Capitaland. China Mobile

Capitaland (C31 SI) at $3.76 ( a cheaper alternative than actual real estate)

China Mobile (0941 HK) at HKD 77.65 ( alternative to Axiata)

Axiata Q2 profit jumps 44pc

Axiata Group Bhd (6888), a mobile telecoms group, said second quarter net profit jumped 44 per cent from a year ago, driven by foreign exchange gains and a better showing by its units, especially Celcom.

The net profit of RM526.84 million is also its best quarterly performance since its listing a year ago.Axiata, which has more than 100 million customers spread over seven countries, also thinks it can almost meet its main financial targets for this year.It aims to grow revenue by 6-11 per cent and operating profit or Ebitda by 4-6 per cent, among others.Ebitda, or earnings before interest, tax, depreciation and amortisation, rose 2 per cent to RM1.24 billion from a year ago. Its revenue rose by 7.8 per cent to RM3.16 billion during the period, against RM2.93 billion last year

DiGi sees 3G as growth driver in 2 years

DIGI.Com sees 3G services as a key revenue growth driver in two years as it moves to reduce its dependence on low yielding voice and text message services, a top executive said on Thursday.
Malaysia’s third-ranked mobile operator plans to spend up to RM400 million (US$113 million) a year to build up its 3G capacity over the next few years as it plays catch-up with bigger rivals who have been in the 3G market for more than two years.“Our key positionings are around 3G and Internet services,” DiGi CEO Johan Dennelind told Reuters in an interview.

Dennelind said 3G broadband will be “a significant part of the revenue growth” to DiGi in 2011, and he expects traditional voice and data services to drive growth for the time being.
The big capital outlays required for 3G broadband services would not affect DiGi’s dividend policy, Dennelind said.“We are a dividend story. Our dividend policy is to pay out at least 50 percent of net earnings. I don’t see any reason why we should change that,” he said. - Reuters

Is it Time to Get In or Get Out..?

Market is rising but trading volume is low and has been declining.

Low volume suggests there are simply not a lot of buyers and sellers. Potential buyers are waiting for lower prices to get in. Sellers are waiting for higher prices to sell. So aggressive selling and buying are tapering off.

Taking a loss is difficult for most investors. Some investors are waiting for higher prices to "get even and get out". Look for these investors to start selling again, the closer they get to “even”. Some will lose hope and dump after they’ve suffered big losses.

Either way, we will see more selling than buying down the road.
(adapted from Bob Irish's Investor’s Daily Edge)

Perceived Support Levels: Properties Stock Counters

KLCI slid to 1169 after losing about 20 points, triggering my buying interest on some properties & construction stocks. So I did a quick check on some of the counters with the most likely strong support/ buy levels.

E & O ( RM 1.06 - 1.10 ). IJM Land ( RM 1.60 - 1.70 ). IGB, Mah Sing, YNH ( RM 1.75 - 1.80 ). Sunrise ( RM 1.85 - 1.95 ). D & P ( RM 1.10 - 1.16 ). MRCB ( RM 1.10 - 1.20 ).

Other counters that might interest me at their support levels: TA ( RM 1.00 - 1.10 ). MPHB ( RM 1.66 - 1.70 ). Gen M ( RM 2.65 - 2.75 ) . Axiata ( RM 2.93 - 2.96 ). G Packet, Leader U ( RM 0.70 - 0.73 ). RCE ( RM 0.60 - 0.65 ). Lion Div ( RM 0.50 - 0.53 ). Lion Ind ( RM 1. 25 - 1.36 )

This is not a recomendation to buy the above stocks the instance the stock prices hit their respective support levels. Rather take time to monitor the price action to ensure that these levels are the support levels where buying is strong.

And remember: Don't buy to hold long, sell whenever the market gives you gain/profit. It's impossible to rob the market.

Is Malaysia ready for retail bond market?

Malaysia is ready to open up the bond market to retailers towards providing another alternative investment option for the individual investors, said CIMB Group’s deputy chief executive officer (group treasury and investments) Lee Kok Kwan. With the persisting low interest rate environment, the discussion about opening up the bond mrket to retail investors has been heating up, although not everyone is in agreement that it should be done.

Criticisms range from the affordability of bonds to the complexities involved in bond trading, which can arguably be beyond the grasp of the average retail investor. Bonds, with their fixed return rates, are typically considered safer investing instruments than equities, although the relative ratings of the instruments must be taken into consideration.

Speaking to The Edge Financial Daily recently, Lee said the next major step forward for the local debt market would be to implement retail-side service. “The next big step is the retail bond market. Typically, you don’t want to let retailers invest in credit ratings that are too far down the credit curve to protect them because they are not in the same position as a big unit trust or big fund manager to study the credit terms. You would want to have some minimum standards and credit rating they can buy into. Having said that, once you allow them access into the bond market, the yield is much higher than bank deposits.”

Moreover, there is an argument to be made that the papers of some corporates, or private debt securities (PDS), which are highly rated — AA or higher — are safer investment instruments than some of the equities available on Bursa Malaysia presently.

Lee said the bond market did not need to incur additional costs, but could use the same existing platform of the equities market. “When you develop a retail bond market, you don’t want to create unnecessary costs. Just piggy-back on the stock exchange infrastructure and use the same platform. Instead of quoting equities, you list the bonds there. Instead of dividends, you have a coupon.

IJM Land. E & O. Mah Sing. IGB

IJM Land finally hit RM 2.00 just as expected.
Sales of the proposed 2 blocks of luxury condominium "Light Linear" launched in Penang last few weeks were overwhelming. IJM Land expects the launching of another single tower luxury condominium "Light Point" by year end to be well received.

Buy IJM Land for short to med term. I wish it was still at RM 1.61
Ditto for E & O, Mah Sing and IGB

Warren Buffett Makes Big Bet on Fixed Income

Warren Buffet is buying more corporate and foreign-government bonds and less stock these days, a possible sign that he is concerned about rising U.S. inflation.
Buffet's investment company Berkshire Hathaway held $11.1 billion in foreign government bonds in its insurance units as of June 30, compared with $9.6 billion three months earlier, the company said in a regulatory filing.

Berkshire's investments in companies such as plane-rental business NetJets and financial institution Wells Fargo have turned out to be poor bets while securities issued by Goldman Sachs and General Electric are offsetting slumping equity investments.

“Some of the normal places he’s gotten the cash to invest are just getting killed in the recession,” Gerald Martin, a finance professor at American University’s Kogod School of Business in Washington, told Bloomberg. “So he’s locking in these guaranteed returns, moving from the volatility of stocks to a steady stream of income that, in some cases, is almost at the return you normally get from the stock market.”

Markets Recede

4.15 pm..

Euro markets: UK FTSE, France CAC, Germany DAX all down by 1 %.

Asian markets: HKSE down 2.5 % and STI down by 2 %.

KNM and SAAG on the downtrend. KNM likely support at 82 sen and SAAG at 26 sen.

Sold Axiata. Buy in on dips..

Southern Steel

KUALA LUMPUR: Southern Steel Bhd reported a net loss of RM12.7mil, or loss per share of 3 sen, against a net profit of RM202.5mil, or 48.3 sen per share, for its second quarter ended June 30 on lower steel demand and lower prices.

Group revenue fell to RM488.4mil from RM977.5mil a year ago.
“The drop in revenue was in line with the contraction in steel demand and lower prices experienced since the second half of 2008,” the company said in notes accompanying its financial results yesterday.

For the six months to June 30, it recorded a net loss of RM78.1mil against a net profit of RM298.8mil in the previous corresponding period.
On prospects, the company said the worst in this economic downturn appeared to be over .
“The board is cautiously optimistic that the performance of the group will continue to improve for the rest of the financial year,” it said.

For the financial year ending Dec 31, an interim tax exempt dividend of 2.5% (2008: first interim 7.5%) has been approved and will be payable on Sept 11.

Southern Steel

KUALA LUMPUR: Southern Steel Bhd reported a net loss of RM12.7mil, or loss per share of 3 sen, against a net profit of RM202.5mil, or 48.3 sen per share, for its second quarter ended June 30 on lower steel demand and lower prices.

Group revenue fell to RM488.4mil from RM977.5mil a year ago.
“The drop in revenue was in line with the contraction in steel demand and lower prices experienced since the second half of 2008,” the company said in notes accompanying its financial results yesterday.

For the six months to June 30, it recorded a net loss of RM78.1mil against a net profit of RM298.8mil in the previous corresponding period.
On prospects, the company said the worst in this economic downturn appeared to be over .
“The board is cautiously optimistic that the performance of the group will continue to improve for the rest of the financial year,” it said.

For the financial year ending Dec 31, an interim tax exempt dividend of 2.5% (2008: first interim 7.5%) has been approved and will be payable on Sept 11.