Saturday, July 30, 2011

Portfolio Update July 2011



Market is doing rather poorly since mid of July 2011, mostly due to debt ceiling concern in the US and worsening debt crisis in western Europe. However, i dont think market will collapse anytime soon.

July performance was good in the first three weeks, thanks to CI Holdings strong performance due to acquisition of its main subsidiary, Permanis by Asahi Group. However, due to poor market sentiment in the last week, some of my holding has taken the hit, led by Mahsing and YTLPower-WB.

Overall, both of portfolio still outperforming KLCI index.

Portfolio 1 = +21.9% (CIH, Mahsing, Padini)
Portfolio 2 = +43.6% (CIH, SOP, YTLP-WB)


Portfolio 1
Portfolio 2

Tuesday, July 26, 2011

KNM - RM17b oil project in Johor


KNM says it is forming a consortium with Zecon and either a Korean or Chinese contractor to build a refinery and an oil storage terminal in Teluk Ramunia

Kuala Lumpur: KNM Group Bhd and Zecon Bhd has entered into an agreement with Gulf Asian Petroleum (GAP) Sdn Bhd to build a refinery and an oil storage terminal worth a combined RM17 billion in Teluk Ramunia, Johor.

The deal, bound to cause waves of interest in the oil and gas sector here, came on a day when two other oil and gas projects were announced.The remaining shares in the firm is owned by Abdul Aziz Hamad Al-Dulaimi, the president of Gulf Petroleum Ltd, whose shareholders include Qatar General Insurance and Reinsurance Company, Al-Mana Group, National Petroleum Group and the banking arm of Al-Sari Group.

GAP, which on April 30 2010 obtained an approval from the Malaysian Industrial Development Authority for the manufacturing licence for the integrated petrochemical plant, is 50 per cent owned by Mubadala Capital Sdn Bhd (MCSB).

MCSB's controlling shareholder, Datuk Zainal Abidin Ahmad, is also the chief executive and controlling stakeholder of Zecon.

Petroleum Bhd and Kencana Petroleum Bhd announced a RM11.5 billion merger plan that will become the country's largest oil and gas (O&G) service provider.
In a late statement to the stock exchange, KNM said it was forming a consortium with Zecon and either a Korean or Chinese contractor to undertake both the projects.

The projects comprise a RM15 billion oil refinery and a RM2 billion oil storage terminal.
The refinery will have a capacity of up to 200,000 barrels a day and 525,000 tonnes-a-year polypropylene processing plant, while the oil storage terminal will have a capacity of 2.328 million cubic metres.

The refinery and the storage facility are expected to be completed within 40 months and 18 months respectively, KNM said, adding the refinery project will be funded by 30 per cent equity, with the balance funded through project financing or sukuk issuance.
To help cover some of the storage facility cost, KNM will also try to arrange a sukuk issuance of up to RM1.5 billion to cover project financing during construction, KNM said.

Apart from the KNM-Zecon announcement, Daya Materials Bhd said it had secured two supply and delivery agreements worth RM27.42 million from Petronas Methanol (Labuan) Sdn Bhd.
Elsewhere, China's largest petroleum refiner Sinopec Petroleum Services Corp (Sinopec) is reportedly poised to take a major stake in a planned RM2.06 billion venture to help develop a Petronas marginal oil field located off Te-rengganu.

The announcement comes merely weeks after SapuraCrest


Padini prepares for next growth phase

Written by Joanne Nayagam
Monday, 25 July 2011 12:10

KUALA LUMPUR: The hustle and bustle at a Vincci shoe store, even during non-sale periods, is a telltale sign that local fashion company Padini Holdings Bhd has come some distance from its genesis as a simple garment maker four decades ago. Its success in making its mark on the local fashion scene goes beyond the homegrown shoe label to its other house labels like Seed and Padini Authentics.

Despite an upward trend in its momentum, however, the company is setting aside the next two years to iron out the creases in its supply chain and logistics. “One thing that we are looking at seriously is making sure that the existing doors have good growth rather than [to] keep expanding,” said CY Cheong, creative director with Padini, in a recent interview with The Edge Financial Daily.

The step back from expansion to consolidation mode to perfect its core mechanics, he said, is necessary to ensure the group can grow faster and more efficiently.

Despite the medium-term goal of perfecting its internal systems, Padini has scored well on its financial report card.

The last four years have seen uninterrupted growth, despite the 2008/09 financial crisis. Between 2006 and 2010, revenue has risen from RM286.11 million in 2006 to RM520.88, an average of 16.2% a year. Net profit surged from RM27.69 million to RM60.97 million, representing a 21.8% compound annual growth rate over the past four years.

Its market capitalisation stood at RM717.12 million as at last Friday’s RM1.09 close, being 10.58 times earnings for its current year ended June 30, 2011, according to Bloomberg data.

Indeed, some 40 years after its founding, Padini holds the enviable record as the largest and most profitable of Malaysia’s listed homegrown fashion companies. The company began in 1971 as a garment manufacturing and wholesale concern. It entered the retail industry in 1975 with its flagship brand Padini, while its other successful brand, Vincci, was established in 1986. Its other brands include PDI, Miki and Rope.

With its eye set to win more business in the region, Cheong said the group knows its operations at home need to run even more efficiently.

“I would say we are in quite a transitional stage of moving from a domestic-based company to regional. And for that, the way of working must change. The supply chain issue must be something we can address, because when you talk about doing business overseas, late delivery can sometimes be a problem, and also logistic[s],” said Cheong, adding that the company is constantly looking at increasing same store sales though physical store expansion may not be as aggressive for now. Money will still be spent to keep existing stores vibrant, to continue attracting customers while getting its existing loyal customers to buy more.

Even though overseas revenues currently contribute less than 10% to Padini’s total revenue, the Dubai Vincci store in Diera City Centre, is on par with the group’s best stores in Malaysia, such as at Mid Valley Megamall, Sungei Wang Plaza and Fahrenheit 88 (formerly KL Plaza) in Kuala Lumpur, Cheong said.

Cheong: I would say we are in quite a transitional stage of moving from a domestic-based company to regional.


And there’s good promise for growth. Notably, Padini’s partners in the Middle East are local distributor heavyweights that also distribute more internationally-recognised labels. For instance, Al Shamsi Holdings Llc in UAE, Oman, Qatar and Bahrain handle Zara, Promod, Stradivarius and Women’s Secret, Cheong said. Padini also has other international partnerships in Morocco and Egypt.

He admits, though, that some of its partner operations abroad aren’t doing as well as the company would like due to certain gaps in its supply chain. The need to bridge these gaps was even more evident in the last six months, when the cost of manufacturing and raw materials escalated. As such, one of the group’s top priorities is to ensure smooth and efficient product movement, from manufacturing to delivery.

As a part of the internal restructuring process, Padini has invested in a management information system. In 2008, the company put out RM7.5 million to acquire the SAP enterprise resource planning system which allows it to streamline all its processes into fewer steps and coordinate sales based on past customer demands. “SAP has been implemented and we do see improvement and better control of our work process. We need probably another year for our users to get used to the system,” said Cheong.

As Padini develops its brand by creating a stronger foothold locally, the brand will continue to provide what has been the key to its growth thus far: adaptibility. “I think change is essential in order to keep the business moving,” said Cheong.

“It can be a big change, but you’ve got to feel that what your customers want and need is reflected in your product,” he said.



Tuesday, July 19, 2011

C.I. Holdings - I love it




CIH Holdings is the owner of Permanis since 2004 and has restructured the company from a lousy to a growth company, and now contributes almost 90% to group earning.

Brand Under Permanis = PEPSI, DIET PEPSI, TROPICANA TWISTER, LIPTON TEA, 7UP, BLUE MINERAL WATER, MOUNTAIN DEW, REVIVE ISOTONIC, BOSS COFFEE, MIRINDA, FROST & CHILLS.

Since the management already mentioned that they would like to expand further into full fledged F&B business, im expecting that they would like to introduce Frito Lays and Quaker Oat products more aggressively into Malaysian market. PepsiCo is widely know as the largest snack company through Frito Lays company. Thus, by having snack/food manufacturer company under CIH, would definitely complement their current business and create a better value to shareholders.

However, my only concern is acquisation of Permanis by Asahi, hopefully the management will put stop of this.

p/s = Tropicana Twister - Lychee, dont really like it, Fruit Tree Lychee much better. :p



Icon City phase two launch by September


KUALA LUMPUR: Mah Sing Group Bhd, the country's fifth largest developer by revenue, will launch by September the second phase of Icon City in Petaling Jaya, Selangor, featuring 570 units of serviced residences worth RM439 million.

Group managing director-cum- group chief executive Tan Sri Leong Hoy Kum is upbeat that the units, worth RM450,000 to RM1.2 million each or RM700 to RM800 per sq ft, will be snapped up during the launch.

The residences come with space sizes of 550 sq ft to 1,779 sq ft.

"The right product in the right location will always sell well. We are bullish on the outlook led by the Economic Transformation Programme," Leong told Business Times.


Leong's confidence is further boosted by the launch of the first phase of of Icon City last weekend, where sales of RM426.5 million were raked in.

Icon City is a RM3.2 billion integrated commercial development located on 7.93ha in SS8, Sungei Way, at the crossroads of the Lebuhraya Damansara-Puchong and the Federal Highway.

The project comprises 30 Jewels (seven- to eight-storey lifestyle shop-offices), Gourmet Street (one- to two-storey retail outlets), i-SoVo (Small office Versatile offices), serviced apartments, and mall, boutique hotel and office towers.

The phase one featured i-SoVo tower 3, where 80 per cent of the units, priced from RM599,000 were sold, as well as 30 Jewels and Gourmet Street.

Some 96 per cent of 30 Jewels, which is worth more than RM10 million each, and 37 per cent of Gourmet Street, comprising 20 retail outlets worth from RM4.5 million, were taken.

Due to overwhelming sales and demand for i-SoVo tower 3, Mah Sing is selling the second block under Phase Two, known as i-SoVo tower 3A, comprising 212 units.

CIMB Research, meanwhile, is maintaining its forecasts and target price of RM3.30 on Mah Sing, based on an unchanged target market price to earnings of 14.5 times, largely because of the impressive take-up for Icon City's phase one.

The RM426.5 million sales achieved by Mah Sing for the phase one make up around 18 per cent to 23 per cent of its full-year sales target of RM2 billion to RM2.5 billion, the research house said.


Friday, July 8, 2011

CIMB Research has Buy on YTL Power, TP RM2.80

Friday, 08 July 2011 08:32

KUALA LUMPUR: CIMB Equities Research has a Buy call on YTL POWER INTERNATIONAL BHD with a sum-of-parts target price of RM2.80.

It said on Friday, July 8 that YTLP is selling a 43% stake in its unit YTL Jawa Power Holdings to Marubeni Corp for US$224 million or US$1.5 a MW, which is a fair price.

The deal could be positive as the partnership will improve YTLP’s chances of clinching other Indonesian power projects.

“However, we cut our FY11-13 core EPS by 2-11% for lower contributions from YTL Jawa and higher WiMax losses. Our SOP-based target is now 2% lower at RM2.80 as cash received from Marubeni does not offset the drop in contributions from YTL Jawa and higher borrowings.

“We also cut FY11-13 net DPS by 31% to reflect a more conservative payout policy,” it said.

CIMB Research said despite the downgrade in its numbers, YTLP remains a BUY as it believe its share price already reflects the WiMax uncertainties and lower dividends.

It said there could be a re-rating on the back of M&A and positive WiMax developments.

Thursday, July 7, 2011

Padini - Buy back & Latest Portfolio



Just collected Padini again @ RM1.05.