Remember the LORD for it is he who gives you the ability to produce wealth and so confirms his covenant... Deut. 8:18

Wednesday, July 27, 2011

TM sells stake in Axiata for RM468m

Telekom Malaysia Bhd (TM) has placed out 92.36 million shares in Axiata Group Bhd at RM5.07 per unit. The placement has raised gross proceeds of RM468.3 million.

TM said its unit TM ESOS Management Sdn Bhd yesterday completed the bookbuilding exercise of Axiata shares. The transaction price of RM5.07 was a 1.2% discount over yesterday’s closing of RM5.13.

TM said the shares were placed out to third-party foreign institutional investors. Following the placement, it is left with 807 shares which the telco will dispose of on the open market. Goldman Sachs was the sole book runner, according to Reuters

Tuesday, July 19, 2011

Affordable Housing

Thought of the day:
How will the recent initiatives (PRIMA) by the Federal Gov't to provide more affordable medium cost homes and the land provision by Penang State Gov't to build affordable dwelling in the mainland impact the housing industry and property developer in Selangor and Penang...?
Positive or negative for property sector..?
Beneficiary: Building materials sector, construction sector.

Monday, July 18, 2011

Stocks that are sliding.

Just random selection of stocks that have slumped from recent high:

In the 15 % range: IOI RM6.00 to RM5.20, SPSetia 4.40 to 3.80, MahSing 2.80 to 2.35, Gamuda 4.20 to 3.60, AnnJoo 3.30 to 2.80
In the 20 % range: HSP RM3.60 to RM2.70, UEMLand 3.20 to 2.60, Lion 2.20 to 1.70, MaSteel 1.50 to 1.20, Adventa 2.60 to 1.95, KPS 1.40 to 1.08, Tebrau 90 sen to 70 sen. .
In the 30 % range: Kinstel RM1.07 to 68sen, KHSB 46 sen to 29 sen.
In the 40 % range: Muhibbah RM 1.90 to RM 1.16 (74 sen loss..!)
In the 50 % range: IRCB 33 sen to 17 sen

Mah Sing (nta 116, Q/Q 3.6/ 3.6/ 3.8/ 5 sen) Fv w/ PER 10 => RM 1.60
SP Setia (nta 178, Q/Q 8.6/ 7.4/ 6.1/ 5.5 sen) Fv w/ PER 10 => RM 2.70

Sunday, July 17, 2011

Double your investment

At a breakfast table, the husband was bemoaning his poor record in stock market. In turn the wife was telling him about the latest diet- one of many she tried and failed too.

Looking up from the stock market newspaper, he said " you know something, honey: you're the only investment I've made that has doubled." (Beverly Dilliplane, compiled by Ng Ho Peng in his book "Laugh till you drop").

Thursday, July 14, 2011

Hap Seng.

Hap Seng closed at RM 5.31 on Thurs 14th July. Adjusted price on Fri 15th = (RM 5,310 + RM1.05 x 600)/ 3600 shares = RM 1.65/ share

A friend KH asked if he should continue buying Hap Seng shares. Consider he has collected shares from 6.10 to 5.30 with average RM5.70, with earlier dividend of 20.5 sen. His base cost of 1 share is now 5.50 just 20 sen from closing price 5.31 on Thursday 14th July.
His adjusted share price = (5700 + 1.05x600)/ 3600 = RM 1.76
At current market value of RM 1.65, his loss is 6.7 %
Hap Seng's dividend this Aug should narrow the loss.

Here's a guide in percentage of mkt share price slump from RM1.76: At 10% (RM1.60), 15% (RM1.53), 20% (RM1.46)

Wednesday, July 13, 2011

Logitec M325

Buy this mouse; it's one investment you won't regret.
Comes with a unifying wireless receiver that's even better than its predecessor M315. The scroll wheel glide with hyper speed thru web page and you can also flip the browser pages backward and forward by tilting the wheel left/right. Very comfortable to grip. Around RM 70 with 3 years warranty, it's better than the 1 year warranty cheap mouse of RM 20 with messy cable.

Saturday, July 9, 2011

Friday, July 8, 2011

GenM. TM.

GenM surges from RM 3.50 range finishing at 3.86, making a gain of 10 % within two weeks.
TM gains 4 % from 3.85 to 4.00 in the same period of time or 8 % since mid May at RM 3.70 ex. after it paid out 29 sen cap. repay + 13 sen dv. Three months back, most analysts were marking TM target price at RM3.50 to 3.90 after pricing in capital repayment of 29 sen + dividend of 13 sen. In my opinion, the analyst were shortsighted to account for the potential upside in telco sector. RM 5 is more like TP in the med-long term with more news of Axiata, Maxis collaborating with TM. Remember Axiata was in the RM 3.50 range when I call a buy in the regional telco player.
You can read my thoughts on TM in previous posting and why it should form the core of one's portfolio. Recent reading revealed that TM will embarked on a RM 11 billion HSBB, out of which RM 3 billion will come from Gov't.. Nice, very nice...

Is TM too expensive..? Not so if based on pure dividend alone, dv yield = 26/400 = 6.5 %
Is it the right time to take a position..? Yes, though my timing has always been lousy. But you can allocate 3 triggers; buy at RM4.00, RM3.70 and RM3.40

What if the stock market reverses..? Say you buy at RM4 and price plunges to RM3.70, here's what happen if you hold the shares. For 6 months, dividend payout min. 13 sen, + share price 370 = 383, you lose 17 sen (4.3 %). Hold for 1 year, dv payout is 26 sen, + share price 370 = 386, you lose 4 sen (1 %). Every 3 year gives you min 26 sen x 3 = 78 sen so should your share price drop to RM 3.22 in 3 years holding, you don't lose your capital.

Will it ever plunge to RM3.22..? It may and I'll be loading up with twice the existing holding in TM. Recap TM did a placement to local/foreign investor last year at RM3.25 and share price never touch down that level.

I invested for two friends CSM and EC, buying TM last year at RM 3.39 and RM 3.43. Gain in one year: dividend 13 sen, capital repayment 29 sen + dv 13 sen and capital appreciation 57 sen at current share price of RM4. Total = 112/343 = 32.6, say 33 %. Fabulous return in a year for a defensive laggard.

There are others who have gain much, much more when they bought in at RM 3.00 (390 - 90sen cap repay) two and half years ago. Todate they would have gain dv 13 sen, dividend 13 sen x 2, cap repay 29 sen + dv 13 sen and capital appreciation of 100 sen at current share price of RM4. Total gain = 181/30 = 60 %. To them, I take my hats off ..!

For beginners to stock mart, start loading up on TM in your stock portfolio up to max of 50% of your intended investment. Wait for share price to surge to 10-15% capital gain and a payout of first dividend of 13 sen. This will act as a hedge to protect your loss in other stock picks.
Happy investing ya...

Tuesday, July 5, 2011

Hap Seng Rights Issue @ RM1.05

Hap Seng said on 5th July that it has fixed the issue price of the rights shares at RM1.05 with the exercise price of the new free detachable warrants at RM1.65

HSC said the issue price for the rights share at RM1.05 was a discount of about 35.98% to the theoretical ex-all price of its shares of RM1.64 calculated based on the five-day volume weighted average price, up to and including July 4, of RM5.26.

The rights Issue will entail the issuance of 364.39 million rights shares and 364.39 million warrants.

Hap Seng Cons. ( nta 473, Q/Qeps 23/ 8/ 18/ 14 ) Trading at RM5.30 (pe 530/620= 8.5)

Monday, July 4, 2011

GBP plunges

GBP plunges to 1.1044 against the EURO and 4.8289 against the ringgit MYR. You can take a long position on GBP/Eur or do a Dual Currency GBP/Myr

Sunday, July 3, 2011

How to trade safely in this market

Many blue chips counter are trading in a narrow band so it seems like we'll have to trade between these and be contented with a few percentage of gain within a week or two.
GenM and Maybank seems to be trading in the ranges of RM 3.5 to 3.7 and 8.7 to 9.0 respectively for the moment and if well traded, could yield a potential of 3 %. Not much but 3 % within a fortnight is much better than the same in a yearly FD. I think there's limited downside for these two counters. TM is another safe bet ranging from RM 3.85

There's many other counters you can trade for short term gain. I'm pretty sure you have your favourites to scalp for a profit. Just ensure you pick counters you're familiar with its price action, having good fundamentals (decent earnings) and newsflow.
I think Latexx and Supermax deserve a relook with commodities prices trending down. The only snag is the income that's priced in USD ( 1: 3 MYR ). Happy trading ..!