Note: Cash balance approximately RM200 million or cash per share of RM0.76 and still building up because of cash dividend flow in from FIMACOR (3107) and consistent earning from plantation segment.
Target Price: 1. RM2.00 based on 8x PER for FY2011 2. RM2.00 based on dividend yield of 5% based on 10 sen dividend payout in 2011 3. RM2.00 - RM2.50 based on dividend yield of 5% if dividend payout 15 sen in year 2012.
Golden Agri-Resources Ltd is the world's second largest palm oil plantation with a total planted area of 442,500 hectares (including small holders) as at 31 December 2010, located in Indonesia. It has integrated operations focused on the production of palm-based edible oil and fat.
Founded in 1996, GAR is listed on the Singapore Exchange since 1999 with a market capitalisation of US$7.5 billion as at 31 December 2010. Flambo International Ltd, an investment company owned by the Widjaja Family, is GAR's largest shareholder, with a 49.6% stake in the company. GAR has several subsidiaries, including PT SMART Tbk ("SMART") and PT Ivo Mas Tunggal. SMART listed its shares on the Indonesia Stock Exchange in 1992.
GAR is focused on sustainable palm oil production. In Indonesia, its primary activities include cultivating and harvesting of oil palm trees; processing of fresh fruit bunch into crude palm oil ("CPO") and palm kernel; and refining CPO into value-added products such as cooking oil, margarine and shortening. Through its subsidiaries, GAR operates 36 palm oil processing mills, four refineries and six kernel crushing plants. It also has an integrated operation in China including a deep sea port, oilseed crushing plants, production capabilities for refined edible oil products as well as other food products such as noodles.
Gamuda is a leader in turnkey and B.O.T. civil engineering infrastructure and township development, with projects and investments in South East and Far East Asia, Indochina, South Asia and the Middle East.
We have delivered more than USD3billion of civil infrastructure, operate and maintain 230km of highways that serve more than two million road users daily, provide water supply to more than 2 million consumers as well as built more than 14,000 homes in our lifestyle townships.
Our scope of expertise covers highways and expressways, bridges, tunnels, dams and hydropower, hydraulic engineering and water treatment, railways and mass-rapid transit systems, marine works and ports, and building, which are delivered through general contracting, design & build, turn-key, as well as Build–Operate–Transfer methods.
We are also a major township and property developer with four township projects that will eventually provide more than 30,000 homes when completed.
Our emphasis on differentiation and value-creation, as well as on operational excellence has enabled the group to consistently deliver distinctive infrastructure and homes bearing Gamuda’s hallmark traits of innovation, superior quality, outstanding value and assured completion.
Trading Strategy For Gamuda- WD (RM1.35):- Expiry Date : Year 2015 Exercise Price= RM2.66 Gamuda : Target price given by some broker house range from 4.20-4.80 level.
If you think Gamuda futures performance will be able to benefited from Malaysia construction project e.g Mass Rapid Transit (MRT) and tunneling works of which Gamuda already has good track record ( includes the SMART Tunnel, Penchala Tunnel and Kaohsiung MRT). Then the Gamuda share price may be able to go up to RM4.20 - RM4.80 level from now on till the next 2-3 years.
Therefore, buying into Gamuda-WD may provide good return and leveraging effect. Assuming Gamuda shares price go up from RM3.60 - RM4.30 and :
Potential Return
Gamuda
Intrinsic Value
10% Premium
Current Price
Shares Price
2.66
2.66
1.35
3.60
0.94
1.30
-4%
3.70
1.04
1.41
4%
3.80
1.14
1.52
13%
3.90
1.24
1.63
21%
4.00
1.34
1.74
29%
4.10
1.44
1.85
37%
4.20
1.54
1.96
45%
4.30
1.64
2.07
53%
Note: the 10% premium given because Gamuda-WD will only expired in another 4 years.
6 month high and low price :- Gamuda 3.46 -4.26 Gamuda-WD 1.29 - 1.82
...Stocks opens sharply lower, bond prices rise, as nuclear crisis in Japan intensifies
INVESTORS CONCERN: WHEN CAN I ENTER THE MARKET?
My advise will be : get ready to invest and most of the time we won't be able to know the market can go down to which level. What we can control is our investment strategies. But before we move on to investing, it is good to know the following:
1. Know the amount that set aside for investment.
2. Know the potential risk/losses that you willing to take. (worst case scenario, at least to hold for 2-3 years)
3. Know the number of counters you ready to invest. (also depend on your investment amount)
4. Know the number of quantity in each counters you ready to invest.
5. Apply some dollar cost averaging method as follows:
Simple Investment Method (SIM) 1-2-3-6
Assumption:
1. If economy may deteriorating due to Japan nuclear effect, the equity market may drop up to 30%. 2. Whenever the economy recover, equity market tend to rebound 20-50% from the bottom. 3. The recovery will be very strong and at least for 3-5 years. 4. Invest in fundamentally sound companies with solid business model .
Let us divide our investment amount into 12 portions (1+2+3+6=12). Example : RM120,000 investment amount Timing to enter market:- 1. If market drop 5% - invest RM10K 2. Market drop another 5%-invest RM20K 3. Market drop another 5%-invest RM30K 4. Market drop another 5%-invest RM60K
Look for company with potential to pay out dividend for next 1-6 months to get some dividend income during this period of time.
GOOD LUCK!
Remarks: 1. Use your own strategy of which can let you feel more comfortable instead of trying to guess the right timing to enter market. 2.The above investment strategy allow you to exist either in step 1,2,3 or 4 whenever there is a technical rebound take place and the portfolio is making money.
Japanese Stocks Unlikely To Slump for Long: Strategist
(news from CNBC)
While it's still very early to tell what the impact of the Japanese earthquake will be, it is likely that the events won't derail the country's stock market, Olgerd Eichler, co-head of asset management at MainFirst Asset Management, told CNBC Friday.
Looking back at the 1995 earthquake centered around Kobe, where more than 6,000 died, the stock markets only took a few days to recover, Eichler said.
"I think it's not going to derail equities for the next several weeks," he said.
SAN FRANCISCO (MarketWatch) — Turns out the Dow Jones Industrial Average didn't go to 3,000. The bank and auto-industry bailouts didn't bankrupt the country. And the investment-banking business on Wall Street didn't collapse like a house of derivatives-marked cards after Lehman Brothers imploded.
On the two-year anniversary of the start of the bull market this week, it's worthwhile for investors to pause and reflect on some of the lessons we've learned since the great financial crisis of 2008 and early 2009.
Back on March 9 two years ago, gloom was overwhelming in the markets. Buy-and-hold investing had been declared dead. With stocks down 50% or 60% in the previous 18 months, and having fallen six months in a row, many investors were convinced the markets wouldn't come back in their lifetimes.
Older retirees and many investors had sold that January or February, at what we know now was precisely the wrong time to get out of the market. The pain of seeing their life's savings depleted in investment statements month after month after month had just become too great.
A relentless stream of triple-digit down days in the market contributed to the soul-destroying talk of unemployment, recession, depression and political chaos in Washington. A new president, who inherited the bailout program from his predecessor, struggled to maintain those policies — which proved correct — while a frustrated nation turned its ire on him.
And then, on a spring Monday of no real significance at the time, stocks bottomed out. Over the next few weeks the market would rise 20% as investors watched and argued about whether it was just another in a long line of false bottoms. It wasn't.
The painfully slow global recovery we've witnessed over the past two years, only now even starting to take hold, had been seen by the collective market at that point, even though nobody understood it at the time. That's the thing about turning points: You never see them coming.
Over the coming 24 months, the Dow Jones Industrial Average and S&P 500 Index would almost double, gold would add hundreds of dollars an ounce to a new record above $1,400 an ounce. And oil, whose massive rally had highlighted most of the decade before the crisis, went into hibernation until just eight weeks ago.
All of this against a backdrop of fear and concern about soaring deficits, the fragility of the world's major banks, Iran's nuclear capabilities and intentions, and the future of the entire European single-currency project.
At the same time, we've become enthralled by the iPad, and Twitter, and all the potential that the mobile revolution brings to how we live our lives — and, in the case of North Africa and the Middle East, how technology can effect social and political change.
The lessons for investors should not be forgotten. Buy-and-hold investment strategies did not survive for decades because they were fads. Investors who didn't sell and held on — indeed, continued to dollar-cost average — did quite well over the last few years.
Diversified portfolios will help capture the best market moves, gold and emerging markets in this case, while hedging against the worst, oil and blue chips during this cycle. And, most important, that the daily noise of news, opinion and protest we all live with, and which grows louder as we increasingly connect ourselves, often needs to be blocked out when making long-term or even short-term financial decisions.
Some people think anniversaries, like stock-market milestones, are just arbitrary dates and numbers that have little significance. But it's worth a moment to look up from our BlackBerrys on this one and think about how far we've come since those gloomy times two years ago. And how far we still have to go.
AEONCR (5139) Prices maintain well at RM3.80 level. It is time to pick up this counter before dividend annoucement in April 2011 ( within 2 months). Expect to announce dividend of 13 sen for April 2011 and another 12 sen in Sept 2011. Therefore, dividend for 2011 will be 25 sen and provide dividend yield of 6.5%.
KFIMA (6491) Prices drop even good financial result was released on 28/2/2011. However, we shouldn't worry as the fundamental of this counter still intact. Continue to accumulate.
INDONESIA MARKET BBTN.JK ( Indonesia:- Bank Tabungan Negara ) Price start to move to Rp1470 (+9.7%) since recommendation on 20-2-2011 (Rp1340). Accumulate when price weaken to Rp1420 and below.
EXCL.JK (Indonesia :- XL Axiata ) Today closed at Rp5900 (13.4%) since recommendation on 13-2-2011 (Rp5200). Accumulate when price weaken to Rp5600 and below.
BNGA.JK (Indonesia :- CIMA Niaga) Accumulate at this level Rp1720 as this price trading at PER of 12.5x based on forecast FY2011 EPS of Rp137.
Info : Equity = RM263,160,000 Minority Interest = RM162,678,000
1.) EPS of 7.63 sen. (excluding minority interest portion) 2) Cash position increase to RM204 million ( net cash position with amount up to RM150 million. AND the cash position WILL continue to grow at steady pace. 3) Stable business model. Two major business segments :- a) Security documents - monopoly business b) Plantation - solid commodity business
Annualised EPS of 30 sen and net cash position should be able to attract more mid to long term investors to look into this company with target price at least RM2.50.
KFIMA subsidiary FIMACOR reported outstanding result for its 3rd quarter result. Therefore, estimate FIMACOR will contribute around RM14 million profit to KFIMA. If add other business segment e.g plantation (expect to be better result thant last quarter), I think for last quarter, KFIMA can reported EPS of at least 7.4 sen ( annualised EPS of 0.25-0.29 sen).
Target price of RM2.00 given based PER 8x based of EPS of RM0.25. For higher band can move up to RM2.50-RM3.00 for mid-term target.
CIMBNiaga reported its FY2010 result as follows: 1. EPSqoq increase by 31.48% (expect to grow at this pace for another 1-2year) 2. FY2010 EPS of Rp106.46 (current share price trading at 17.4x PE) 3. Expect EPS for FY2011 grow by at least 20%-30%. Therefore, Target price for 2011 is Rp2035 - Rp2200.
Comments: Recap on my call on CIMBNiaga for Post dated 18-12-2010. Accumulate for level below Rp1900-Rp1560 because CIMBNiaga being the 5th largest bank in Indonesia will be able to perform better for coming 1-2 years. Secondly, only country with huge population can provide strong growth rate and I like that kind of MOMENTUM.
TARGET PRICE = Rp2,200:- 1. If the average purchase price is Rp1700 - +29% UPSIDE 2. If the average purchase price is Rp1800- +23.5% UPSIDE
Trading opportunities in Indonesia market: The daily volume traded in Indonesia is at least 3-4 higher than Malaysia share market. Therefore, certain active counter like CIMBNiaga may provide good short term trading opportunity for investor to make some money.
Example: share price from Jan 2011 - 18 February 2011 : Lowest = Rp1,440 ( 20-1-2011) Highest = Rp2050 ( 14-2-2011)
XL Axiata : Stock Code : EXCL.JK Price = Rp 5,200 No of Shares : 8,508,000,000
Background:-
PT XL Axiata Tbk. ('XL') was established on 8 October 1989, under the name PT Grahametropolitan Lestari. Its main business was in trading and general services.
Six years later, XL took an important step by setting up a partnership with Rajawali Group - a shareholder of PT Grahametropolitan Lestari - and three foreign investors (NYNEX, AIF and Mitsui). Its name was changed to PT Excelcomindo Pratama, with the provisioning of basic telephony services as its core business.
XL commenced commercial operations in 1996, primarily covering Jakarta, Bandung and Surabaya areas. This made XL the first private company in Indonesia to provide cellular mobile telephony services.
September 2005 was a major milestone for the Company. Upsizing on all fronts, XL became a public company listed on the Jakarta Stock Exchange [now known as the Indonesia Stock Exchange (IDX)]. Currently, the majority of XL's shares are held by Axiata Group Berhad ('Axiata') through Indocel Holding Sdn. Bhd. (66.7%) and Emirates Telecommunications Corporation (Etisalat) through Etisalat International Indonesia Ltd. (13.3%).
XL is now leading the industry as a cellular telecommunications provider with extensive coverage throughout Indonesia. It provides services for retail customers and offers business solutions for corporate customers, including voice, data and other value-added mobile telecommunications services. XL operates its network with GSM 900/DCS 1800 and IMT-2000/3G technologies. XL also holds a Closed Regular Network License, Internet Service Provider (ISP) License, Voice over Internet Protocol (VoIP) License, and Internet Interconnection Services License (NAP).
Other Information:-OPERATING MEASURES
Number of Employees (permanent & contract with permanent position) =2 ,360 Postpaid subscribers (000) =290 Prepaid sim cards (active and grace / million) =40.1 Total subscriber base (millio)= 40.4 ( rank 3rd place after TLKM and Indosat) ARPU blended (Rp 000) =34 Postpaid revenue/sub (Rp 000) =192 Prepaid revenue/sim card (Rp 000) = 32
Financial Highlight For Fy2010:- (as at 31-1-2011)
1. EPS : Rp 237 (FY09) > Rp 340 (FY10) + 43% 2. Total Asset = Rp 27,251 billion ( RM9.3 billion) 3. Total Liabilities = Rp 18,577 ( RM6.3 billion) 4. Equity = Rp 8,803 (RM 3 billion ) 5. Dividend payout policy= 30% of normalised EPS
Comments: a) Expect earning growth rate of minimum 20% for FY2011. b) Increase in subscriber base and prepaid and postpaid revenue due to increase in income. c) Expect record EPS for FY2011= Rp380 - Rp400 d) Target price = Rp6080 - Rp6400 based on 16x PER for Fy2011 ( upside 23% ) e) Therefore, any adjustment below Rp5000 will provide good opportunity to accumulate this counter.
Another Counter To Consider : TLKM.JK , Largest telco company in Indonesia. 52.47% owned by Indonesia government 1. Price = Rp7,600, Target Price 11,200 based on 16X PER of FY2011. (upside 47%) 2. Expected EPS FY2011 = Rp700
CIMBNiaga share price started to recover from recent low of Rp1440. A strong momentum push the share price to Rp1880 ( up by Rp310 or approximate;y 20%).
Estimate to post 4Q result by record EPS of Rp35 and full year EPS of Rp100. Also expect to have an average earning growth rate of atleast of 25% for coming years. Therefore, the target price for CIMBNiaga:
Good bargain hunting. Today high selling pressure push down the share price closed at Rp1750. CIMBNiaga just has the right issue ex-date on 29-12-2010 @ 1:20 share, price Rp1250.
The recent share price run up could be due to right issue exercise. Based on the chart, I would think that the share price between Rp1600 - Rp1900 could be a very good entry point and at reasonable PER of 15 +/- ( based on EPSRp112 FY2011 ).
Accumulate when the price is reasonable and wait for share price to go up when CIMBNiaga announce better result in its next financial results. Good Luck!
Traderszone4u will continue to identify stocks that can provide at least 15% return for investment horizon of 3 months - 6 months and also to provide value investing companies for time horizon up to 3 years. Stock selection will cover from : 1. Malaysia 2. Singapore 3. Indonesia 4. Hong Kong & etc
2011 will be an exciting year because market will continue it volatility and provide ample opportunities throughout the whole year.
5 November 2008, CIMB became the largest shareholder of Bank Thai Public Company Ltd and on 4 May 2009 renamed as CIMB Thai bank Public Company Ltd.
9M 2010 Statistic:- No of shares = 13,349million Net profit for 9M2010 = 893.6 million Baht EPS = 0.07 Baht
Closing Price = 3.24 Baht ( approximately RM0.324 per shares )
A turnover story is going to happen once the management able to focus on business expansion after series of restructuring and capital injection through right issue.
Earning pick up probably to EPS 20 cts. Potentially pay 10 cts dividend. TP RM2.40-2.60 based on 12-13 PER. Another selling point is TH Plantation still has plenty of unplanted areas for future expansion.
1. KencanaAgri listed on SGX and trading at SGD0.42. 2. Wilmar came in as strategic alliance in August 2010 by bought over 20% share offer at USD38 million ( approximately SGD0.35 per share) 3. Futures growth of the company will very much depend on it non-planted areas and young age palm tree.
Landbank and Planted Areas:-
Palm Oil Tree Age Profile:-
Futures Growth:-
Investment Strategic: 1. Investment Horizon 2-3 years 2. Potential upside : 43% - 78% ( Target Price SGD 0.60 to SGD 0.74 based on PE13x on FY2012 and FY2013 )
Commodity prices have been going up and cause inflation remain at high level . However, market eventually will adjust by itself and find a balance point to settle at the fair price for the commodity. With the surprise action taken by China government to increase the benchmark rate, it clearly show that the government do not wish to to see the people facing problem in buying expensive food items during the festive season.
Therefore, commodity market may going through a correction and this may give some impetus for profit taking activity before the end of 2010 and provide opportunity to buy on dip.
Ideas: The average selling price for CPO 4Q2010 = RM3200 ( an increase of 24% compared to 3Q2010). Therefor, ready to buy plantation counter when opportunity emerge and hope to see plantation company to report better financial result due to release on early of February. Counter : Golden Agri, First Resource, ( Singapore ), IOI, TWSPLANT, KFIMA and etc ( Malaysia)
China's central bank raised interest rates on Saturday for the second time in just over two months as it stepped up its battle to rein in stubbornly high inflation.
The People's Bank of China said it will raise the benchmark lending rate by 25 basis points to 5.81 percent and lift the benchmark deposit rate by 25 basis points to 2.75 percent.
The central bank said in a statement on its website (www.pbc.gov.cn) that the latest rate rise would take effect on Sunday.
The move came after Beijing said earlier in December it was switching to a "prudent" monetary policy, from its earlier "moderately loose" stance.
Analysts said the change of wording, along with a recent pledge by top leaders to make inflation fighting a top priority for 2011, could pave the way for more interest rate increases and lending controls.
"This rate hike demonstrates Chinese authorities' determination to keep inflation under control up front, or front-loaded tightening," said Qing Wang, chief China economist at Morgan Stanley in Hong Kong. "Compared to rate hikes in the beginning of next year, a rate hike before year-end will have a more tightening impact, as the interest rates on the medium- and long-term loans and deposits are reset at the beginning of each year according to the base rates."
The central bank said on Friday it will deploy a range of policy tools to head off inflationary pressures and asset bubbles.
To tame price pressures, China raised interest rates on Oct 19 for the first time in nearly three years. The consensus of analysts polled by Reuters this month was for three rate rises of 25 basis points each by the end of next year.
Along with playing a key role in the fight against inflation, policy tightening also signals the government's confidence that the world's second-largest economy is on solid ground, even as the U.S. and European recoveries remain fragile.
While almost all investors and analysts thought more policy tightening was coming, there was uncertainty about whether the central bank would raise rates before the end of the year.
The central bank opted to raise banks' reserve requirements on Nov 19 ahead of data which showed inflation hit a 28-month high of 5.1 percent.
"We expected a rate hike by the end of the year, though Christmas Day is something of a surprise—a rate hike is not normally on the wish-list for Santa Claus, but in China's case this is a prudent move," said Brian Jackson, economist with Royal Bank of Canada in Hong Kong.
"We think it is increasingly clear that using quantitative measures, such as reserve ratios, to rein in liquidity and credit has not been enough, and that adjusting the price of credit—that is, interest rates—is needed to get price pressures under control."
Chinese stock markets have shed nearly 10 percent since mid-November on concerns the government would ratchet up its monetary policy tightening in face of rising inflation.
China has also officially increased banks' required reserve requirements six times this year and restricted lending by them.
In addition, Beijing has taken a slew of steps to cool the property sector, trying to ward off a potential asset bubble.
