the Main Market of Bursa Malaysia on July 1 will raise RM270mil for the company.
Its founder Datuk A.K. Nathan will realise a gain of RM130mil for selling 30% of the company he pioneered 27 years ago.

Nathan said in an interview with Starbiz that the company would use the proceeds of RM270mil from its share sale as capital expenditure.

“We will be using the proceeds to build a new plant in Trichy in India and expand our plant facilities in Rawang. We would also be using the funds to build staff accommodation in the Middle East,'' he said.


Nathan says the company has an order book of RM1.5bil
He added that the choice of Trichy over other locations in India was made because it was easier to get skilled manpower for the plant there.

Eversendai has four plants that provided all the fabrication works for its projects that span from Malaysia to India and the Middle East.

The plants are located in Rawang, Dubai, Sharjah and Qatar.

The new plant in India will have a 30,000-tonne-a-year fabrication capacity.

The Rawang plant on 4.8ha is capable of churning out up to 24,000 tonnes of fabricated structured steel a year while the plants in the Middle East have the capacity of fabricating up to 96,000 tonnes of steel a year.

Eversendai started off as a structural steel erection company in 1984 in Malaysia.

It has since transformed itself into an integrated steel contractor which has engineering, structural design, fabrication and erection capabilities and carved a niche in the business both locally and abroad.

It has completed over 100 projects including Dubai's landmark hotel, Burj Al Arab, BurjKhalifa, The Dubai Mall, Dubai Airport Control Tower, Singapore Indoor Stadium, the Philippines' Mabalacat and Bamban Bridges, and Saudi Aramco in Riyadh.

Locally, it has been involved in projects as a specialist contractor for the Petronas Tower 2, Suria KLCC, Kuala Lumpur Tower, KL International Airport, KL Sentral Station, Putrajaya convention centre, new Bintulu airport, Manjung power plant, and the PKT Logistic project.

Nathan said the company had an order book worth RM1.5bil and was on the look out for more jobs in the Middle East, India and South East Asia.

“About 94% of revenue from the RM1.5bil jobs will be realised this year and the rest by 2013,” he said.

The company targets revenue to hit the RM1bil mark this year and net profit should be about 10% to 15% of that.

Last year, it recorded revenue of RM744.9mil of which 76% was derived from its operations in the Middle East, and chalked up a net profit of RM116mil.

“We would continue to eye more jobs from our regular clients and others.

“We are a niche player in this business and we do not have many competitors (in this field).

“Our challenge going forward is to maintain the work culture and standards set but the expectations of our clients are rising and to cater to that we need to keep improving and constantly train our staff so that they are in sync with company's philosophies,'' Nathan said.

Eversendai's prospectus will be launched on June 15 followed by a roadshow in the capital city and Singapore.

The IPO is expected to involve a public issue of 160.7 million new ordinary shares of 50 sen each which will be allocated to selected and institutional investors and Maybank IB is the sole adviser, underwriter and book runner for the exercise.


Business Times 
Eversendai Corp, a Malaysian steel contractor and fabricator, aims to raise proceeds of RM273.2 million from listing on the Kuala Lumpur stock exchange, according to advertisement published by the company in the New Straits Times today.

The company plans to sell 232.2 million shares, of which 202 million will be set aside for institutions at an indicative price range of between RM1.66 and RM1.80, according to a term sheet sent to investors yesterday and obtained by Bloomberg.

Individual investors would be charged RM1.70 per share or 95 per cent of the institutional price, it said. -- Bloomberg


For more information on recent IPO, here.
http://politemarket.blogspot.com/search/label/IPO
 

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