Saturday, 21 January 2012

Jusco Alma On The Way?

As we know earlier, last year Aeon has purchased a piece of land from DNP land (Wing Tai) in Alma area to build a Jusco shopping complex. There is no indication when will the project start.

Back in December last year, lorries started to move in the said land and a thick layer of earth is being laid. Up until now, seems like the earth work is almost completed on the whole area of land. Will we see the construction of a shopping complex here soon?

     Main enterance from Jalan Rozhan

     Jusco Alma site: earthwork in progress

May be not so soon.

From the board at the construction site, there will be 25 units of 3-storey shop offices in this new commercial development, which will surely cost over RM1 million per unit by DNP Land. Besides, there are also 2 plots of  "Kamajuan Masa Hadapan (Lot Perniagaan)" and 1 plot of "Kemajuan Masa Hadapan (Pusat Perniagaan)", in which the latter should be future Jusco shopping complex. Thus, the complex is not confirmed yet, perhaps pending approval of plan.

This commercial development is located at both sides of Jalan Rozhan. If we look at the original Impiana Commercial Hub plan (which has been taken down from DNP website), there are exactly 25 units of shop offices at the Tesco side, with a big triangular area (Lot Perniagaan?) fronting the main road. Is the current plan remain the same as the old version?

       Old version of ICH masterplan

Currently, earthwork is carried out at both the Tesco and Jusco side. So, it is likely that the 3-storey shop offices will be built at the Tesco side. The construction of Impiana West has reached road-paving stage while Impiana East almost drainage stage as an average. Besides, the road widening of Jalan Rozhan in front of the Impiana Gallery is also on-going, and the nearby flyover by Gamuda-MMC is almost completed with 2 lanes opened to traffic now!

Should you buy a new property in Alma area?... Jesselton Hill, Permatang Sanctuary, Desa Impian, Tropicale Residency, Garden Residency, Hillpark Residences etc...

Friday, 20 January 2012

Win-Win in SP Setia

Now, the CEO and founder of SP Setia, Liew Kee Sin, has become an "offeror" in the takeover of SP Setia by PNB.

      Liew Kee Sin

This is the result of a revised deal whereas in earlier deal, Liew have to give up his 8% stake (158.2 million shares) in SP Setia to PNB. After the revised takeover, Liew will now hold on to his stake and continue to lead the company. Liew will be given a put option to sell his shares at the takeover price to PNB in three years time after the takeover, if he feels the need to do so.

As a result of the revised deal, the takeover price has increased 5 sen from previous RM3.90 to RM3.95 per share, while the warrant price will be revised to 96 sen from 91 sen. Thus, minority shareholders should be happier.

At last, they live happily ever after.. The End.

Wednesday, 11 January 2012

Sozo: Ready To Climb?

Sozo's share price has fallen almost 20% from 65sen in the end of December last year, not sure why. Currently it reaches its temporary bottom at 51sen, which is also its support line. The MACD starts to converge and RSI in very much oversold area.

Today Sozo has seen some sign of reversal in the morning session, backed by heavy volume. Will this Khazanah-backed stock stage a fight back?

        Sozo: on 10th Jan 2012

Tuesday, 10 January 2012

DRB-Hicom Tied Up with VW and Possibly Proton

A report from The Edge today: Volkswagen eyes 10% of local passenger car market. Is it possible?

In Malaysia, Proton & Perodua with their Saga, Persona, Viva, Myvi etc already snatch more than 50% market share of passenger car. If VW wants to share 10% of the market, then it must be at least as popular as Toyota and Honda here.

Most people here think that VW is a quality premium European car only for the rich. Recently-launched CBU C-segment Jetta is priced at RM150k, well above direct competitor like Civic and Corolla Altis. However, VW has signed an agreement with DRB-Hicom last December to produce CKD VW cars in DRB-Hicom's plant in Pekan which has the annual capacity of 96,000 and only 18% utilized currently.
The collaboration between DRB-Hicom and VW is said to be some where between 70/30. First CKD VW model to roll out will be VW Passat, then should be followed by Jetta. VW also plans to add 12 new models in 2012. It plans to position itself to compete with the likes of Toyota, Honda & Nissan, not those luxury Mercedes and BMW. VW is known for its quality and powertrain, if its CKD cars can be priced competitively compared to other Japanese makers, then it will surely attract more buyers.

Besides VW, DRB-Hicom also confirmed to bid for the 42.7% Proton stake held by Khazanah, along with Proton's chairman Mohd Nadzmi and ?Naza/Arumugam/Gerald Lopez etc. Looking at the list, it is rather easy on paper to predict who will win the bid. If successful, DRB-Hicom will have extra car manufacturing capacity in Tanjung Malim which is only 52% utilized.

If VW can achieve their sales target, then surely it will be good news for DRB-Hicom, who can also export the cars to ASEAN countries.

If DRB-Hicom acquire Proton, then it should be good news for both parties, with Proton strong sales volume and DRB-Hicom's strong financial and collaboration with VW.

      Proton Tuah: Coming Soon

Nevertheless, regarding VW cars external design... err... a bit out-dated.

     Jetta 2011: Civic in the 1990's?

Sunday, 8 January 2012

Can Small Fish Eat Big Fish? Can One.

Can One's share price has surged 54% in the first 4 days of year 2012, and it will certainly go further up next week.

Can One and Kian Joo has been involved in law suit since many years ago. On 6th Jan 2012, it is reported that Can One has won the case and is allowed to complete its proposed acquisition of 32.9% or 146 million  of Kian Joo's shares at RM1.65 each (currently at RM2.20).

The story of Can One and Kian Joo dispute is summarized here.

Can One and Kian Joo are both in the same business. As of end of year 2011, Kian Joo has a market cap of RM932.7 million, while Can One is at RM157 million which is about 6 times smaller than Kian Joo. If the purchase of the controlling stake in Kian Joo is successful, then Can One will legally takeover Kian Joo.

If Kian Joo's See's brothers know this day will come, they may regret quarreling with each other.

The "take over" should not has major effect on Kian Joo's business unless the whole management is changed into a lousy one. For Can One, it will certainly boost its earning and prospect.

Thursday, 5 January 2012

Can Notion Avoid Loss?

In its presentation for 2011Q4 financial results in Nov 2011, Notion warns that it may register a loss-making quarter in 2012Q1 (Oct-Dec 2011). This includes RM3million loss for damaged finished products, RM2million loss for inadequate insurance cover on machinery, and expected 45% drop in revenue for 2012Q1 due to the Thai flood.

Global major HDD manufacturers are badly hit by the flood. Most of them have factories in Thailand which produces about 60% of HDD in the world. Notion's factory in Thailand was closed down because of the flood. However, the plant mainly produce camera parts and it makes up only 3% of Notion's revenue. Notion mentioned in Nov that the forecast of reduction in revenue is mainly due to reduction in orders by its main HDD customers such as Western Digital and Seagate, whose production have ceased due to the flood.

      Flood in Ayutthaya, Thailand

Reduction in order by WD & Seagate should affect JCY as well. Though JCY's factory in Thailand is not affected by the flood, but if there is no order from customers, it is still useless even if the factory is in good shape. However, it turns out to be the other way round.

Since mid October, JCY share price starts its rally after reports saying that it will benefit from the Thai flood.  Besides the fact that JCY's Thai factory is not affected, the price of HDD has increased by 50-100% due to shortage of supply. Some source mentions that JCY receives a lot more orders esp from Western Digital. JCY's share price has gained almost 200% since Oct 2011.

Western Digital is also Notion's major customer. Why no one mention about Notion? Western Digital does not order from Notion because of logistic issue?

Yesterday, (4th Jan 2012), JCY releases its profit guidance for its 2012Q1 (Oct-Dec 2011). It expects its net profit to surge 1900% YoY to the region of RM120million, which will be 50% more than its previous record quarterly net profit. The reasons given are increase in average selling price, stronger USD vs MYR, effective product mix and efficient cost management.

Notion's discouraging presentation was back in November 2011. Has anything changed their forecast in December 2011? As in JCY's case, Notion should be able to benefit from increased selling price of HDD and stronger USD, and perhaps increased order recently???

      Notion in Klang

In the previous quarter, Notion has successfully acquired 3 new customers, at least to partly compensate the anticipated lower orders by existing customers. Its facility in Thai is expected to restart by Feb 2012. However, its camera parts main customer Nikon is also affected by the flood.

It's hard to predict how Notion will perform in the period of Oct-Dec 2011. Will it plunged into red because of those one-off losses, or will the damage be offset by higher selling price and demand for HDD?

AMedia: Get Licenses Without Share Placement

We know that in order to obtain the Digital Terrestrial Television Broadcasting license, Asia Media needs to do a private placement of 35% of its total shares in order to meet the 30% bumiputera equity requirement. This represents a massive dilution in its EPS.

However, the plan of private placement has been cancelled. Asia Media announced in 22 Dec 2011 that it has obtained the licenses and has been given the approval to transfer the licenses to Maha Semarak Sdn Bhd, which is  70% owned by Asia media. Datuk Wira Syed Ali Bin Tan Sri Abbas Alhabshee, who is the Non-Executive Chairman of Asia Media, owns the remaining 30%. So now the license holder is Maha Semarak which has 30% bumiputera equity.

The transfer of license will not affect Asia Media plan and operation. Thus it is a rather good news for its investors.

With the various broadcasting licenses in hands, Asia Media will have the rights to operate live TV broadcast and radio on Rapid KL's buses and trains. This is said to be able to boost its income on advertisement. It has started testing the service in some of the buses and expect proper service by second quarter 2012.

The live TV should concentrate on news reporting and talk shows in English and Malay, while the radio is planned to cater for Chinese market. Nevertheless, doing live TV broadcasting requires expertise and rather big investment. If this new concept is not well accepted by the advertisers and public, then it might affect Asia Media's earning negatively. Countries like Japan, Korea and Taiwan have successfully operated the live TV broadcast.

Asia Media is applying to be transferred to the main board of Bursa Malaysia. It will give the share price a boost if it is successful.

After a 18% surge in its share price to 33sen in 14 Dec 2011, Asia Media has corrected to 30sen which should be a support for it. Currently it is trading at 29sen. Is it a good time to accumulate AMedia shares?

        AMedia at support

Wednesday, 4 January 2012

Kg Buah Pala Compensation Compared

The Kampung Buah Pala saga is finally over.

Actually I have very limited knowledge on this issue. What I know is that the Kg Buah Pala land in Gelugor, Penang, was initially sold by BN government before 2008. However, the deal was confirmed by current PR government. The court then ordered eviction of its residents. 

The developer, Nusmetro is currently building a few blocks of luxury condominiums (The Oasis Condominium) at this site.

     The Oasis

There are 24 families finally accepted the compensation package which include RM8000 and a double storey terrace house at the same site, which is Gelugor in the Penang island. The value of the house is said to be RM500,000. However, I think it is at least 20% more than this figure now.

      At Gelugor: looks elegant

For the other 9 families who have rejected the compensation by the developer, recently the BN government has helped them to get double storey terrace houses as well, but the location is at Teluk Air Tawar, Seberang Perai. The terrace house is said to worth RM220,000. Anyway, if the undersea tunnel project materialize, its value may increase.

     At Taluk Air Tawar: looks ordinary

The same double storey terrace house, but a vast difference in its value. This is Penang island vs Penang mainland.