Wednesday, 31 December 2014

Wishing You a Happy New Year 2015

Our thoughts will always be with the family members of the flood victims and passengers of QZ 8501, MH 370 and MH 17.

May God Bless Malaysia in 2015

Thursday, 27 November 2014

Nicorp - A Tale of 3

Nicorp had finally saw an even solid development with the emergence of Ar. Hud bin Abu Bakar as the executive director of Nicorp.

So who is Hud Abu Bakar actually?

Nicorp - Foraging into Properties?

Ar. Hud Bin Abu Bakar is one of the core principal for the well known architecture firm - RSP Group. A UC Berkeley graduate with Master of Architecture in 1988, Hud Abu Bakar had been putting in different taste of designs and creativity into the masterpieces and land marks in Kuala Lumpur.

Under his belt, he had proven his abilities through spectacular landmarks like Felda Tower, Miti HQ, Menara BIMB, Matrade Center, Paradigm Mall, KL Hilton, Le Meridian Hotel, Great Eastern Mall, Platinum Park KLCC and many other top notch development that had been undertaken by reputable developer.

His work recognition had earned him distinguish awards such as FIABCI award, Asia Pacific Property Awards, PAM Award and The Edge Dream Home Award.

With his current appointment as the Executive Director of Nicorp, bringing his expertise of architecture and designs with him, Nicorp will be marking for a remarkable come back. After a series of rife speculation on Nicorp which might possibly run into the oil and gas sector, the emergence of Hud Abu Bakar had definitely turn the game around and this time around, Nicorp will have a higher chance of foraying into the property market.

In the big property market with a lot of different players, a strong and above the par position will definitely put you ahead of any other competitor. While Tan Sri Liew Kee Sin will be always regarded as the life and heartbeat of SPSetia back then, his departure from SPSetia into EcoWorld had definitely left SPSetia as a company without the kind of vision that it used to have for a moment.

Hud Abu Bakar had been spending 24 years putting up stylish end into his artwork for big developers and government, and this could be a good time for Hud Abu Bakar to come out with another masterpiece, however, this time should be selling under his own flagship should Nicorp had become the intended vehicle for Hud Abu Bakar to take off his plans.

As one of the top notch architect in Malaysia, Hud Abu Bakar is highly sought after because of his inspirational and creative designs which had been never failed to deliver.

Now with the latest appointment as the executive director of Nicorp, Nicorp vague direction had just becoming clearer after a series of top management reshuffling. With a team that comprises of Dato Siaw Swee Hin, Dato Abdel Aziz and Hud Abu Bakar in the executive position in Nicorp, what will Nicorp become in the coming days had just became more and more interesting, while the current stakes are high that Nicorp might foray into the property development.

Looking at the development that had been happening in Nicorp, no doubt that Nicorp future development will be an interesting with big and bigger names appearing in the management level of Nicorp. At the level of RM 0.12, Nicorp will be a good price to lock into as the same price of private placement exercise that was placed out 3 months ago, while most of the accumulation from Dato Siaw and Dato Abdel Aziz had also been at the range of RM 0.115 to RM 0.125.

Deciding whether to buy a ticket for a Nicorp mega show down? You decide.

Bone's short term TP : RM 0.25 (Maintained)

Cheers and have a nice day.


Tuesday, 25 November 2014

Nicorp - Unveiling The Truth

Naim Indah Corporation Berhad (Nicorp - 4464) had finally started to unveil more solid corporate development in the public scene.

To recap, Nicorp had been slated to see a series of corporate exercise to restructure the company. After the fiasco from Raymond Chan in Nicorp, the company had finally seen a more solid direction under the lead of Dato Siaw Swee Hin now.

Dato Siaw Swee Hin had earlier buyout partial of the stakes from Raymond Chan on his disposal, while another small portion had been taken up by Quantum Discovery Sdn Bhd, which was then owned by Datin Khoo Lay Wah.

The latest development on 11th November 2014 had saw Dato Siaw Swee Hin, along with his brother, Siaw Sween Woon, taking over Quantum Discovery Sdn Bhd after buying out from Datin Khoo Lay Wah and her partners.

The buy out will see Dato Siaw having a direct stake of 39,172,600 shares and indirect stake of 67,847,976 shares from Quantum Discovery Sdn Bhd, totaling almost 14% in a short period of time.

While doing so, Siaw Swee Woon had also started to accumulate shares from the open market as to add up his interest from the indirect stakes that he owned at Quantum Discovery Sdn Bhd.

 The recent most encouraging moves in Nicorp had been the appointment of Dato Siaw Swee Hin as the Managing Director of Nicorp, and the complete exiting of Datuk Raymond Chan in Nicorp, paving way for an even solid development.

Let's take a look at the past and current price chart of Nicorp.

In fact, a quick look at Nicorp will suggest that Nicorp had a certain degree of corporate development that had been in the process to materialize back then at May 2013. Nicorp shares had been heavily traded in the month of May 2013, with daily transacted volume reaching more than 160 millions of shares exchanging hands, and touched RM 0.25.

However, due to the delay in the private placement process in which had just went through at RM 0.12 a share, Nicorp is now geared up for a mega change under the new lead of Dato Siaw Swee Hin.

The share price had been trading at a fairly rock bottom price at the range RM 0.12, considering the insider accumulation at the range of RM 0.115 to RM 0.125, and private placement exercise being placed at RM 0.12 as well.

Should Nicorp be able to hit above RM 0.145 with a strong breaking volume, then Nicorp will be heading to challenge the psychological barrier of RM 0.20, then RM 0.25.

I believe Nicorp is a worthwhile mid-long term investment. Despite it's pitiful fundamental outlook at the current scene, notable development and changes had been seen in the top level management and a visible white knight - Dato Siaw Swee Hin, who is a low profile businessman that had establish business in Malaysia, Singapore and Vietnam will be the main core driver in Nicorp.

Nicorp will be a good consideration based on
- Dato Siaw Swee Hin appointment as Managing Director of Nicorp
- Dato Siaw Swee Hin and brother, Siaw Swee Woon buying over Quantum Discovery Sdn Bhd, increasing indirect stakes to 8.78%
- Complete exit of Datuk Raymond Chan in Nicorp
- Executive Chairman, Dato Abdel Aziz's increasing interest in Nicorp and intention to deal with Nicorp shares at closed period.
- Private placement priced at RM 0.12 fully subscribed.
- Insider and director's accumulation being at RM 0.115 to RM 0.125.
- Potential RTO target for Alltrust International Berhad.

Nicorp will be looking good to challenge a short term TP of RM 0.20, while a longer term TP will be able to see Nicorp trading at RM 0.30 to RM 0.50 should there be more solid development.

Bone's short term TP: RM 0.25 (upgrade)

Nicorp - Throttle Forward

Cheers and have a nice day


Wednesday, 19 November 2014

SUCCESS - Lighting the Way Up

While global market had been in an upbeat mode, Malaysia had been trailing behind most of the party after foreign investor view Malaysia outlook as "a lack of catalyst" as foreign funds pared down holdings. However, with the month of November that is full of quarterly reports, would there be something that will be interesting to look out at?

It had came to me on Success Transformer Corp Berhad (SUCCESS - 7207), which is dealing with lighting and transformer will be a good company to be vested in with their bright business prospectus.

Let's have a look at their latest chart

SUCCESS had been in a gradual uptrend. SUCCESS had been consolidating at the range of RM 1.85 to RM 2.00 in a lower volume manner. However, with the tight consolidation focused at the range of RM 1.95, SUCCESS could be pending upon a break above RM 2.00 in the coming days with a strong anticipation on a stronger quarterly performance.

SUCCESS - Lighting the LED way

The latest trend had been going the LED way for cost saving and environmental friendly. Success Transformer Corp Berhad, being the largest LED Lightning manufacturer in Malaysia would be looking to see this trend as a booming prospect for it's business.

LED had been in a strong trend as of lately, and it's widely supported in the European countries as it consumes lesser energy while providing a brighter light, which in turn, reducing green house gases that had been a cause of global warming.

SUCCESS had been seeing steady growth in it's revenue since 2009.

According to the latest Q2 FYE 2014 performance, Success had been seeing a cumulative revenue of RM 189.6 million.

A quick simple calculation will see SUCCESS maintaining their 2014 performance will be seeing a possible revenue around RM 380 million, as EPS can hit a potential 28 to 29 cents. A quick valuation based on PER x10 will easily see SUCCESS being valued at the range of RM 2.80.

Currently, SUCCESS had been aggressively expanding it's network and production to Thailand and Singapore. SUCCESS is currently catering to more than 60 countries and will be looking to see more demand coming in to their door.

Based on the current outlook, SUCCESS will be looking to see a 15% to 20% growth in their revenue for the next 3 years, which could potentially hit up to RM 500 million revenue in FYE 2016.

In my opinion, SUCCESS will be a good fundamental company to be vested in for the long run, with good business prospectus, good management team, and good financial control within the company. A long term outlook will place SUCCESS at RM 3.00.

Bone's short term TP : RM 2.20

Cheers and have a nice day


Friday, 7 November 2014

Rsawit - On Diesel Boost

The economy outlook in the US continue to be fed with positive data after a lesser than forecast on unemployment figure that was released earlier. With Japan putting a surprising easing in it's market and the anticipation of the ECB to pull in a full blast stimulus, it looks like the bull will have no time to rest anytime soon yet.

While locally, industry that had been of hot focus lately includes semiconductor industry as well as plantation. With the current CPO price at around RM 2300 per ton, it will be great to lock into some position in the plantation company at the current price as anticipation of CPO price going higher  towards the end of year and beginning of next year.

Let's have a quick look at Rimbunan Sawit Berhad (Rsawit - 5113)

Rsawit had been trading at the RM 0.80 range before seeing a volatile CPO price and a sudden market correction that had brought the price down to the range of RM 0.67. However, with CPO anticipated to challenge higher in the coming days, Rsawit will be looking to challenge higher and retest the psychological resistance line at RM 0.80.

Rsawit - A Diesel Tale

Rsawit is a palm oil player that operates in Sarawak. The company is mainly controlled by low profile tycoon Tan Sri Datuk Sri Tiong Hiew King, in which he is holding more than 50% of the stakes in the company.

Rsawit had been in the red for the past few financial years, which is partially due to the aggressive expansion and expenditure in buildings of palm oil mills. Rsawit had a massive amount of plantation land bank in Sarawak, which is good enough to see them focusing on their existing land bank for new planting and replanting for the next 3 to 5 years.

Last year, Rsawit had around 31% of immature trees from it's total planted area of 54,659 hectares. This year, Rsawit will be seeing approximately 10% (Around 5400 hectares) of the young trees starting to contribute to the company's revenue.

Beside that, Rsawit will be seeing it's new palm oil mill in Miri that had commenced construction since December 2013 to be operational in the early first quarter of 2015, which will continue to contribute positively towards the company revenue.

The palm oil had taken a hit earlier in the end of August 2014, hitting a lowly RM 1914 per ton (In early September) as the government put initiative to put palm export duty free for 2 months to raise demand for the palm oil, a move that which had been successful. During the 2 months period, palm oil shipments to China soar by 121.7% while India imported 25.8% more, scaling down the growing worries of increasing inventories of the palm.

Current Catalyst

The government had approved the B7 biodiesel program faster than the expected. The B7 biodiesel program will officially starts on November 2014 for Peninsula Malaysia and December 2014 for Sabah and Sarawak. B7 biodiesel program means a mixture of 7% biodiesel and 93% diesel for the diesel that is being retailed in the petrol station.

The implementation of B7 biodiesel will be seeing at least 600,000 tonnes of biodiesel consumption a year.

On the global note, Oil World executive director Thomas Mielke had quoted that the palm oil industry will be facing a major challenge in meeting the global demand for oil and fats by 2018. Thomas Mielke estimates that a total of 32m tonnes of palm oil will have to be produced to satisfy the global demand by 2025, and that the world will be facing shortages by 2018 if there are no acceleration in planting and replanting in the Southeast Asia.

Examples of others plantation leaders starting to move upwards in accordance to the CPO outlook in the coming days.

1. FGV

2. Genting Plantation

3. HapSeng Plantation

In short, CPO will be seeing a good demand in the future outloo. Rsawit will be a good option to be invested into given the current price based on
- B7 biodiesel program kick off in November 2014 for Peninsula Malaysia and December 2014 for East Malaysia
- Rsawit Palm Oil Mill to be operational in early quarter of 2015
- Rsawit to see approximate 10% of young trees to contribute to the productions
- Rsawit huge land bank will be good to occupy them for another 3 to 5 years in new plants and replanting activities
- Upcoming festival events (Christmas, New Year and Chinese New Year) to boost consumption
- Rising demand of CPO from global demands

Bone's short term TP: RM 0.80

Cheers and have a nice day


Wednesday, 5 November 2014

Syscorp - Rising with Cheap Oil

The latest hot topic in the market will be the on going oil price that had been sliding cheaper and cheaper as prices hit below the production cost for some of the oil companies. Currently, WTI Crude for December is trading at USD 76 per barrel, putting more pressure on the oil and gas companies.

While the cheaper oil prices is definitely a double blow to the high capex nature of the oil and gas industry, it would be another part of the story for industry that are using high amount of fuel and oil for their daily business activities.

Of course, the easiest to come into mind will be airlines industry, but the party will not be completed without the shipping companies celebrating as well. With this in line, SYSCORP is a favorite target after seeing it's subdue prices prior to the previous sell down with much upper growth for capital appreciation in the coming days.

Let's have a quick look at SYSCORP price chart.

SYSCORP had been consolidating at a wide range around RM 0.50. While most of the accumulation of the shares is being done above the price of RM 0.55 and RM 0.65 back then at July, SYSCORP will be seeing a better come back with a stronger volume in the coming days. A quick outlook will place SYSCORP into challenging RM 0.65 before breaking into higher grounds.

SYCORP - Greater with cheaper oil

SYSCORP had been known for it's ship building, maintenance, repair and overhaul, shipyard building and also shipping services. SYSCORP is currently the only logistic company that had the greatest exposure in the booming economy in the Samalaju industrial area in Sarawak.

A quick recap, SYSCORP had already started their services in the Samalaju Port with 2 barge berths and a roll-on, roll-off ramp. The facilities is able to cater for 450,000 tonnes of cargo for this year. While doing so, SYSCORP had secured 2 major building packages for the port project, propelling them to have the first mover advantage at the port, which will be expected to be fully operational by 2016.

SYSCORP also provide freight forwarding services in Indonesia through a 49% stake in freight forwarder PT Baruna Adipras for a good cut at RM 1.35 million. Currently, SYSCORP is seeing commodities such as animal feeds and related food products trading between Indonesian ports. However, SYSCORP will move into the iron ore trade which will be more lucrative.

With the sliding oil prices, it is significant enough to see major cost saving in the daily operation of the shipping activities. Shipping companies are benefiting from the cheaper oil that will put a stronger quarterly in the coming days.

1. Harrisons Holdings (M) Berhad (Harison - 5008)

2. MISC Berhad (MISC - 3816)

3. TASCO Berhad (Tasco - 5140)

While at the Airlines Industry, AirAsia had definitely reflect the opportunity from the falling oil prices in their share price.

SYSCORP had seen growing demand in the freight forwarding sector, ship building as well as a growing demand in the maintenance division.

With a strong growing revenue in the freight forwarding division, growing business in shipbuilding and ship repairs and maintenance, coupled with a series of cheaper oil, SYSCORP is killing 4 birds with a stone now.

I believe SYSCORP will be a good company to be vested in at the current level. With a strong growing revenue, almost 40% towards is NTA, SYSCORP will be coming under investment house radar in the coming days after it's huge exposure towards the booming economy of Samalaju and the growing demand of MRO in shipping.

Syscorp - Rising Sea Dragon
Syscorp - Sizzling On Samalaju

Boarding SYSCORP? You decide.
Bone's short term TP : RM 0.65 (Maintained)

Cheers and have a nice day


Monday, 3 November 2014

November Highlight - KFM - A New Season

The global equity sentiment had taken another solid step after seeing a series of encouraging economic data from the US and a huge 80 trillion yen (USD 726billion) monetary easing from Japan. With the European Zone likely to announce the European stimulus in the coming days, the bears are likely to see no chance for the coming period of time. On the Halloween Friday, DJIA climbed another 195 points to end at a record high of 17390.52 while S&P 500 conquer above the 2000 mark, putting a notch at 2018 points as Nasdaq took a foothold at 4630.

With the bullish state of economy, the equity market confidence is back stronger now after seeing the previous plunge as a correction in the midst of a bullish run. While most of the company are going to report in their 3rd quarter earnings, it is definitely another interesting journey to hunt on company with on going corporate development, for this month - Kuantan Flour Mills (KFM - 8303)

Am I going to talk about Flour market? Let's see.

Let's have a quick look at the latest price chart of KFM.
KFM had recently saw some noticeable volume with more than 8m shares exchanging hand in a single day back then in the period of March to April 2014. However, KFM had took a 6 months consolidation which had saw a lower transacted volume during that period. As the consolidation came to a saturation, KFM is now on the way to test the new heights in the coming days. A quick resistant at RM 0.60, once broken, will see KFM trading into the uncharted territory.

KFM - A Brewing Season

KFM had been involved in the manufacturing, milling and trading of flour products. However, due to the intense competition in the flour market due to the product being a controlled item by the government, KFM will need to look out of the box for the on going prospect of the company in the future. KFM, currently a listed company with a market capitalization of RM 31 million with 67,229,084 shares and 21,299,926 warrants with almost no noticeable long term debts notes in the company balance sheet could be just another interesting target that is being eyed upon from tycoon to make a quick debut into the listed market.

The emergence of Dennis Tow Jun Fye as one of the substantial shareholder in KFM with 9.251 million shares (14.2%) is a confirmation that will see KFM looking to expand into other sector in the coming days. Dennis Tow Jun Fye is the son of Mr Tow Kong Liang (right inset), who owns and operate the well known Seasons Apartment Hotel Group under the listed entity IEQ which is listed in the Australian Stock Exchange.

Mr Dennis Tow Jun Fye, young and vibrant graduate from Deakin University with a bachelor degree majoring accounting and finance, he currently held various directorship and senior management position in Seasons Apartment Hotel Group and IEQ (International Equities Corporation Ltd).

With the latest stint of open market purchases of KFM shares, Dennis Tow had certainly ready to bring his expertise of property development and hotel management into KFM.

Brewing the Warrants
The latest conversion of KFM-WA warrant with an exercise price of RM 0.51 had put the game into an even exciting manner.

The massive conversion of the warrant (Currently 2,082,500 warrants converted) with an exercise price of RM 0.51 with an average purchase price of RM 0.125 on the warrants had put a total acquisition cost of RM 0.635 for KFM mother share, which is around 25% premium from the market price of the mother share.

To recap, KFM had earlier noted that the company will be placing out 10% of the total issued share for private placement in a Fund Raising Exercise. In order to get the maximum effect of the 10% private placement, KFM must increase it's total shares issued through the conversion of the warrants. Should all the warrants be converted, KFM will be able to place out 10% private placement based on 88,529,010 issued shares, which will be issuing 8,852,900 of private placement shares, enabling the company to raise more fund with more shares issued.

Now, one might be wondering what will be the fund raising activities lead to in the coming days? To expand their current business dealing with flour, or a new business direction in the coming days?

According the the prospectus of the private placement, KFM will be changing their business direction and to be largely dependent on it's future corporate exercise which will include the undertaking of new potential business venture.
The emergence of the Tow family member (Dennis Tow) in the KFM shareholding is going to earmark KFM into future business prospectus which will be looking at
- Property Development
- Hotel Operation and Management

Apparently, IEQ had recently saw some activities in their recent share price which had jump more than 400%, putting the possibilities of IEQ joint venture with KFM into property development and or hotel operation and management.

The Upcoming Event

KFM will be going to conclude and finalize the fund size to be raised, and hence will be putting a price tag for the private placement.

According to familiar sources, KFM will be looking to raise around RM 7million, which will be looking to see the group acquiring new assets and also to strengthen the balance sheet in order to secure a bigger financial lending in the coming days.

Should KFM be looking to raise RM 7 million from the maximum placement of 8,852,900 shares, KFM private placement will be going to see at least RM 0.80 in order to reflect the fund raising amount.

Private placement price = RM 7,000,000 / 8,852,900 shares
                                          = RM 0.79

I believe KFM will be a very interesting company to look at in the coming days with more corporate exercise that is to be unfolding soon. With the bullish sentiment, entry of strategic shareholder, KFM will be worth to be invested for a medium to long term based on :
- Emergence of Dennis Tow Jun Fye as substantial shareholder in KFM, which is related to the famous and well known Seasons Apartment Hotel Group in Australia
-  Massive conversion of KFM-WA with exercise price of RM 0.51, and average collection cost of RM 0.125, putting up the insider accumulation price at RM 0.635
- KFM indicated for a change in business direction in the coming future
- Familiar sources indicating KFM to be looking to raise RM 7 million for new asset purchase and reinforcing the balance sheet, hence reworking to a placement price of approx RM 0.80.

Limit with KFM ? You decide!
Bone's short term TP: RM 0.80 (Potential Limit Up)

Cheers and have a nice day.


Thursday, 30 October 2014

Nicorp - Throttle Forward

The recent strong hit back of the bulls had definitely send the bears packing back into the caves. The global equity market had started to regain back it's confidence as investor starts to pour down their cash into some bargain hunt as the DJIA started to rechallenging the psychological 17000 again. Is the market too big to be crashed? Had the fundamentals of the economy change? Probably, these are some of the self asking questions for your to determine whether you are prepared to be fully vested in the equity market or not.

While the market outlook continue to be volatile, I would be my interest to look into company that will be going through corporate restructuring exercise, or is in the midst of restructuring. While the development in Euro continue to be my favorite research, the latest development in Nicorp might be another big hit in the market.

Let's have a quick look on the latest price chart on Nicorp

Nicorp had been trading below the price of RM 0.14 for around 1 year as it is pending for a restructure in the company. Previously, Dato Raymond Chan had been rumored to be restructuring the company with asset injection of 1Borneo Complex, however, had gone awry. With the price chart showing a syndicated accumulation within the price range of RM 0.115 to RM 0.13 in Nicorp, a convincing break above RM 0.14 with a good supporting volume will definitely mark a new journey for Nicorp.

Nicorp - Changing Trends of Wind

The latest corporate action that had rifled across the market had saw Dato Raymond Chan being relinquish of his position of being the CEO of Nicorp, and subsequently ceased to be a substantial shareholder in Nicorp as he had disposed his entire stake of 38,836,600 shares to Dato Siaw Swee Hin (acquire 28,836,600 shares) and Quantum Discovery Sdn Bhd (acquire 10,000,000 shares).

To recap back, few months back, Nicorp had underwent a private placement of 10% (70,203,000 shares) at the price of RM 0.12. Prior to the absence of CEO due to the redesignation of Dato Raymond Chan, a new face emerge as Dato Abdel Aziz @ Abdul Aziz Bin Abu Bakar is appointed as the Chairman of the company and acquired 9,434,000 shares, representing 1.22% of the company total shares issued. Dato Abdel Aziz @ Abdul Aziz Bin Abu Bakar is a former executive director of AirAsia. Currently, he is a non exec non independent director of AirAsia with a position as a member of the audit, nomination and remuneration committee.

Dato Abdel Aziz is also an executive chairman for VDSL Technology Sdn Bhd, which provides internet coverage for corporate tower and government offices blocks.

The whole development of Nicorp became more interesting when Dato Siaw Swee Hin raised his stake, acquiring a total of 39,172,600 shares representing 5.07% of the total share issued of the company from the open market and off market direct business dealing. Dato Siaw Swee Hin is a low profile businessman that had venture into Singapore during his earlier days as a marketing executive. Currently, he is the Managing Director of Alltrust International Group.

Alltrust Internation Berhad is a partner with NamHai JSC, which is dealing with the marketing and distribution of Vietnam Long Grain White Rice. Currently, NamHai JSC is the top 10 domestic rice player in Vietnam, and is able to hold a production of more than 1.5 million metric ton a year.

Alltrust Internation Pte Ltd is dealing with Interior Fit-Out & Mixed Construction Services, Oil & Gas, Chemical and Pharmaceutical equipments and will be expanding into providing mining technology and general import and export services.

Alltrust International Group had been growing steadily under the management of Dato Siaw, which saw the company enormous growth into different sectors of trades. With the coming up expansion, Alltrust International will need to more working capital to expand further and faster.

Speculation had been rife in what will happen to Nicorp in the coming days after much changes in the management of Nicorp and a significant stake up from Dato Siaw Swee Hin. Nicorp had been plagued in the red for the past years, and it is the desire of the company's directors to turnaround Nicorp after a series of red inks in the financial statement.

Will Dato Abdel Aziz through his corporate experience and connection be giving Nicorp a turnaround, or will be heroic Dato Siaw Swee Hin be putting a huge restructure in Nicorp in the coming days with his almighty Alltrust International Group.

Nicorp, currently with a market capitalization of RM 96 million and 772 million shares issued will definitely be a good vehicle to be RTO for a quick listing and business expansion through raising funds from the public. A similar example will see Symphony House Berhad (Symphny -0016) which had 660 millions of shares and a market capitalization of RM 125 million is a RTO target by Ranhill.

While Nicorp foray directly into the oil and gas sector might still be vague now, the possibilities of Nicorp being linked up with Alltrust International Group to provide services or equipment that caters to the oil and gas sector is still a good possibility to be eyed upon after seeing a huge stake up by Dato Siaw Swee Hin.

Nicorp will be a good company to be looked at for the time being as more corporate exercise, restructuring is going to unfold. The current entry of Nicorp is deem attractive due to
- Private placement at RM 0.12 fully subsribed
- Increase of stakes by Dato Siaw Swee Hin, with majority purchase price at RM 0.125
- Ceasing of Dato Raymond Chan as the substantial shareholder and CEO of Nicorp
- Appointment of Dato Abdel Aziz as the Chairman of Nicorp
- Appointment of Cheang Soon Siang as the executive director of the company. Mr Cheang is experienced in handling cash flow, working capital management and restructuring and recovery of credit facilities for corporate.
- High Speculation of Nicorp as a RTO target, with Alltrust International Group as potential target.

Nicorp should be looking to trade stronger in the coming days with more corporate development unfolding one by one. A quick outlook will place Nicorp testing at RM 0.15, while a longer term outlook might suggest Nicorp putting RM 0.30 to test.

Thrust in? You decide.
Bone's short term TP: RM 0.20.

Cheers and have a nice day


Monday, 27 October 2014

October Feature - Destini - Golden Destination

Many would had been in a puzzle on whether this is actually a start of the crisis, or just another mere correction in the market. The global equity took a severe beating in the last couple of weeks after seeing huge sell off with the DJIA testing on 16000 in one occasion. While in the local KLSE market, there are severe selling down, particularly in the Oil & Gas industry after the WTI Crude Oil and Brent Crude Oil slide into the border line of production cost. Currently, the WTI Crude is hovering at $81 per barrel while Brent Crude stood at $86. With this lowered crude oil prices, will it be a good opportunity to take on some position in battled down Oil & Gas stock?

Of course, for me, it would be definitely a great opportunity to scourge for good deal now, which is why Destini Berhad had caught my very attention.

Let's have a quick look on the latest chart of Destini Berhad - 7212
Destini had been trading at the range of RM 0.65 before the triggered panic selling that had caused it to plummet into the range of RM 0.50. Destini did saw a good range of support at the price level of RM 0.50, particularly with the share buy backs from the Datuk Rozabil Abdul Rahman. At the range of RM 0.50, Destini would be looking to climb back higher into the range of RM 0.60 after a quick consolidation at RM 0.50.

Destini - Turning Around, Moving Forward

Destini Berhad, formerly known as Satang Holdings Berhad, had came out from it's suspension with a series of corporate exercise including the entrance of white knight - Datuk Rozabil Abdul Rahman in turning over the company to become the one stop center for the supply of safety equipment and MRO services in the aviation, marine, oil & gas and defense sector.

- Defense division
The entry of Datuk Rozabil had definitely transform Destini Berhad into a very powerful vehicle in the marketplace after seeing major government contracts being secured by Destini's subsidiary company. More than 80% of Destini's revenue is from government contracts. The latest contracts that is secured from the Ministry of Defense Malaysia (MINDEF) consist of:

- 7th November 2013, Destini Prima Sdn Bhd accepted a letter of award from the MINDEF to provide the first line and above maintenance services for the safety and survival equipment for Royal Malaysia Air Force (RMAF) for a total sum of RM 95,027,217 for a period of 3 years commencing 3rd October 2013 to 2nd October 2016.

- 4th December 2013, Destini Prima Sdn Bhd accepted a letter of award from MINDEF to supply defense equipment for the RMAF for a total contract sum of RM 46,317,000 for  3 years.

- 6th April 2014, Destini Prima Sdn Bhd accepted letter of award from MINDEF for the appointment as one of the panels to supply the spare parts for "Non-Proprietary" aircraft to RMAF for a total contract sum of RM 98.85 million for 3 years.

While the government contracts is a coming in handy, Datuk Rozabil had been vying to push Destini's future revenue further into providing specialized services in the Oil & Gas industry by acquiring Samudra Oil Services and tapping into the MRO services.

- Oil and Gas division
With the shrinking down crude oil production in Malaysia and the gradual rising consumption, Malaysia will be ending up importing oil should there be no counter measure to increase the production of the crude oil.

This will definitely drive for a higher demand to see more exploration activities in finding more oil reserves, which will include deep water exploration in the coming days.

Samudra Oil Services, specialized in providing tubular handling equipment and running services which are vital to the overall process of the production of oil and gas. The services which involved the handling and installation of multiple joints of pipes to establish a cased wellbore and the installation of smaller diameter tubing inside a cased wellbore to provide a conduit for oil and gas to reach the surface. With Malaysia driven to see more drilling activities, well construction which require the increased complexity of tubular services coupled with a limited number of companies that provide tubular handling equipment and running services in both domestic and global markets shall open up a bright prospectus to Samudra Oil in the coming days.

Samudra Oil Services, which is a licensed Petronas contractor had recently bagged in a 2+1 year contract from Lundin Malaysia B.V to provide hammer services and equipment for it's drilling campaign, pushing Samudra Oil's order book to more than RM 600million.

- Maintenance, Repair and Overhaul (MRO) division
Destini is will be looking to see more MRO contracts in the aviation, marine and oil & gas industry. The recent acquirement of Techno Fibre Group and the 51% stake at Vanguard Composite Engineering is a significant move to see Destini's thirst to make it big in this sector, which comes in time with the new regulation that is set by the International Maritime Organization that all ship operators and owners need to abide by the ruling and change the on/off load hook release systems for lifeboats, which is mandatory from July 1, 2014.  (Source - ETP Pemandu)
Currently, Destini is receiving income from overseas operations which had stretched to Dubai, Australia, China, Singapore, Brazil and North Sea.

With Datuk Kamarudin Meranun as top 20 shareholder in Destini, Destini will be looking to bag in MRO projects from AirAsia Berhad, which is pending it's EASA (European Aviation Safety Agency) certification in order to expand it's services to the commercial aviation.

Destini will be looking to acquire the remaining 49% in Vanguard by the end of 2014.

Destini had recently saw massive open market purchases from Datuk Rozabil as well as direct business transaction from Datuk Lim Nyuk Sang @ Freddy Lim.

Datuk Rozabil had been actively purchasing huge tranche of shares in open market and direct business dealing at the price range of RM 0.60 to RM 0.65 through his privately owned vehicle BPH CAPITAL SDN BHD. Currently, Datuk Rozabil is holding 256,308,800 (32.06%) of stake in Destini.

The recent massive stake up of Datuk Lim Nyuk Sang had definitely put the whole development of Destini more exciting. Recently, the entry and exit Datuk Lim Nyuk Sang in Bornoil had saw a series of interesting development with the emergence of HapSeng as the substantial shareholder of Bornoil. Bornoil had since broke above RM 0.80.
Topping the shareholder list in Destini had saw several identical shareholder of Kretam Holdings Berhad, which is owned by Datuk Lim Nyuk Sang @ Freddy Lim. They are Wong Len Kee, Chua Peng Boon and BPH Capital Sdn Bhd.

Besides that, the infamous Datuk Ambrose Lee which had then swap SugarBun and NBT (North Borneo Timber) with Warisan Harta Sabah Sdn Bhd back then at 1997 had been sitting in the 5th position of the top shareholder with 30 million shares with his low profile vehicle - Victoria Capital Sdn Bhd.

With a huge stakes in hand from high rank political linked businessman in Destini, the game might just be going to get more interesting in the coming days.

With much great prospect laid infront and huge stakes from high rank political linked businessman in
Destini, I believe that it would be a great chance to lock in a position with Destini when it is below RM 0.60, considering it's previous private placement with institution being placed at RM 0.60, and employee share option scheme (ESOS) being priced at RM 0.53, and massive open market purchase from Datuk Rozabil at the range of RM 0.65.

Destini will be looking to challenge a short term target of RM 0.60, and as more development starts to unfold within it, Destini will be potentially trading above RM 1.00 in the coming days.

Golden Destination? You decide.
Bone's short term TP : RM 0.65

Cheers and have a nice day.


Friday, 24 October 2014

Euro - Writing A New Chapter

The global equity market had saw some hit back from the bull after seeing a strong sell off from the bear that had triggered panic selling across the board last week. The sell down featured a strong selling from oil and gas related counters as crude oil dipped lower, putting up a bearish outlook for the sector as the price will not encourage risky exploration, while some operator will tend to increase output to make up the losses with a greater volume, putting the crude oil lower with oversupply. Currently, WTI Crude Oil is traded at $80.52 and Brent Crude Oil at $ 84.71.

While waiting for the next event to unfold in the coming up Feds meeting, Euro had started to unfold with more solid news lining up in the corporate ladder.

As of the latest announcement, Euro had went through a corporate reshuffling in top management level, marking it's first major move to reshuffle the company directions into focusing on properties development from it's current business operation that had been dealing with corporate furniture and fittings.

Major changes that had taken place will be the appointment of Dato Sri Choong Yuen Keong@Tong Yuen Keong as the Managing Director of Euro Holdings Berhad. As a businessman by profession and owns several businesses involving in property development management and aluminium recycling, Dato Choong had a 30 years of extensive working experiences in the construction and the property development industry, which includes 11 years in construction site management and 19 years in the management of property development. He was involved in a few housing and commercial development projects including Taman Maju Jaya, Wisma Cheong Hin, Pusat Perdagangan Tasik Perdana and the most recent being Beverly Heights which is located at Ulu Kelang, Gombak.

The appointment of Dato Choong as the Managing Director in Euro will earmark the new beginning of Euro Holdings Berhad in their property venture.

Dato Tong Yun Mong (brother of Dato Sri Choong Yuen Keong) had also been appointed as an executive director in Euro. Dato Tong Yun Mong had more than 20 years of experience in property development and building construction, ranging from civil engineering works, earthworks and transportation for ready mixed concrete plant. He is the founder and director of Beverly Heights Group.

The board level reshuffling includes Mr Teh Hock Toh (pic) being appointed as the CEO for the manufacturing division which will continue on the manufacturing and marketing of office furniture and equipment with the Ms Foong Yein Teng as the CFO.

New comer appointed to the board will be Kevin Sathiaseelan A/L Ramakrishnan being a non-executive director, being a member of the audit committee.

Amongst those relegated from their executive position will be Lew Fatt Sin and his wife Law Sim Shee, Ng Wai Pin, Pua Kah Ho, and Lew Hin.

Let's have a quick look in the technical chart.
Euro had been seeing a strong support above RM 0.60, weathering the global equity sell down last week. Should Euro penetrate above RM 0.70 with a convincing volume, this will earmark a new stage for Euro. While the consolidation had seen saturation, Euro is on a high stake to pierce further upwards after a series of corporate ladder reshuffling that took place, strengthening the investor confidence in the coming up direction for Euro Holdings Berhad.

Coming Up
A series of corporate exercise will be certain to take place as it will be anticipated that Beverly Heights Properties Sdn Bhd will be injected into Euro to form a new division - Property Division. However, the injection will definitely comes with a price that is to be paid from Euro to Beverly Heights Properties Sdn Bhd, suggesting a capital restructure then private placement, or a right issue with free warrants. Euro will definitely need to go through a series of corporate exercise in order to inject Beverly Heights Properties Sdn Bhd which is carrying 30 acres of freehold land in the northeast of Penang Island, carrying a potential value of RM 1billion, and a GDV of more than RM 10billion in bag.

With the solid performance of Euro's share price recently, I would like to reaffirm on the potential of Euro in the coming days which will be coming in a stronger note.

Meanwhile, congratulation to the newly appointed management team in Euro as we believe they will drive the company into greater heights.

Bone's short term TP : RM 0.88 (Maintained)

Cheers and have a nice day.