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Saturday, May 27, 2017

Tong Herr more than 40% upside by RHB

Why Tongher?

I don't really like bull run. During good bull run, most stocks also up. Tom's stocks also up, Dick and Harry's stocks also up. Ah Zhiu and Ah Kow's stocks also up. The prices sometimes run ahead of fundamental and very tempting to drop these stocks.

Looking for other stocks also harder because most stocks already expensive.

I like sideway market, if we selected undervalued growth stocks, sooner or later the prices will up, and there are still many not up yet and waiting for us.

If after market up and we say we stopped a while and wait for market to come down a bit, people will accuse us of timing the market. You know, we preached "don't time the market", and if we time, we are hypocrite.

Okay, for those who must buy or must hold some stocks, let us look at Tongher.

Back to the questions, why Tongher?

Many stocks now are trading at PE ratio of 15 times or 20 times.

Tongher share price RM3.66

Spotted in my telegram RM3.50

Tongher PE ratio TTM 12 months 11.7x

PE ratio of 11.7x is not too expensive. As per RHB research, the PE ratio will drop to 9.1x. High growth for 2017 as we already saw it in 1st quarter result that exceeded RHB forecast.

Dividend yield 8.2% for 2017. But analyst said 5.4% should be the norm, explain later.

Target price of RM4.86 is 32.7% upside from current stock price and if add in the dividend yield of 8.2%, the total upside potential is 40.9%.

High dividend yield. Paying RM0.30 this year giving a yield 8.2% but RHB analyst said RM0.20 should likely be more sustainable, yield of 5.4%. Whichever the amount, is still consider high, and RHB said in the report they also not very sure.

New initiate coverage by RHB just few days ago.

The result that just announced on Thursday exceeded RHB forecast. Although the result exceeded expectation, the price didn't go up, probably waiting for us to load up.

Below are extracted from RHB research....
Strong balance sheet with growing cash pile. Tong Herr’s net cash rose to MYR86.7m in 1Q17 from MYR44.8m in 4Q16.

(Tong Herr) has three main subsidiaries in Malaysia and Thailand. They are involved in the manufacturing and selling of stainless steel fasteners such as bolt, screws, nuts, stud bolts and threaded rods, as well as aluminium.

Acquisition of an approximately 49.99% equity interest in THFT is likely to contribute positively. Post-acquisition, the group owns approximately 100% equity interest of Tong Heer Fasteners (Thailand) Co Ltd (THFT). This would allow it to facilitate future plans on business expansion, enhancing cost efficiencies and human resource development. 
Note..... (More % also means more share of profit or get all the profit. Sorry I'm very lazy to check when this was completed, how much is the impact, whether it has been reflected in the past quarterly result(s), just follow analyst's recommendation)

Tong Herr completed the disposal of its 35.33% equity interest in Fuco International Ltd (Fuco) thereby relinquishing a loss-making business entity and realising its investment.
Note: (again, I didn't check when, $ impact, already reflected or not, etc). I always just cincin caicai analyse only.

Conclusion: Analyst said good.

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Seven investment tips from Neoh

Tuesday, May 16, 2017

Malton-LA may have to sell or convert NOW !!!

The article that I shared on Saturday 13th May 2017 on Malton-LA is no longer valid because of the announcement made by Malton on Monday 15th May 2017.

Early redemption...... last done price RM1.77, will be redeemed at RM1.00? I didn't read the full details yet. Please read the annoucement and check the terms.

Check the suspension date also.

Faster check with your remisier/dealers want you need to do.

Or remisiers/dealers faster tell your client want to do. 

Persuant to the terms and conditions stipulated in the Trust Deed dated 27 May 2011 and Supplementary Trust Deed dated 20 January 2014 constituting all the 2011/2018 RCSLS, Malton Berhad shall undertake the early full redemption of all outstanding 2011/2018 RCSLS in issue as at book closure date on 31 May 2017.

Attached is the advertisement of the Notice to Holders of the 2011/2018 RCSLS dated 16 May 2017.

Thursday, May 4, 2017

Hold MFCB or Warrant better?

Not telling whether can buy MFCB or not becoz I published 3 articles on warrant 6 months ago and now the price has gone up about 250%.
A bit too late to ask. This table is for your reference only, comparing holding mother or warrant is better, at this price.
This is what may happen at maturity, anytime the prices may go crazily from now, eg mother drop but warrant up, warrant drop a bit but mother up.
I hope I didn’t make any mistake in the figures.

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Wednesday, May 3, 2017


Spritzer share price RM2.39
Spotted in my telegram RM2.31

Spritzer Dividend yield 1.4%

See what the company said.

Despite a soft consumer market, Spritzer Bhd anticipates a double-digit growth in sales this year. The Start Monday, 24 April 2017

Exported to UK and target Europe.
Spritzer Bhd has started exports of its mineral water to the United Kingdom and hopes the country will eventually be a springboard for it to penetrate into Europe. The Star Saturday, 11 February 2017
## The quantity to UK is very small, but hope it can really be a springboard to Europe.

Promote as Health
"We will market the product under a new brand name called Acilis and position the product as an upper mid to premium product so that it will be feasible to sell there.
He says the UK Trading Standard has also allowed this product to be labelled in the country as possessing anti-aging properties that encourage softer skin, stronger nails, shiny hair and supple joints due to silicon enhanced promotion of natural collagen in the body.
"We think this will be our competitive edge as we won't be competing with the cheaper bottled water brands there.
"As proven in research by Keele University, it also helps in the removal of aluminium in the body - which is a known neurotoxin as a result of life-long exposure to the metal in food, tap water, cosmetics, medications and environmental air pollution from car exhaust and cigarette smoke," Chuah says.
The Star Saturday, 11 February 2017

Room for Export to grow?
Exports presently constitute to about 10% of Spritzer's annual revenue.

Given the number of incumbents already in the market, the group's task in China will not be easy. That said, with China's history of food scandals coupled with rising affluence in the nation, people might be more willing to pay extra for 'premium' imported products - the segment targeted by the firm - that are deemed as 'safer'. Tan Jiahui May 6, 2016 Stock Market, Upside Potential

China- 2 years from April 2016.
Spritzer started exporting mineral water to China at the end of April 2016. Malaysia's largest bottled water producer expects the venture to become profitable in two years. In the meantime, the expenses incurred to carry out the venture may affect its financial performance. The Edge Financial Daily, on June 26, 2016.
"Water is bulky, we know that expanding to China is even more costly. However, we will not be competing with the low-price segment. We will sell it at medium to premium price, so it can cover our cost," he said.
Sow said it launched 'Spritzer Tinge' in China at a price of between five to eight yuan per 500ml bottle. It will also sell Spritzer Fibre and Spritzer mineral water there.
## Probably we can start seeing the result by next year.

I don't think this stock will jump up sky high. Water is heavy and cheap, so probably the export market may not be so easy except for premium bottle which has a smaller market size.

Tuesday, May 2, 2017

Ajiya- can we invest in something that we don't understand?

Ajiya share price RM0.91.

Spotted in my telegram n/a.
I first spotted about RM0.84 two weeks ago before I created Telegram. The article is this.... read this two weeks ago.....
Minister in the Prime Minister’s Department Datuk Seri Dr Wee Ka Siong, who witnessed the ceremony, reiterated that the Construction Industry Development Board (CIDB) has stipulated that government projects must have 70% IBS content, and hopes to enforce a 50% IBS score for the private sector by 2018 in the Klang Valley. The requirement will be extended to the whole of Peninsular Malaysia by 2020.

For the past two weeks I wanted to post on Ajiya but was searching the news on Ajiya and CIDB but couln't find because now I know it appeared in Matrix news and not Ajiya.

Anyway, the problem of slowness will be solved because I have created a telegram. 

Ajiya PE ratio TTM 12.4x.

Ajiya dividend yield 2.2%.

Why Ajiya?

They have this AGIBS.

December last year the company said......
.....though the system, dubbed the Ajiya Green Integrated Building System (AGIBS), is new — it was launched just last year — Chan believes it is a very competitive system that should help the group improve its earnings performance in FY17 ending Nov 30, 2017.

With the AGIBS, Chan said Ajiya is among 15 companies shortlisted by the Public Works Department  (JKR) to supply the AGIBS to contractors to build about 100 schools in Peninsular Malaysia, though he did not reveal the value of the job.

“With the contribution of the AGIBS, we expect our earnings in FY17 to at least match the one in FY15, which is about RM22 million, if not better. But with a challenging environment, we dare not be too optimistic,” he said.

On average, the per-unit price of the AGIBS is about RM20,000 to RM25,000, which will provide Ajiya a reasonable double-digit profit margin, according to Chan.

At present, the AGIBS does not contribute much to its bottom line, but Chan expects it to make up at least one-third of the group’s earnings in FY17, while its metal roofing and safety glass businesses are expected to make up the remaining two-thirds.

Ajiya had attracted the attention of some notable institutions.

Our components can be delivered to the site by light trucks, and then assembled like Lego,”

From The Star. 
Integrated Building System (Agibs). With Agibs, the conventional 24-month construction period is significantly reduced to only eight months.
If profit of RM22 million as guided above, PE ratio will still be the same about 12.6x.

I saw the word AGIBS and the Matrix news IBS, I think Ajiya will have great potential if both IBS is the same thing that are talking about.

# Entering East Malaysia. 
The Edge news Dec 2016.....
Ajiya on Oct 24 inked a memorandum of understanding with galvanised and coated steel product maker YKGI Holdings Bhd for a long-term business partnership in Sabah and Sarawak. “Over the years, we have not explored East Malaysia much due to manpower constraints. Now, with the partnership with YKGI, we hope to do more in this part of the country,” said Chan.

Entering Asean...
Outside Malaysia, Chan said, Ajiya had taken the AGIBS into Thailand, where the group sees good demand for the system, and intends to introduce it in Indonesia next.

Said on Annual Report....
We also expect our Ajiya Green Integrated Building System (“AGIBS”) to play a vital role in our growth trajectory and will continue to expand its market in 
Malaysia, Thailand and other Southeast Asian countries. 

With affordable housing becoming an important agenda in the government’s Budget 2017, we believe AGIBS will benefit significantly, as it is a technology that promises an acceleration to the completion of products and attain higher productivity from the shorter construction period as well as reduced labour and wastages.

# If the Ajiya share price drop to very cheap level, probably Dato' Chan may buy it as what he did and said last year.

His direct stake has increased from 18% to 19.8%, and indirect remain the same 10%.

Why NOT Ajiya?

Accounting error. Previously some items in P&L was wrongly reported, but has been rectified recently.

Price has gone up 50% from RM0.60 in Dec 2016 to RM0.91 now. But if we analyse further, the price actually dropped from RM1.00 in Aug 2016, probably due to poor result and as Dato' said it was institutional selling.

Property sector may still struggling.

Latest result announced last Friday the revenue still flat. Don't be misled by the title "Ajiya’s 1Q earnings triple on higher other income", read carefully other income (gain on sale of property. 

Other business units may not perform well and off set the growth of AGIBS

If government want to impose at least 50% and later 70% of IBS content, then Ajiya may have potential if both IBS are the same IBS they are talking about.

Actually don't really understand what is this all about. But we don't have to know 100% before we invest.

How many percent of profit come from CIMB banking? How many % from investment? Overseas? Interest income more or fee? How many countries do they have operations or subsidiary? I see people buying CIMB without knowing all these.

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About Me

Dollar Cost Averaging and PEGGY Method. Sharing info on cheap (low PE) company with high growth, low Gearing or Net Cash and High Dividend Yield.



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