Award for Mah Sing

Below is the article from The Star:

KUALA LUMPUR: Mah Sing Group Bhd has bagged the Best Development Malaysia Award at the 13th International Property Awards 2007 in London.

It was awarded for its gated and guarded high-end residential development of Damansara Legenda in Petaling Jaya.

The results of the world's largest property competition were announced on Sept 14, and the awards were presented at a gala dinner in London's Grosvenor Square.

About 400 property professionals, representing 56 different countries, gathered in eager anticipation of winning one of the highly prestigious awards.

Mah Sing managing director Datuk Leong Hoy Kum said in a statement that the group was gratified to be recognised at an international level for its development.

"Awards and recognition like the International Property Awards, and the Forbes Best Under A Billion award, which we have won for the third year running in 2007, serves to encourage us and allow us to stand out in the crowded market place.

"We shall certainly be bringing more quality homes to discerning home buyers soon," he said.

The International Property Awards in association with CNBC is aimed to identify the very best in the residential property market.

Nextnation: Weak Q1 result

As expected, nX posted a very weak Q1 result. Below is the article from The Edge:


KUALA LUMPUR: Nextnation Communication Bhd’s net profit for its first quarter (1Q) ended July 31, 2007 fell sharply to RM611,000 from RM4.8 million a year ago mainly due to the rising operating costs for its wider geographical regions participation coupled with the higher technical expenses incurred from its restructuring process.

In an announcement yesterday, the company said its revenue was 24.1% lower at RM17.79 million against RM23.45 million a year earlier because of the delay in business transactions and projects as a result of the on-going restructuring process. Its basic earnings per share was 0.16 sen.

Going forward, Nextnation said the group would continue to focus on its technology, products development, service enhancement, market expansion, and maintaining strategic partnerships.

“The board expects increasing positive contribution from the group’s overseas operations in order to support business expansion,” it said, adding that the board expects a satisfactory performance for the remaining financial year barring any unforeseen circumstances.

Comment: I am wondering how long do they need for the restructuring? Once again, if it is well managed, restructuring should not be the reason for the extremely weak result. I also wonder what excuse they will use for the coming quarter. Restructure for a few years?

Oil & Gas Sector

The above sector is another sector that could be benefited from the high crude oil price recently, where it is still trading at above USD81 per barrel.


EPIC is among the O&G stocks that attracts my attention. Strong balance sheet and monopoly of services in Terengganu are the main factors. However, the ability of the management is still a big question mark. You may refer to Whereiszemoola blog for details analysis. From buying a business perspective for mid-term, EPIC should be a good bet. It is set to enjoy Eastern Corridor as well, which will be launched by PM by end of October.


Another attractive O&G stock would be Petra Perdana. With the acquisition of additional 4 vessels, almost all research houses released reports that give a BUY call to Petra Perdana. Averagely, the target price for Petra is above RM6. As a result, it has 20% upside potential conservatively. Everything looks correct now and the emerge of high profile substantial shareholder should be able to push the stock to higher level quicker. Petra has strong support at RM5 at the moment.

Property Sector

Personally, I believe the above sector will be the winner during the year end rally. By the way, let us hope there is no huge crash from now until year end. Otherwise, we may need to change our strategy again.

Property sector has been a hot topic since the waiver of RGPT, back in somewhere in April. However, quarterly results from the main players are not impressive enough. Perhaps it may take some times for the developers to enjoy better result from the incentive introduced by the Gov? Or maybe the cycle in Malaysia is not correct where HK and Singapore have been enjoying the great development in this sector since 2 years ago?

With the uncertainty of global economic and market at the moment, do the effort from Malaysia Goverment will be enough to support property sector? What will happen to all the high-end projects if economic crisis hits the global market in next 2 years?

Base on historical data, it shows that the crisis hits every 10-12 years. It is 2007 now and the crisis may come the latest by 2009? How many of the high-end projects can be completed by 2009?

Anyway, I believe Mah Sing offers good buying oppurtunity now. The stock price has been in huge selling pressure after the substantial shareholders, Felda continues to dispose their holdings in recent weeks. Perhaps they need the money to buy the en-bloc of The Icon @ Tun Razak? From another prespective, Capital Group is still holding tightly and the price is still below some of the acquisitions done by them. It should be a great value to buy with current price.

Meanwhile, according to Oriental Biz, d7 - a project by YTLLand is selling like a hot cake in the pre-launch. Within an hour, a total of 100 units were 'swept way' by the buyers. YTL Land should be another good bargain hunting stock at currect price as the prospect of Sentul area is good. YTL Land has huge landbanks in Sentul.


Lastly, if you prefer to bet in Northern area, E&O, Asas Dunia and Equine should be in the shortlist. Asas Dunia have landbanks in the mainland while Equine will be enjoying their 20% stake in the company which will be developing PGCC. Even though both Asas Dunia and Equine do not have strong financial results in the past, they have big potential in the future ...

Nextnation - Q1 result

It is the time for Nextnation to release their Q1 result in this month, September. As I mentioned before, I have sold all of my holdings in the company a day after their Q4 result, back in June.

I also noticed that some of the investors still holding it as they believe there is nothing wrong with the business model of the company.

I went through some of the websites of nX and found that there are not much changes or progress to the company. They even removed their release where the CEO, Mr Tey comments about their Q4 result - where everyone can remember that the company incurred net loss for the first time(I think it should be around RM0.4mil?). Prior to this, nX has recorded net profit of RM4mil consistently every quarter.

I believe their venture into China is a failure as well. If I can remember correctly, the JV in China has been called off. Furthermore, I never see any progress and development over there. The mobile game portal - mostar should be considered as a failure too. You hardly see any development and the forum is really cold, with not much gamers having discussion there.

What do you expect from the coming Q1 result? Amid our mistake early before too late?

Fundamentally, I believe this stock is at the end of the era. But who knows speculators may push up the price in the future?

In conclusion, I think it is not worthwhile to keep holding it as they are many other attractive oppurtinities outside there. Property sector? Oil and Gas sector?

Just to share a meaningful quote from my friend - 'Not all good counters make you money, but those make you money counters are good counters' It is the fact, isn't? Happy investing ....

Petra Perdana Bhd

Below is the daily report from HBDS:

Petra Perdana: Better earnings visibility with newly acquired
vessels
(Buy; PETR MK; RM4.94)

􀂾 Story: Petra is acquiring five new vessels for RM323.5m. The
new vessels provide better earnings visibility and they are well
positioned to benefit from the growing demand for offshore
vessels and rising vessel charter rates.

􀂾 Point: The new vessels will be placed under the sale and
leaseback arrangement. Assuming an average charter rate of
US$1.8/bhp for FY08-09, we estimate an average EBIT margin of
31% from the new vessels. We have upgraded our FY08-09 net
profit forecast by 8% and 7%, respectively to factor in the
contribution from the new vessels.

􀂾 Relevance: We expect Petra’s gearing to remain stable at 1.3x
for FY07 and 1.2x for FY08. We reiterate our BUY rating for
Petra with an SOP-derived target price of RM6.40/share based on
targeted 20x FY08 PER for marine services. The key re-rating
catalysts for Petra are:- (i) rising charter rates, (ii) expanding fleet
size; and

Budget .. Property sector .. Global Market ...

EPF withdrawal

With the approval to withdraw money from EPF Account II for purchasing property, would it push the property sector to a higher level? Personally, I believe the demand for property will be higher as the potential buyers will have higher purchasing power by utilizing the money available in their EPF Account II.

2k?

However, the 50% discount for the stamp duty of property with value not more than RM250k is pretty immaterial in my opinion. With reference to the article in local newspaper, the discount represents a total of max 2k and it is only eligible for 1 property each individual. Is 2k that significant to a buyer who can buy a 250k property? I am not able to see the importance and I believe this has no major impact to the property sector.

Higher brokerage fee in 2008

Meanwhile, the min brokerage fee will be RM40 per transaction, starting Jan'08. I have no idea why the gov decided to increase it. Retails investors may be reluctant to pay for the higher brokerage fee where it has a direct impact to the net profit/loss for each investestment/trade.

Global Market

US market market gave up ~250 pts after the release of not impressive payroll data on Friday. China market dropped as well on Friday. Osama video clip may appear on 11 Sept? Will Fed cut the interest rate on 18 Sept? What will be the direction for global stock markets? We can deny that Malaysia market continues to be influenced by the global market at the moment.

The collapse

Personally, I believe the real huge correction will come after next year Beijing Olympic. Meanwhile, I am discovering and learning to join US stock market and options. You may visit optionXpress to look around. US market is more volatile and easier to make money? In the other way, it would be easier to lose money as well.

No Sin Tax

It is the first tax the gov did not raise the sin tax in Budget presentation? hooray for drinkers and smokers ....