Tuesday, 31 December 2013

Farlim - Never Too Far

The market had continue to regain their momentum from the fear of tapering, Dow Jones continued to rally on strength with DJIA gaining strength above 16000 and lingering around 16500 zone. Probably some would refer this bullish spike as a window dressing for the year 2013, or is this bull going to continue their charge in the 1st quarter of 2014?

As you are hearing from others that our local market is currently too expensive to trade with stock trading easily above a PER x12 for most of the prominent/popular stock, while some undervalued stock are not fancied after as trader/investor are afraid of the value trap and the illiquid situation of the stock.
While our market had start to regain some retail participation, I had tumbled upon Farlim for a revisiting after a few weeks.

While the news are not new for Farlim, the reason for it's share price spiking upwards towards hitting 60 cents is sparked by the interest in the sale of land in Bandar Air Itam, Penang measuring 116.89 acre for a consideration of RM 112.5m offered by 1MDB.

The price offered by 1MDB comes with a 12.5% premium appraised by independent valuer. While Penang had been the hot and sought after state for FDI under the helm of Lim Guan Eng as the Mentri Besar for Penang, Bandar Air Itam is a very strategic location in Penang. With an estimated profit of RM46m from the sale, pegged under 140m of shares issued, the disposal will easily reflect a 32 cents gain for each share of Farlim.

The latest development had seen that AmInvestment Bank Berhad, on behalf of the Board of Directors of Farlim, wishes to inform that, Farlim had on 20 December 2013 received a written request from 1MBD RE (Ayer Itam) Sdn Bhd dated 20 December 2013, for an extension of time of up to 30 January 2014 to make payment of the Balance Disposal Price to their solicitors.

In this regard, the relevant clause of the SPA shall be amended to the effect that the Purchaser has As stated in the Circular, the Proposed Disposal is expected to be completed by the second (2nd) quarter of the calendar year 2014.  
For more info, you can refer to http://www.bursamalaysia.com/market/listed-companies/company-announcements/1499565

Looking at the technical outlook for Farlim will suggest that Farlim had seen saturation at 50 cents region as volume had been drastically low. A fresh price will definitely be needed in Farlim to see more shares change hand in the coming days as shareholder might be looking for a special dividend from the land disposal.

Farlim might be trading at RM 0.80 on the special dividend announcement from the disposal of the land. As the time frame is getting shorter, Farlim might be expecting the payment from 1MDB as soon as the first 2 weeks of January 2014. A quick technical outlook might suggest that Farlim could be poised to challenge RM 0.60 in the shorter frame outlook as volume dried up at the 50 cents region as the time frame goes nearer to the payment date from 1MDB.

So had you decided for your ride?

Bone's short term TP: RM 0.60

Cheers and happy trading.



Wednesday, 25 December 2013

Wishing You A Merry Christmas

Wishing you a Merry and Prosperous Christmas and New Year.

Good health always.


Friday, 13 December 2013

Pesona - Of Bridges and Roads

While the market had been on the hype with the recent oil and gas awards and contracts from Petronas, the local market had continue to see more interest in splashing hot money to the oil and gas counter with the likes of Puncak, Barakah and SKPetrol which are the designed winner for the T&I projects. While our nation move forward in developing towards a high income nation, equipped with better infrastructure, the local construction company which is closely linked with the government are in the high notes for the incoming projects from Putrajaya.

From highway to river, highrise to low rise building, Pesona Metro Holding Berhad, through the RTO of Mithril Berhad had came to light in the KLSE market and had since been performing.

Under Pesona Metro belts are services like ranging from construction business on both buildings and infrastructures, medium to high-rise buildings, roads, bridges as well as heavy civil engineering works which includes refurbishment of river and dams.

Pesona had gained famed on their latest undertake of the revitalization of Melaka River, which had brought value the places beside the Melaka River.

With their latest prominence, Pesona is standing good in their book orders which comprises of good government pay master on the contracts which consist of:
- 1 Block of 16 storey office tower at Jalan Inai, KL.
- 126 units Sastra U-Thant Luxury Condominiums at Jalan Ampang
- ECER road works at Federal Highway, Central Spine Road.
- Design & build of a bridge across Landasan Keretapi Jalan Pelabuhan, Klang
- Proposed construction and completion of the remaining and rectification work of Government office building in Putrajaya
- Proposed Construction and completion of government building complexes in Johor Bahru.

The group had been managing well under the helm of Mr Wie Hock Beng, it had been forecast that more projects will be kicking in the coming days as the recent monsoon season had saw many infrastructural damages in the affected area. Pesona Metro is high possibly in the line to redo the river bank and roads from the damages of the flood and the upcoming prevention method in the northern region of Malaysia.

With the latest award of Best Contractor for 2013 under category exceeding RM 50m in the infrastructure sector, Pesona is on the high notes to strike more government projects in the coming days.

At the technical side of Pesona, we can see a series of consolidation on price and volume for the past 2 to 3 months. However as of lately, Pesona had regained activities where substantial amount of interest had been poured into the company. Pesona had been rumored in obtaining several government rebuilding and refurbishing contracts that could worth up to RM 300m into their book order. A quick technical outlook will be looking at Pesona breaking the psychological barrier of RM 0.50 in the coming day with a projected volume of more than 20m in the coming days.

At their current book order and the upcoming projects, Pesona might be looking to trade above 50 cents with a foreseeable longer term target of RM 0.60. A short term outlook will see an appreciation of 10% in Pesona which will put them at RM 0.55.

For more reference

Bone's short term TP: RM 0.55.

Cheers and happy trading.


Wednesday, 11 December 2013

Supermax - The Rubber Taper

While the market continue to move cautiously after a series of big bulls to mini bulls, it seems that the only main concern that is holding the world at stake now could be the tapering issues in the US currently. Back then, there are European financial meltdown, Greece stunner, Government going bust and bankrupt, or some natural disaster like Fukushima's Tsunami made disaster. Then we have warlords waging wars in the middle east with Egypt unrest, Libya war, North and South Korea drama. I believe those traders or investor that had lasted through all this had somehow became immune and for some - complacent.

Probably it would strike your mind again - Is the world economy too big to fail?

I always believe that in any worsening situation, there will be a hero. Back then during the Japanese earthquake cum tsunami, the world is literally looking to see the end when everyone is dreaming of breathing, eating, drinking and sleeping in a radioactive contaminated environment. The equity market did took a big drop, however, the timber industry in Malaysia had saw this opportunity as the rebuild of the Japanese nation will require a huge amount of timber.

With the recent talks of "tapering of QE" lingering around in our midst, let's have some in depth study on what could be the beneficial on the tapered result.

Looking back on the recent September which had been taken as "Septaper", the USD had been rising consistently and reached a peak of RM3.30 for USD1. Bigger player will tend to turn to the USD when the global economy is at stake as people will find security in the USD rather than other currency. While we can foresee a next upcoming Federal Meeting that could possibly be featuring the tapering issues, what could be the next foreseeable USD in the coming days?

Gloves sector had always been trading using USD. A stronger USD will always be an additional advantage for gloves. Let's have a quick outlook at Supermax.

Supermax had on September taken a huge surge due to the stronger USD against MYR. As the price and volume consolidate at around RM 2.75, I would believe that the talk of taper will possibly spark the USD to grow stronger, and hence benefiting the glove industry on the currency advantage. On a side note, the pandemic flu on the rise had been a major concern for country like Hong Kong, and it had been reported that Malaysia will not be spared by the Influenza A virus as Malaysia had start to quarantine people that are coming into Malaysia. The pandemic flu will definitely put a huge boost on the glove sector despite the rises of the electricity tariffs by TNB which could be possibly passed on to the consumer.

On a technical outlook, Supermax will be poised for a surge on a upcoming large volume trading day. Upon consolidation for around a month, I believe that Supermax will be ripe for a run up. A mid term outlook will put Supermax to challenging RM 3.00 in no time, while a short term outlook will see Supermax touching RM 2.85.

Are you game in or out? You deicide.

Bone's short term TP: RM 2.85

Cheers and happy trading.


Tuesday, 3 December 2013

Barakah - Raging Storms Drilling Oils

As the market had traded in a more cautious manner for the time being with the DJIA index consolidating at the range of 16000 after the bullish run up, could there be a Santa Claus coming on the December to give some winter boost this year?

Malaysia is very unique of it's own. Frankly speaking, the Malaysia KLCI had not seen any major changes back then after the post election in May 2013 this year as it had spent more than 6 months lingering at the 1800 range. While counter part had shown their interest on the upper side of the market by challenging higher mark, is Malaysia market, somehow, delayed? I would probably leave this to you to interpret.

While the current sentiment might not be so encouraging for investor to invest, or even trader to trade, however, one of the sector that might keep your interested could be the Oil and Gas industry in Malaysia. Locally and globally well known Petronas will be announcing their mega projects soon in the month of December 2013. As we can see many local players and sub contractors like Coastal, Scomies, Perdana, Perisai, Sumatec, Daya, Dayang, KNM, SKPetrol had been seeing more volume. While we are talking about more than RM 3billion worth of projects, the listing of UMWOG and Barakah in this intense period of time had definitely raised some eye browns and O&G watchdogs group.

Barakah Offshore Petroleum Bhd

UMW Oil & Gas Corporation Bhd

Both IPO, listed around the same time frame had display a stronger outlook in the market with their shares grabbed up in the open market and consolidating on lower volume at a higher price which had maintained for around a month. While both are performing well, it came to my interest on Barakah Offshore Petroleum Bhd after studying their background.

Barakah, through the RTO of Vastalux on 28th November 2011, had relisted back on the 6th of November 2013. With a total shares issued of 624 millions shares, Barakah is spearheaded by some noticeable top management team that consist of a few heavyweight from Petronas.

With Encik Nik Hamdan on the Deputy Executive Chairman position, well verse with the Oil and Gas industry for over 20 years. Founder and managing director of PBJV Group Sdn Bhd, Nik Hamdan client profile includes prominent corporates such as Petronas Carigali, Sarawak Shell Berhad, ExxonMobil, Petrofac, Newfield, Murphy Oil, Talisman Malaysia Pte, VietsoPetro and some others. With his expertise in upstream pipeline services, his management team is further strengthened with Abd Hamid presence where En Abd Hamid had spent 28 years of his total 35 years career in the O&G industry with Petronas. En Abd Hamid highlights includes appointment of Managing Director/CEO of Petronas Gas Bhd in 1999 until 2003. While other figureheads like En Azman Shah, En Rasdee and Datuk Azizan are on the line, En Sulaiman, attached with Petronas for more than 25 years in areas such as engineering, construction and installation of the structural, tendering exercise, procurement, fabrication, hook up and commissioning of offshore facilities is another huge backbone for the whole team.

In my opinion, the backdoor listing of Barakah via RTO on Vastalux, the management team that consist of core people from Petronas, and the high anticipation season on the Petronas huge projects is definitely something that one should take some time and think about it.

While there are certain solid sources on huge proxy buy back on the shares from open market on Barakah, and with this, I believe that the bagging in of projects by Barakah from Petronas can be almost certain. Barakah via PBJV had tendered for Package A shallow water with a possible head to head battle against Target Energy where it carries out a maximum of RM900k per day on operating day rates.

In a short conclusion, with Barakah background of expertise and ex-Petronas members on the line, coupled with the buying back of the shares, you decide your game.

Bone's short term TP: RM 1.60.

Cheers and happy trading.


Tuesday, 26 November 2013

Mtdacpi - Bridging on a stronger note

The bull had continued to linger strongly in the market as it prepares for a larger party in the coming December. With the DJIA index going stronger now, I believe that the market is still bullish for an upcoming run.

As many company had been reporting their 3rd quarter result on this season with Malaysia reporting a 5% growth in the GDV, we will be seeing more revenue kicking into company, especially those with government projects.

One of the company that had been on my look out is none other than Mtdacpi 5924. Let's have a chart outlook on Mtdacpi.

This company had been awarded with RM 500m worth of MRT projects. As we can see the progress of MRT projects going on smoothly with claims coming in stage by stage, Mtdacpi, with 231m shares issued is projected to see an increase of revenue in the coming quarter which will be going to be announced soon in the coming days.

Mtdacpi had been experiencing an increase of revenue pegging at 67m for the 1st quarter. The coming up second quarter which is projected to see more revenue to kick into their financial statement will be probably projected at another RM 70m to RM 80m in their revenue, which could possibly reflect an EPS of 1 cents in their 2nd quarter earning.

On a quick outlook, Mtdacpi had been seeing consolidation on it's price as I would believe that the next upcoming volume surge will definitely bring Mtdacpi towards a greater heights soon based on the impending 3rd Quarter result.

Mtdacpi should be able to go up to RM 0.55 in a short term basis, while a longer tenure outlook will be seeing Mtdacpi trading above RM 0.60.

Bone's short term TP: RM 0.55

Cheers and regards,

Wednesday, 20 November 2013

Tanco - Breaking The Dawn Light

While the market continues it's bull charge once again with KLCI positioning itself right above 1800 immediately after a quick correction, counterparts in the West had been continue to deliver as DJIA had been looking at conquering the 16000 mark with S&P 500 testing the 1800 heavily too. Market is always unpredictable, but if you are trying to predict the market, you are going to end up worst as some will stand strong on their wrong prediction as the fire burn through their pockets.

While Malaysia had been growing from strength to strength, I would expect stronger revenue being recorded on nearly most company which are at least fundamentally sound in their management. However, despite on the vast selection, Tanco had recently caught up with my eyes on their next corporate development.

Tanco had been running in the dark for the past many years and had just recently able to settle of with the liquidator claims on their borrowing from Lehman Brothers. While they are still swimming in debts without a proper source of income to finance the debt and interest, the recent EGM on 8th November 2013 had approve to Tanco do undergo a Debt Capital Restructuring Program where RM0.80 of the Par Value of RM 1.00 will be restructured out from 334,886,726 shares, amounting to a whopping RM267.909 million, which is a strong enough cash to turn the company to debt free.

Tanco had been sitting on a large land bank particularly in Port Dickson with a boastful 400 acres beach waterfront land bank. On an on going concern for the company, Tanco had received approval on the plans for the development of the 400 acres of land into one of the largest beach waterfront leisure and resort center in the Peninsula Malaysia with a featured water themed park. The project, named Splash Park, carries a RM 5b GDV tagline, will be split into a few phases with the first phase featuring approximately 200 units of hotel suites with high GRR returns to investor for 9 years.

While the challenges are huge, Tanco had been collaborating closely with the Best and Top Real Estate Agency in Malaysia - GS Realty Sdn Bhd in this project. GS Realty Sdn Bhd boasting more than 10,000 negotiators in Klang Valley alone and a strong and vast network, with their persistence, creativity and skills in selling, GS Realty had displayed their success in 2 major highlighting projects in Malaysia.

- i-City,Shah Alam
Pioneer team to spear head the i-SOVO and i-Residence projects inside i-City from July 2012. IBhd had been trading at 80 cents range at the time being. i-SOVO priced at RM500 per square feet sold out 90% in 2 weeks.While condominium had not been popular in Shah Alam, GS Realty had taken the challenge to wrap up the i-Residence condominium as well. Currently, i-SOHO had been going strong as well. IBhd traded above RM 3.00 on May 2013.

- Hatten City, Melaka.
Another pioneering team that had remained with the developer throughout the rough waters for 5 years. Hatten Square had finally been packaged into a prominent place in Melaka now with retail lots selling at more than RM1000 psf.

As I believe Tanco had been in their low moment for the time being, I believe the successful roll out in Splash Park will definitely spark a new dawning light for this company in the coming days. Sitting on a RM5b GDV will be good enough to keep Tanco busy for the next upcoming 3 to 5 years in their book orders soon.

On a quick technical outlook, Tanco will definitely poised to raise higher on a high surge of volume fueled by corporate exercise and their key project in line. A quick outlook will definitely see Tanco test on RM 0.20 while probably break into the region of RM 0.25 soon. While there are rumors that Phase 1 had a quick snatch up rate of more than 100 units being booked, I believe more unit could be snatched up soon. A longer term outlook will position Tanco trading into RM 0.30 to RM 0.40 in the coming days, while should Splash Park is fully completed, Tanco could be probably trading at RM 1.00 region again.

Bone's short term TP : RM 0.22

Cheers and happy trading.


Tuesday, 19 November 2013

PTB - Return Of The King

A few days ago, I had been seeing people calling for a sell, major down fall of the market with all sort of predictions from big hand shorting to small hand doing nothing, thus and so on. However, just a glimpse of an eye, the DJIA had went up again breaking the mark of 16000 on a stronger note as economist had been pulling up together to make the world a better world. I would sum up that one could never really time the market.

The KLSE had been maintaining well and would probably poised for a better run in the 1800 region soon as the Q3 of Malaysia had recorded a spectacular 5% increase of GDP whereas counterpart like Hong Kong had been slipping of from the expected benchmark.

As the 3rd quarter of Malaysia GDP had displayed a stronger result with a stunning 5%, I would believe counter like PTB could be in a high possibility of benefiting from this growing GDP in Malaysia.

Let's have a quick look on PTB charting. As interesting as it can be, PTB had been actually laying off in a low mark for the past 2 years as their financial had been running on a rough mountain, but things had started to take a turn when they had displayed a stronger 1st quarter and 2nd quarter earning on FYE 2013 which had taken some attention from the market as a unidentified gem.

PTB had been primarily manufacturing power cable with 2 wholly owned subsidiary manufacturing conductor shield and insulator for power cable up to 35KV, and also the core material for the power cable. The massive growing sector in the properties and construction industry had definitely spiral up many other sectors, and for this case, it should not be spared as well. PTB had rumored in securing book order that could amount to RM150m fueled by demand from construction and infrastructural projects from government which could be having them occupied for FYE 2013 and FYE 2014.

While Malaysia had been aiming to become a high income nation, I believe that many more major government contracts will continue give the economy a boost especially from the infrastructure, construction and the oil and gas industry.

The technical outlook had signaled out interest in PTB as a 2 months consolidation effort had come to a saturation. PTB had been sitting on a steady EPS of 0.52 cents per quarter. At 1.04 cents EPS for 1st half of 2013, PTB had been trading at x12 PER now. Should PTB be able to perform on the same or better EPS for Q3, a forward earning EPS of 2.08 cents for FYE 2013 will translate to RM 0.20 for PTB, trading on a x 10 PER. However, on a growing note, PTB could possibly hit up to 3 cents EPS for FYE 2013 when the order book continue stronger, with that, PTB could be marking it's way towards 25 cents in the longer run.

On a short term outlook, I believe PTB is poised to challenge a higher mark at RM 0.17 on the anticipating for Q3 result. A longer term solid outlook will position PTB above 20 cents in the coming days.

Bone's short term TP : RM 0.17

Cheers and happy trading.


Friday, 15 November 2013

Ecofirs - Carbon to Diamond

I believe quite a number of people had been caught pants down on the sudden sell down which had been spurred by the selling of the foreign stakes in the local market especially on the index linked counter. The sell down is highly linked on the strengthening of the US Dollars, or you would want to see it as the weakening of RM against the USD? Well, it is up to the eyes of the beholder to see a cup which is half full, or half empty. However, during this period of ant-bite meltdown, does this trigger you to sell, or buy?

As Yellen had initiate a statement which could possibly indicate the QE will continue through the winter, what is your take again on this? Ride or see?

While the broad market had been always a big guessing game, I would still believe that our local market is still good in a manner that it is partially on it's own world somehow as I would like to introduce to you yet another interesting counter to be looked at - Ecofirst Consolidated Berhad, known as Ecofirs (3557).

A quick glance at the chart will definitely inform you on the substantial interest that had been poured into the company as the volume had been traded on a fairly large manner compared to it's normal season. I would believe the game had still a long way to go as this is just another small consolidation on the price and the volume. As the broad market had resume it's confidence, I believe it is time for investor to pounce on some potential target once again.

Ecofirst had been a rather low profile diversified company with Properties, Construction, Bio Organic and Mineral Resources under their belt of business. While the past 10 years had been a rough ride for Ecofirst, Ecofirst had persevered throughout the journey and strive the best out of them as they had undergone certain key pointer in restructuring the team and effectively eliminate the waste of resources and redundancy in their management.

The latest Q1 for FYE 2014 had earmarked a 3.24 cents EPS which had been rather spectacular as this result was the best performing quarter in the 10 years time frame. Ecofirst, better known as the developer behind South City Plaza, together with the recent development of The Academia which had been fully sold out like hot peppers had spin the place from good to better. South City Plaza had been growing on their tenant and had since doing great as the place had grow in a large scale due to the attraction of The Academia which had attracted local investor to realize the potential of the place. On the side note, 1 Segamat which had been revived on 2010 had saw it's opening receiving thunderous support as tenant went on a mild rampage in securing a spot in the mall.

Ever since the restructuring in their management team on a better and prudent management, Ecofirst had seen a better transformation under the helm Dato Tiong Kwing Hee, Ecofirst had continue to gain major shareholder confidence and support as the Teoh family had continue to register their shareholder to a higher percentage from the public.

I believe that Ecofirst will be another stunner in the market in time to come as they continue to perform better in the coming quarters.

A quick calculation will put Ecofirs into trading at PER of x6.1 just sitting solely on Q1 2014 EPS of 3.24 cents. Should Ecofirs continue to perform on a skeptical rate of 2 cents for the next 3 quarters, we might be looking for a total EPS of 10 cents for FYE 2014, translating to a potential of RM 0.60 should Ecofirs trade on a x6 PER.

A quick outlook will suggest Ecofirs to be hitting RM 0.25 on a short term basis, while a longer term outlook which is back by stronger quarterly result will definitely be lifting Ecofirs out of the 20 cents zone in no time, probably lingering in 40 cents to 60 cents region.

Game on? You decide.

Bone's short term TP: RM 0.25

Cheers and have a good day.


Tuesday, 12 November 2013

Dolomite - Striking Sky High

While some people are talking about big sell down on the US market and a big bear is going to attack the market soon, it had been rather immune to me to be bothered about the US movement for the moment as I believe that the Malaysian market is somehow or rather playing amongst themselves and is not consider the foreign market too often unless there is something really major and big that is happening. As for me, I will continue to look out for better options that is lying there for me to find out.

While the DJIA had been going up again and had been nearing the 16000 mark, our KLCI index had been still laying in the controlled zone between 1750 and 1800 where some of the analyst had been forecasting that Malaysia index could be hitting up a high of 2000 point at the end of the year or beginning of the year 2014. Averaging 50 points a month for 2 consecutive month, anyone is going to buy this analyst?

I would rather find Dolomite Corporation Berhad, known as DOLMITE 5835 in the KLSE exchange board, an interesting counter to be ponder upon.

Dolomite had been laying in the wild for more than 3 years as they had been rather inactive throughout the period without any substantial development in the market which would put them into the lime light. However, it is not remaining as it was now as the company had been taking a change shift now.

Well known to be lingering at the region of 30 cents without any interesting volume, Dolomite had came to the picture when they had started to do better in their financial for a start.

A very quick glance will be showing that Dolomite had been doing better for the current 2 quarters with a cumulative EPS of 4.41 cents for the 1st half of FYE 2013. While the Q3 report for FYE 2013 will be just around the corner, I would believe that Dolomite Q3 for FYE 2013 will not be disappointing with the following reason:

- A stronger book order on their stone quarry as many development in the Klang Valley had been in their construction stage. Demand will continue to rise further as more projects start to kick off.
- Limited output in supplies to cater on rising demands will automatically spur a better margin in the products.
- Their local projects, Dolomite Templer, sold out, will be looking to see a better turn for Dolomite.

On a very skeptical measure , should Dolomite continues to perform on a average of 2 cents EPS per quarter, we are probably looking at 8 cents EPS for FYE 2013, trading on a x8 P/E ratio will interpret to a RM 0.64 in the medium to long run. However, if we take into consideration for a growing EPS due to the stronger demand in their products, there is chances of a growing EPS at 3.5 cents for Q3 and 4.5 cents for Q4, which might interpret Dolomite to somewhere at RM 0.80 in the coming days.

As the technical outlook for Dolomite had been promising with stronger volume backed up on the bullish candle with a last minute huge buy up effort, I am expecting Dolomite to be hitting a short term price of RM 0.50 soon as larger amount of volume flows into the counter.

Bone's short term TP : RM 0.50

Cheers and Happy trading.


Friday, 8 November 2013

Fitters - On the Fittest Charge

While property segment had been downgraded in the recent Budget 2014 announcement that had put a major roadblock in the speculation of the properties by implementing a 30% RPGT for the first 3 years of the flipping and a minimum of RM 1million for foreigner to purchase a property in Malaysia, could there be no light in this industry anymore for the coming 2 to 3 years run? Most of the Malaysian had welcomed the government to intervene into such an extend, there are still pros and cons related to this matter. Malaysian property - too expensive? Or, not too expensive, but had reach a level where most Malaysian could not afford?

Despite the measure being implemented, I would still believe that they will still be roses amongst thorns and mud in the making as I would like to highlight to you - Fitters Diversified Berhad.

A very quick glance will show you that Fitters had been trading off at the range of RM 0.70 to RM 0.80 for the past 6 months after the strong rally back then at the beginning of May 2013 which had saw Fitters charging forward from 60 cents to a high mark of 85 cents.

As of recent, Fitters had been consolidating well at the level of 70 cents as it's performance for the 1H for FYE 2013 had been roaring in a seemingly loud level with a boastful EPS of 7.21 cents for 2 cumulative quarters, with Q2 of FYE 2013 performing better than Q1 of FYE 2013 as their project revenue starts to kick in stage by stage.

With a healthy book order which consist of local and overseas project, I believe that Fitters positioned is not in anyway affected in a huge manner as they bolster with diversified sector under their wings. The local highlights in the prime area of Setapak with Zeta Park on the lead which had been fully sold out had been churning in revenue stage by stage as I foresee that their Zeta DeSkye is not going for a shy walk in the market too.

Beside being a developer, Fitters had under their belt, Z'odd Design Sdn Bhd which had been involved in Themed Park construction and design in a global manner. Other sectors includes trading of fire safety tools and equipment, M&E expertise, and renewable energy.

As the Q3 result is lurking around the corner, I believe that Fitters EPS for Q3 will continue to be consistent as they continue to derive revenue from the projects with a projected EPS of 3.5 cents for Q3 and 4 cents for Q4.

Should the project goes according to the timeline, then we might be possibly looking at a total EPS of 14 cents for FYE 2013, which will translate that Fitters might be trading at a fairly low P/E level of x5 for the moment. Taking into industry skeptical PER of x7, Fitters could be valued at RM 0.98 at the back of 14 cents EPS, while a PER of x10 will interpret into a possible mark of RM 1.40 for Fitters.

As Fitters had been a fundamentally sound company, a quick technical outlook at Fitters will suggest that Fitters is in no time in reaching back to RM 0.80 in a short term measure, while a medium to longer term outlook will suggest Fitters in trading at RM 1.00.

Bone's short term TP: RM 0.80

Cheers and happy trading.


Wednesday, 6 November 2013

MBL - Crouching Palm Hidden Oil

The market continues on it's auto pilot mode as the negative news had been thrown into the caves for the time being before they emerge to haunt us again. Are you still sitting on a pile of cash like our local fund management group at I-Capital where they continue to wait for the rabbit to run off course and hit the tree?

As we leap into the Q4 of 2013, it had been seasonal for most of the South East Asia countries to see heavy raining seasons as the cloud unleashed the flood gates to the earth. It is unforgettable for me to see how the flood water had in turn lifted JCY from a pile of ashes to a gold mine in the hard disk industry during 2011. This time around, could it be a hit for CPO as the rainy season had been disrupting the harvesting for Palm Oil.

The CPO prices had been a hit lately with the rainy seasons as we had witnessed CPO prices hitting above RM 2600 a ton, while analyst had been forecasting that the CPO price can hit as high as RM 3000 a ton in December with the rising global demand.

Muar Ban Lee Group, or known as MBL, is a leader in the Malaysia Palm Oil Industry which specialized in palm kernel oil expeller and oil expeller machinenery. With the rising surge in CPO, MBL is not ruling out himself for yet another party season with the bullish CPO.

Let's have a quick look at MBL share price.
MBL had saw some recent spikes which had been consolidating off at RM 1.10 to RM 1.15. We would be seeing a surge in volume for the next few days as a forecast ranging around 1m to 2m volume might be coming in which will bring the price of the share further up. With only 92m share issued, I believe MBL will be poised to challenge higher as their Q3 for FYE 2013 is positioned to give a major come back from the previous 2 quarter which is slightly lower from expectation performance.

Should the CPO continue to inch higher, I believe MBL will continue to benefit from this hike and will be positioning to tackle RM 1.30 in a short term outlook while a medium-longer term outlook will suggest MBL might not be shy of trying RM 1.50.

Bone's short term TP: RM 1.25

Cheers and happy trading.


Monday, 4 November 2013

MPI - Silicon Diamond

While the DJIA had been rebounding back to it's bullish moment yet again as they end their week in a positive note at +69.80 to inch the index to 15615.55, both S&P500 and Nasdaq had been lingering in the greenish zone too as market had prepared for yet another rally again. It seems to me that the bear had been attacking in a fast and furious manner while the bull had to charge with their horns and push it with their blood and sweat to push things higher.

As Apple and Samsung had been no alien to you and me, we had saw how these two tech giants had been conquering the smart phone segment from turning this niche market into a mass market as their products bolster on the functions, convenience, ease of use and most importantly - always stay connected. Gone are the days of Nokia, when I remember Nokia 3210 can literally kill a dog when being thrown at.

While the maddening sales figure had gone from mad to crazy on the sales of smart phone which had been selling like hot cakes when they are being bundled up by operators with Data plans, what about the "organs" that make up the smart phone - semi conductors?

Let me bring forth to you - MPI, a leading manufacturer for the semi conductor industry.

MPI had been trading at a market value of RM 5 to RM 6 back then at 2009 and 2010, while the sliding margin in the industry had been shredding off market value. While MPI had been spending more than 1 year in consolidating below RM 3.00 mark, it had came to light when the semi conductor industry had seen demand surging with the US leading at +23.3% increase in demand. A quick look out will be suggest that MPI will be challenging back the mark at RM 3.00 as they are taking this golden opportunity to rebound from the low.

The recent revenue which had been more than RM 1.2b had saw the group recover as we continue to see a surging demand in the IT gadgets, most importantly contributed by the higher margin in the smart phone and tablet segment as MPI major market comes from the US and Europe country.

Sitting on a NTA of RM 3.78 and with strong cash flow, MPI had been value by Public Bank at RM2.90 to RM 3.00 as they bolster on strong asset in the balance sheet. I believe on the upcoming year of 2014, MPI will continue to see a positive note in this industry as the demand for IT gadgets which feature ultra small and mini semi conductors rolls. I believe that the complexity of the ultra small and mini semi conductor will definitely make their product a harder target for imitation. MPI will be easily challenging the RM 3.00 mark, and a longer tenure outlook will suggest that MPI will take this long term rebound to reposition themselves at RM 3.50 in the coming days.

Bone's short term TP : RM 3.00

Cheers and regards,

Friday, 1 November 2013

HoHup - Gems of the Gems?

The overall market had turn into slight correction after a seemingly tired and wear off bull had been charging from the lows of 1660 during the end of August 2013. As of today, KLCI had been sitting at 1806 points with 10 points being shred off today as correction take place.

While the market had been shredding points, the stories and happening behind HoHup could be rather an interesting one as the recent price movement activities between HoHup, FRB and Insas had in turn become more and more active being traded in the market for the past 3 months as the same boss behind this 3 company, Datuk Thong Kok Khee, had been trying to unlock the golds and diamond out before the financial cycle is turning towards a more bearish moment.

A very clear and straight forward look on both Insas and FRB will mark out that October 2013 had saw volume of both the 2 counters rising with the Datuk Thong direct purchases and company buy back occurred in Insas while Datuk Thong had also buy back through open market on FRB shares.

HoHup had been encountering the same buy back by Datuk Thong through open market which had spiral the stock way upwards to RM 1.80 in no time.

While there are news that HoHup flight is because of it's uplifting on their current PN17 status, I believe HoHup spikes had not been just so easy and will possibly be a take over and privatization target by FRB which had been holding more than 20% of stakes in HoHup. Many would be wondering why HoHup had suddenly turn from a charcoal to be a diamond.

Probably some of the facts will see why HoHup came from charcoal to diamond.
- HoHup owned 60 acre of land in Bukit Jalil. 50 acre developed by Malton which will possibly feature Pavillion 2, and might be bringing a GDV of RM 2b in estimation.
- HoHup entitlement for 18% of the GDV or a minimum or RM 220m, of which RM80m being cash advance for HoHup to restructure on their debts.
- HoHup 10 acre which is divided into Parcel A with GDV close to RM400m and near to 90% sold off, Parcel B is estimated with GDV more than RM500m with high ends condominium in their line. A combined total of RM900m in GDV.

A simple calculation will be looking at HoHup pocketing RM220m (confirmed amount) + 30% from estimation of RM900m GDV which is RM270m will resort to a total of RM490m in profits.
Standing at 102m shares, we are looking at an EPS of RM4.8 for the whole project period when earnings start to kick in.

With this being laid out, sources that are reliant had also informed that HoHup will be a privatized target by FRB which could take place in the 1st or 2nd quarter of 2014 as Datuk Thong will be looking to unlock HoHup value under his own umbrella using FRB and Insas.

On a quick outlook, HoHup is definitely a gem which should not be overlooked because of the PN17 status. A longer term outlook will suggest that HoHup might be trading at RM 2.40 (RM140m after less RM80m for debt repayment and 30% of RM400m from parcel A = RM260m. EPS = RM 2.55 per share) as time get closer and closer.

Bone's short term TP: RM 2.10 (upgrade)

Cheers and happy trading


Thursday, 31 October 2013

Hohup - Breaking Heaven Soaring Sky

As we are reaching the end of October 2013, usually this day will always be "marked" by the local giants in a manner to create a better history in the Malaysian share market KLCI index. The 1st month of the 4th quarter of 2013 had mark some remarkable event like the Malaysian Budget 2013 which had given the Malaysian market some direct boost towards certain sector and direct damage as well on certain sectors. The 2 main talking component - GST and RPGT had speared into the market with their chain effect which we saw property counter shredding off value by a higher tag on RPGT and certain IT company receiving countless demand which had lifted the shares higher.

While there are many happening out there, it had been some happening moment for Ho Hup Construction Company, or well known as HoHup.

Let's have a quick look up at HoHup recent activities in the market.

The share price of HoHup had escalated fairly fast when they had started their restructuring process after getting the nod from shareholder and creditors. As HoHup had been consolidating off the mark at RM 1.80 for around 1 month, the golden land bank that HoHup had at Bukit Jalil which had been in tussle with Malton had came to an agreement where both parties will be collaborating into developing the 50 acre land in Bukit Jalil. Apart from that, the construction of Pavillion 2 which had been in the talk had further spiral HoHup into a better outlook as they are possibly involving in the construction of Pavillion 2 which had been one of the KL busiest area.

HoHup, with a total share issued of 102m shares and Par Value of RM 1.00 had been targeting earning of RM 1.00 EPS for FYE 2014 prior to the contribution of the Bukit Jalil project with fast running project and easy to sell. Their SOVO which had been sold out more than 75% had been one of the major contributing pipeline in the revamp of HoHup.

A quick technical outlook will definitely suggest that impending volume will be marching forward once consolidation had reaches it's level of saturation, and we are looking at HoHup to consolidate further which might be likely near to RM 2.00 on it's next flight. While on the fundamental outlook, HoHup repackaging and revamping their business through debts capital restructuring process and on going projects with future prospectus had change the outlook of HoHup into a turning point.

While we are looking at HoHup potential, Insas Berhad had been busy accumulating off open market up to a stake of 10% and I believe HoHup primary values will be unlock in a quick manner if major shareholder Formis Resources Berhad, FRB, decides to take HoHup private as a wholly owned subsidiary.

With the similar spike on 9th October 2013 in HoHup and FRB, the possibilities of HoHup getting privatized by FRB could be just around the corner as FRB might look to unlock the deeper and stronger values in HoHup on their own.

Bone short term TP: RM 1.95

Cheers and happy trading

Wednesday, 30 October 2013

Farlim - Firing Limitation

The local market had been responding quite well after the Malaysian Budget 2014 which had featured a RPGT increased which is marked at 30% of profit for the 1st three years which had raised concerned by developers who had been trying to tag the prices of the development higher and higher after each round. Foreign investor will need to qualify themselves for RM 1million property in Malaysia which had somehow put some speculation to a coma for the time being. However, I believe that there will still be speculation once the market get used to it.

While all properties sector had been downgraded by the implementation of the new regulations that are trying to curb speculations, it could be another side of the story for a low profile Farlim which could be firing the other way.

Farlim is locally known by the Penangnites as they are one of the core developer at Bandar Baru Ayer Itam. However, Farlim had not been active, not until their recent land disposal which had sparked some activities over the open market.

Let's have a quick look at Farlim share prices.

Farlim had taken a sharp increase some it's slumber of RM 0.30 region when the news came to light in the papers as Farlim dispose a piece of land at Bandar Baru Ayer Itam. The stock had came as high as 60 cents and had been consolidating at RM 0.50 for 1.5 months prior to the spike. A quick look will suggest that the consolidation at RM 0.50 had reached a level of saturation and a new fresh volume will be possibly taking place at Farlim to bring it's share price to another level for a higher note of consolidation.

Farlim had disposed 116.89 acres of Penang land at Bandar Baru Ayer Itam to 1MDB for a consideration price of RM 112.5m, or RM 110 per square feet. While the land had appreciated much, Farlim disposal at RM 112.5m had actually pegged 12.5% higher than market valuation of RM 100m which directly contributes to the group earning at RM 46.11m.

With 140.326m shares issued, the gain from the disposal will reflect at a 32 cents gain per share as it had sparked some eye brown on the group possibility on giving back in the form of special dividend which will be announcing at their next quarterly result at the end of November 2013.

Standing at a NTA of RM 0.82 per share, the group performance had been rather low, but we would believe that the group are going forward for a better change as they reposition themselves again in the coming year.

A shorter term outlook will foresee Farlim on heading back to RM 0.60 and breaking a higher as Farlim will be projected to linger higher from RM 0.50 as they try to find another point for a higher consolidation.

Bone's short term TP: RM 0.56

Cheers and have a nice day

Saturday, 26 October 2013

Malaysia Budget 2014 - Summary

Here is a general summary for the Budget 2014 for Malaysian.

Cheers and have a nice weekend.


Thursday, 24 October 2013

Scomies - Die Another Day

As market had unleashed the Western bulls recently by cracking the ceiling of debts, Malaysia had unleashed it's Malaysian's bulls as well. Waiting on the next big event in the nation of Malaysia will be the next upcoming Budget Malaysia 2014 which had been the limelight and focuses of all Malaysian in this coming Friday, 25 October 2013.

As bullish as the market can be, probably it will be the time to look on some bullish turning corporates that might be having a string of benefits in the link of the upcoming Budget Malaysia 2014 - Scomies

Let's have a quick look at the chart of Scomies or Scomi Energy Services Bhd

A quick outlook will probably suggest that the stock is just waiting upon the next pending volume will be lashed out in the coming days, or it might probably turn out to be one of the major player in the Malaysian Budget 2014 benefiting player.

Scomies quarterly result had been lying in the red for the previous year, however, we had seen some turnaround and overhauling in the management level which had seen Scomies had been repackaged for a better outlook for FYE 2014 with their quarterly bagging on the positive portion. Scomies had also been seen involving in quite some projects as strong demand for it's drilling fluids and waste management solution which came from Malaysia, Thailand, Turkmenistan and West Africa. We will be likely to see revenue flowing in from the major projects that will significantly affect Scomies next quarterly result.

While the group had been struggling on the Bursa requirement to balance out the public shareholding spread after being given an additional 6 months extension from the previous deadline of 30 September 2013, it will be a crucial 6 months for the group to :
i.) Inject 5% of total issued shares (around 117million shares) to the public
ii.) Garnering strong public supports and attention
iii.) Maintaining the share prices

In order to achieve this, the group will have to convince the public with a solid fundamental outlook on the group performance in which I believe is the major turnover and makeover for Scomies.

Scomies had been rallying up from a lowly 30 cents zone to a peak of RM 1.00 back on 5th of July 2013. However, it had since fallen apart for a period of 4 months which could be a period of consolidation on the volume and price. As fresh volume emerged, we are looking for Scomies to soar higher towards the 80 cents region, while challenging the RM 1.00 mark in the coming days. I strongly believe that Scomies will probably need to soar higher in order to make a comfortable cushion for it's distribution of 5% into the public market.

Buying your ticket for a ride this time again? You decide.

Bone's Short Term TP: RM 0.80


Monday, 21 October 2013

Tebrau - Tomorrow Never Dies

As merry and happy like most of the traders who are anticipating a positive outcome in the US crisis issues, the market will take it's time to resume it's higher note again after the recent shot down for the issue of the US debt ceiling issue coupled with the Government shut down that had spike drama for 16 days. Although this drama did delay a little bit longer than my expectation of probably 3 to 4 days, the congressman did a good show for some 16 days where the world kept watching day by day on their next progress.

Similarly, I had been watching the progress of Tebrau - day by day, after there had been vicious attack on the counter that had brought Tebrau from a lowly 60 cents to a high of RM 1.75 in the recent months which had also spark off some discussion on the land that Tebrau is owning in the prime season of the southern kingdom - Johor.

Let's have a quick look at the price of Tebrau.

A quick outlook at the share price will indicate that Tebrau had been consolidating off the mark on their volume and price. Tebrau prices had been maintaining in a good manner well above RM 1.00 after being brought up from the low, and the consolidation is targeted at RM 1.30 to RM 1.40.

Tebrau had been rather silent in the past couple of years back, not until recent when the Malaysian property had gone hot enough to see bigger company are actively acquiring land to secure a piece of cake in the hot market. As Tebrau financial had been doing better for the 1st half for FYE 2013 with, standing at a NTA of RM 0.78 which was last revalued 9 years ago, and EPS of 0.83 cents for the 1st half, I believe the tremendous increase in their share price doesn't really reflect for the financial result, but in fact, for their land banks that they are holding on which are highly sought after. 

Tebrau had been sitting in quite some big plots of land in the prime area of the hottest development in Johor - Iskandar. As Johor had been a target of both foreign and local investor, the land and property prices at that range had become hot like never before as heavy speculation targeted in that area. While the story get hotter, Tebrau added another boom to the story when they had a stretch of 12km long waterfront development which had been at the eyes of Datuk Lim Kang Hoo, who had tried to take over the company at 76 cents back then at 2012 but failed. While the story had yet to see an ending, Tebrau had continue it's course to rise towards RM 1.75 which had sparked eyebrown that Tebrau could be lingering at RM 1.80 for a take over exercise which will deemed better for the minority shareholders.

I would believe strongly that Tebrau will see another surge of greater volume in the coming days accompanied with a solid white candle that will bring Tebrau into the lime light once again. Factor in a 10%, we might probably be looking at RM 1.50 in the next upcoming flight while a mid-longer term outlook will suggest that Tebrau will march forward to RM 1.80 soon.

Decide to march along the wave or stay ground to watch - You decide.

Bone's short term TP: RM 1.50

Cheers and happy trading.


Wednesday, 16 October 2013

KLSE October's Spot Picks - Part 2 - TA Enterprise

While the debts are looming around the corner of the world, the US government are still sitting in a deadlock position that hadn't seen any solution for the stalemate, while their debt ceiling are giving some breathing space for a temporary rise, good enough for a one day party and bad enough to keep the world in a hostage position.

Do you think that the world economy is just too big to fail? Do you believe that politician will work out on something in curbing one of the "might be biggest" downfall of the history? That is something for you and me to think about. But overall speaking, the market is always volatile as no volatility will not benefit the market at all. I think you will agree in this.

M&A topics are always the hottest and most highly speculated in the share market. While there are a couple of high profile M&A last year, I believe the appetite for M&A in year 2013 is still strong as there are still quite a number of fundamentally well company which are performing in terms of their financial, however, not so well for their share prices, which some may deem - Not fair.

As interesting as a merger and acquisition can be, probably I would like to highlight to you again on TA Enterprise Berhad, where their performance are still decent. TA had been involved in capital market, property and hotel business. And as of recent, the group had revise on their focus to be a major player in the upcoming property market in the coming days. While there are talks of TA selling off their stock broking wing, TA had been actively being accumulated by Datuk Tony Tiah which had saw the stock breaking the silent to rise from 50 cents region towards 70 cents.

While the media had been mum on the party that might be showing interest, we are looking at possibilities from ECM-Kenanga alliance to forge a triple pact stronghold, while not erasing chances of approach from investment bank like CIMB, Affin-Hwang or even the recent RHB OSK to enlarge their appetites towards the commodities market.
Standing at a NTA of RM 1.75 per share and fundamentally sound in their business, TA is a good target for accumulation as their share price technical had been showing a sign of up trend pending break out. I will be looking forward for another large volume day which will probably bring TA up in a solid manner above 70 cents in the coming days as it might trade into the RM 1.00 region in 6 months time frame. A quick and conservative calculation of 10% +/- appreciation from the current price will reflect TA in a short term target of RM 0.80 in the coming days.

Bone's short term TP: RM 0.80

Cheers and have a nice day.


TA - Fundamentally and Tactically Awesome

Monday, 14 October 2013

Movie Review - The Escape Plan

As the market rock, so do my weekend on the cinema platform watching a retired Rambo and an immortal Terminator with their old jobs again.

This time around - the Escape Plan, featuring Sylvester Stallone as Ray Breslin, together with
Arnold Schwarzenegger as Rottmayer in this movie trying to crack their way out of a prison that was specially invented by a crook to make sure no prisoners escape after going in. Well, after a series of Prison Break a couples of years ago with  Michael Scofield ever interesting plan in breaking from prison to prison, the tagline accompanied with 2 heavyweights from Rambo and Terminator definitely make this film a worth the penny.

This movie really able to crack some silly laughter in the cinema screen with Arnold Schwarzenegger playing a much "joker-like" hard core, big bad puncher character in the prison that meant serious business at his business, and the very observant, deep think tank, strategist, planner at Sylvester Stallone. Their mixed is really not bad as two heavyweights work together in a floating prison.

I am much impressed with Ray Breslin in this movie. Playing a calm and analytical person, his observation skills portray in this movie is excellent as into even counting the footsteps and behavior of the patrolling guard, while going to the max limit in exploring the weakness of the whole layout. I am again impressed with the planning that he can organized in the prison and camouflaging the plans like a crouching tiger hidden dragon.

This film is quite original and not much animated GUI that will spoil the rawness of the film. The plot is good, adequate of suspense and laughter in the movie, some unpredictable moves, adequate action and planning. Overall is a good film for the October month.

Bone's rating - 7.5/10

Have a nice Escape Plan.