Stock Portfolio Ending 26 Jan 2007

Totomaster's stock portfolio has risen for the 4th consecutive week into 2007, this time it manage to outpace the overall market KLCI by a huge difference. Week on week, the Main Index has risen by 1.93% while my stock portfolio manage to close up by 4.27%. During this period, I bought an additional 3,000 units of TAWIN @ RM1.68, 1,000 units of TENAGA @ RM12.40 & dispose 4,200 units of MAEMODE-WA @ RM0.54 leaving my cash balance at RM5,239.71.

Over the week, LIONDIV manage to touch a high of RM6.55 before succumbing to profit taking to closed the week unchange. Announcements from Bursa shows Datuk Cheng Yong Kim, nephew to Y. Bhg. Tan Sri William Cheng Heng Jem has disposed 10,900,000 units on the 22 January 2007. Can this attribute the fall of the share price?

To date, BJTOTO has not much participated in the rally in anyway. Most blue chips has scaled new heights day after day but BJTOTO is rather quiet and lackluster. Since December 2006, the KLCI has risen approximately 10% but BJTOTO is going the other direction. Looking at the daily price chart below, BJTOTO has been on the downtrend since hitting a high of RM4.98 end of November 2006 and is currently trading sideways with range between +-RM0.10. In my opinion, BJTOTO should have bottomed out by now and is trying very hard to break out from the downtrend triangle. However, any sudden burst in price should be well accompany by convincing volume else it will fall back into the trend again. The downside for BJTOTO is very low for now but the near term target should be around the RM5+ region.

The huge surge in my week on week profit is due to a big jump in MAEMODE-WA. Over the week, MAEMODE-WA jumped 30% due to a good quarterly report and an announcement in its participation in designing and construction of a coal fired power plant in Indonesia secured by its subsidiary for an amount of RM29 million. MAEMODE has been a trading side ways since early October 2006 and has sinced attracted attention due to the announcements. My target for its mother share is at a minimum RM2 while its warrant at RM1+ due to its niche business model and its ability to secure projects overseas. It has also a recurring income from service and maintenance to a coal mine in Indonesia amounting to approximately RM60 - 70 million over the next 4 years. Over the years, its nett profit has sinced grew 50% compared to FY2006 and 100% compared to FY2005. Many analyst reported a "Strong Buy" in this company tagging a fair value at RM1.70 and I am confident that the price will reflect a stronger uptrend for now. A major concern is its borrowings of over RM150 million but looking at the rate of its growth, this should not be view as a huge problem.

TAWIN has hit a low of RM1.62 but manage to close the week at RM1.70. In the meantime, the copper price has risen from its low of USD5,600 per MT to close the week up 4% at USD5,825 per MT but still way back from its all time high of USD8,800 per MT. The rebound of the copper price was mainly due to a previous drop which has been widely overdone. Although TAWIN is highly speculative but I believe the downside is rather limited but the upside will be substantial as long as TAWIN manage to churn out good profits in coming quarters. The TA shows that the MACD is gapping up and will cross each other real soon.

TENAGA latest results was pretty impressive showing a nett profit of RM1.25 billion or an increase of 70%. Excluding the exceptional and currency gain of RM350 million, it still comes out to a cool nett profit of RM900 million or 22% over the preceding quarters. If TENAGA manage to sustain the similar earning (excluding any exceptional gain), its est. EPS FY07 : RM0.95; est. PE FY07 : 13x @ RM12.40. I think TENAGA should be able to trade around PE16 - 17x translating a fair value of RM16.00. Latest filing shows that the foreign participation in TENAGA is heading to the allowable threshold of 25%, this shows how optimistic are the foreigners towards the largest power producer in the country. And, if the goverment decided to ammend the foreign equity percentage, imagine how high the price will shoot up. If the foreigners are so optimistic, why shouldn't we?

Stock Portfolio Ending 19 Jan 2007

Last week, Totomaster's stock portfolio again underperformed the general market with a gain of 1.80% compared to the KLCI gain of 2.54%. During the week, I have made a disposal of WCTLAND @ RM0.84 and FABER @ RM0.63 at a gain of 20% and 5% respectively while making a purchase on TAWIN. The reasoning behind the disposal is I would like to streamline my portfolio for the coming 12 months and still in the midst of looking out for better investment opportunities that offer higher returns. I had a couple of them at hand but still require more analysing before I make my move. Of course, if I can't get any, I can always get back into those I had sold off earlier if the price retraces down to a more comfortable level. Over the week, 1 counter in the portfolio advanced, 2 declined and 1 remain unchanged.

LIONDIV made a good rebound from previous week back above the RM6.00 mark. In the week, LIONDIV has finally made an official announcement that they have purchase a 9% stake in Polaris, Australian mining firm for exploration in iron ore. Parkson Hong Kong share price has finally breached the HKD40.00 mark and trending up. With its huge cash hoard of more than RM1 billion, it is definitely a steal at current price. I am getting pretty excited wondering what will the coming quarterly results have to offer. In the meantime, BJTOTO continue with its downtrend and consolidation, I am still hoping it would trend further down to collect more of it.

With the transactions over the week, my cash balance has risen to RM20,579.56 leaving my exposure to equity at acceptable level of 78.49%. I would definitely pour the remaining balances that I have back to the equity market as I believe that every of my dollar and cent should be working hard for me!!

Ta Win Holdings Berhad (TAWIN, 7097, RM1.71)

Ta Win Holdings Berhad, manufacture and market enamelled copper wire for end users in the electrical products market. Copper, in general is a very ductile metal with excellent electrical conductivity properties. The term conductivity here, is the material's ability to conduct an electric current. Therefore, copper has been widely used in the electronics, automotive and household appliance manufacturing industries. TAWIN's copper businesses are located in Malaysia, Republic of China, Republic of Mauritius and Hong Kong. The manufacturing arm of the products are mainly located in Malaysia and China whereby the other offices are used to market its products.

Looking back at the results above, for the 9 months of FY2006, TAWIN was able to achieve an EPS of RM0.50 compared RM0.16 for the entire FY2005. With this excellent results, TAWIN share price was able to rally to a high of RM2.40 on 29 December 2006 before plunging and erasing all its gains soon on 5 January 2007. Is the syndicate behind the huge drop that erased 30% of its market capital in a day? The price soon drift further to end the week at RM1.71. Can the huge drop be related to the global commodity market?

Prices of copper are mainly volatile, whereby the average range for FY2005 is between USD3,000 ~ USD4,600 per MT and FY2006 at between USD4,700 ~ USD9,000 per MT. The copper price hit a 10 year high of USD8,800 per MT in May 2006 and it went lower to close at USD5,600 per MT this week. The major correction is mainly attributed to a slowdown in global growth but analyst believed that the copper price might see some rebound towards the end of 2007 going forward to 2008. One must also note that the commodity price is more of a "supply = demand" equation, whereby any disruption of supply or surge in demand could quickly push the prices back up or vice versa. However, at the moment, the copper supply has outpaced the demand thus surpressing the prices.

The copper prices tabulated in the table above represents the average prices over the 3 months period of review. In the first quarter of 2006, TAWIN made an EPS of RM0.105 at an average price of USD5,000 per MT. However, should the copper price dips further and remains at the level of USD4,500 per MT for the remainder of 2007, it should translates to an est. EPS FY07 : RM0.20; est. PE FY07 : 8x @ RM1.71. Cheap or costly? What I am trying to point out here is that should the copper price drops further, TAWIN's valuation is never stretched.

Berjaya Sports Toto Berhad (BJTOTO, 1562, RM4.70)

Berjaya Sports Toto Berhad, BJTOTO, is one of the 3 NFOs in the country, owned by tycoon Vincent TCY which has businesses ranging from property development, trading, leisure, stock broking, insurance and manufacturing. BJTOTO having a sole, concentrated and excellent business model currently leads the NFO industry in the country in terms of sales and profitability compared to its peers. In the past, the corporate governance within the Berjaya Group of Companies are rather questionable. Intercompanies loans within the VTCY stable has cause the price of BJTOTO languishing at the RM3.xx for a good couple of years despite BJTOTO being the fastest growing NFO with generous dividends and capital repayments. Previously, BJTOTO has borrowed a staggering amount of more than RM1 billion to BJLAND a couple years ago which has recently been pared down. To date, the borrowings by BJLAND has been reduced to a more acceptable amount of RM93 million which has to be settled by 4 August 2007 unless any further extension granted to it. These shows than the transparency has very much improved. Upon repayment of the final tranche of borrowings, minorities should expect another capital repayment equivalent to RM0.30 - 0.35.

Ever since the repayments by BJLAND, BJTOTO has carried out 2 capital repayments of RM0.50 each which has been strongly supported and cheered upon by the minorities. To finance the capital repayments, BJTOTO has made some bank borrowings but however, this should not be seen as a problem repaying them as BJTOTO is a high cash generating business. With this rate as shown in the tabulation above, BJTOTO will manage to repay all its debt by first quarter of 2008 and can continue to replenish its piggy bank.

Here comes the big question, can one company sustain a dividend of RM0.50 annually while only making an EPS of RM0.30? An additional of RM0.20 pay out will be equivalent to approximately RM260 million which has to be forked out from its piggy bank or hopefully not through bank borrowings. The concern would be the capability of BJTOTO to continue to finance its high dividend policy with its much depleted cash reserves. However, looking at the first two quarters of 2007, the dividend paid out is similar to the previous year and in the following next two quarters, I would hope to see the dividend pay out to normalise.

Some would say that VTCY is sucking the company dry with its high dividend and capital repayments. In fact, it is because of the nature of the business where not much capital expenditure is required thus, most of the profits are returned to shareholders. Then again, how would one judge companies like MAGNUM which has nett cash reserves of more than RM700 million but only manage to disperse a diminutive dividend of RM0.10 - 0.15 annually? Will its minorities ever see or feel the huge stash of cash in future? In my opinion, money in VTCY pocket is similar to putting back money into your pockets. Just as long as the financial health & transparency of the company is in good shape, with negligible debts and continue to generate good profits, I would not mind at all.

Stock Portfolio Ending 12 Jan 2007

Over the week, Totomaster's stock portfolio again posted a negligible gain of 0.11% compared to a drop of 0.10% on the Main Composite Index. Three of my counters closed unchange while the remaining one closed slightly up while the other one vice versa. During the week, profit taking on blue chip counters was very much evident. The CI made a low of 1,103 points before closing back up at 1,119 points. However, on the broader market, the Second Board & Mesdaq made some gains of over 1% week on week. In the same period, oil prices has also fell to a fresh low of USD 52 per barrel this week. Has the rally shifted to the 2nd liners & will the continuous fall of this "black gold" be the impetus for a bigger rally?

As my exposure on LIONDIV is the highest for now, I am kind of concern over its price performance recently. LIONDIV continues to drift lower over the mid of the week, made a low of RM5.45 but manage to crawl back up to close unchange week on week. I hope the worse is over for LIONDIV for now. I should not have bought LIONDIV in a hurry prior week without taking a further look at the technical side of it. If I have done so, I would have bought LIONDIV at a lower price!! The point I am trying to make here is one should be sound in both its TA & FA to get a better entry price into any respective counter, and this is what I should be improving on. It will make me look like a fool if I am to make the same mistakes in the future.

Stock Portfolio Ending 05 Jan 2007

This week, Totomaster's stock portfolio has risen a mere 0.67% compare to the Main Composite Index of 2.20%. The KLCI has rallied up to over 2% during the first trading day of 2007 and manage to stay at the current levels despite profit takings from major bourses across Asia and Europe.

Over the week, I have disposed TANJONG @ RM14.70 and it did manage to close at RM14.90 at low volume. The remaining proceeds are used to purchase LIONDIV @ RM5.85 because I think LIONDIV has alot more to offer compared to TANJONG. This week itself, LIONDIV has drop from the high of RM6.40 to closed @ RM5.90 last Friday. With its nett cash position of RM1.426 billion and its ever robust retailing and property development unit, I do not think the current price is justifiable. Excluding the exceptional gain, the 1st Qtr 2007 EPS is approximately RM0.115, est. EPS FY07 : RM0.55; est. PE FY07 : 10x @ RM5.85. Not too demanding noting that the share price of Parkson Group (Hong Kong) which has been scaling new heights everyday coupled with agressive expansion in China. In my opinion, the main reason for the drop is because of SC has rejected the Proposed Extension ("Rejection") against AMSTEEL & SILVERSTONE and shall commence with the de-listing procedures next week. However, this does not change the fundamentals of LIONDIV. Check out the tabulation below.

WCTLAND, the property developer arm of construction giant WCTE has recently gain attention due to its low valuations. Over the years, a major chunk of WCTE profits came from property development section due to its higher profit margins. However, investor chose to shunt WCTLAND due to its high debts, limited development and a slowdown in construction sector. It is normal for development entities to have high debts due to acquisition of land assets. It has been proven that WCTLAND is able to translate its assets to profits with its high end development. For financial year 2006, WCTLAND has managed to obtained a PAT of RM59.19 million couple with an interim dividend of RM0.05. Previously, WCTLAND has recently risen for the 6 days to acheive a high of RM0.825 on 28/12/06 and soon succumed to profit taking. During this short trading week, WCTLAND did drop to RM0.775 at low volume but manage hit a high of RM0.82 before closing at RM0.81 at the end. An interim dividend of RM0.05 is expected to be declared again in the coming quarterly results which is equivalent to 6.1% at current prevailing price. Trading at a steep discount to its NTA of RM1.22 and its dividend policy, I think WCTLAND should be able to trade above RM1.00 in no time in this current uptrend market. Check out it's homepage http://www.wctland.com.my for current & upcoming projects. Another thing to note is that WCTLAND has also been actively sourcing for recurrent incomes, in this case would be rental incomes; one of those successfully secured is AEON or to most people recognised them as Jaya Jusco.

This update is getting too long, will continue to blog on the other stocks in my portfolio in the coming posting.

Stock Portfolio Ending 29 Dec 2006

Well well, there you go... Totomaster's Stock Portfolio at the end of 2006. Not gonna blog too much on it for now, lets start afresh from 2007 onwards...

Mannnn... this blogging thingo is kinda difficult huh, maybe I'm not too much of an IT or a Computer Science person.

Anyway, hopefully this portfolio will outperform the current market & most important outperform the current prevailing Fixed Deposit rates...

Happy holidays!

Howdy 2007... Good Bye 2006

Heeya people, a Happy New Year to all.... welcome to my very first blog posting....

Before we continue further, let me at least introduce myself a little bit in the investing arena. I started investing in August 2002, starting off with a capital of RM90,000.00+. Not much from someone who has just graduated. Throughout the years, my investment has not been impressive at all. Plagued into buying of speculative counters like TANAMAS & PSCI causing my investment succumming into huge losses. So call "tips" from relatives & friends also brought my investment further down. As time goes by, I have learned that buying into speculative counters will NEVER bring you very far no matter how well informed & connected you are. You will always be the last to know and by then its a little far too late.

As of April 2006, my investment was down to RM60,000+, a lost of 34% from my initial start up capital. Guess my money is not working for me after all these years. Thats a huge & major dissappointment! Blame it on ignorance & stupidity but . . .

As of today, I managed to get back all of my losses through smart & fundamental investing! From today onwards, I will update my stock portfolio in this blog on a weekly basis for my personal monitoring & for all to comment.

Hope we will have a great year for equity in 2007!

Happy investing!