Saturday, October 21, 2017

Hit Jackpot from Share Investment

Talk about share investment, my return stumbled badly yesterday afternoon after one of my heavyweight invested listed company got serious fire incident at the main factory. This is the first time in my life suffering so much loss from share investment.

As per quick phone interview with the company director published by the media, he expressed that there’s about 500 control machines were affected, estimated $150 million losses and roughly needs 9 months to recover! And their existing inventory can only last for 2 months.

Once this news spreads out yesterday noon, the counter share slumped 30% just within an hour and it’s been suspended due to hit the down limit. And it also hits the highest volume among the entire stocks, about 36.7 million shares transacted within an hour! Not only that, it also created the highest volume record since listed from 2005! Why majority of the shareholders has just a big reaction while fire incident is not something new for manufacturer?

Unfortunately, this is not the first time for this company to hit fire incident. The previous incident was occurred in Jan 2014, merely less than 4 years! And this time, the estimated losses and recovery time are at least 3 times worse than the previous fire incident!

To me, it’s not a big deal about the fire incident and one-time loss, as most probably they can be recovered 80 to 90% via insurance compensation. What matters me is the company reputation and customers’ order! With the production is affected for 9 months or more, how can they deliver the goods to customers as their inventory only can last for 2 months?

I’m not sure the current factory capacity % and number of control machines at Plant 2, 3 & 4, but the affected factory is the core production site which consists of 1,500 control machines and about 1/3 of the machines are affected by fire. Assumed the capacity is about 80-90% with another 750 control machines, they only manage to cover 75 – 150 machines capacity while the remaining 70-80% of productions are not able to fulfill after 2 months.

Put aside the trust and the upcoming 9 months affected income, if they are not able to deliver the goods to customer but the customers are growing, what will happen next? The customers will definitely approach other manufacturers for the orders, may be for short term. But if other manufacturers are aggressive enough, providing perhaps a better quality and price than this problematic company, what will happen next? That’s what I worry about.

The revenue can sure come back upon the rebuild of the machines and production. But trust and orders cannot once customers ran away. Unless the management is able to demonstrate the outstanding leadership and effective way to solve this production issue, else I think that’s it.

The company market capitalization is about $312m before slump, and now at $230m upon slumped. Can you see that? The fire incident has caused $150m loss but the capital is only $230m. It looks very attractive provided the management takes a prudent steps to pinpoint this issue by next week.

Well, crisis always comes with opportunity. I think most probably I’ll give it a small shot on next Monday to average down my buying price, regardless the share price slumps further, retains or bounces back. I personally think this company is still having a bright future, but perhaps I have to hold longer than I expected now.

Sunday, October 8, 2017

How to Fake Confidence

I watched a video lately from YouKu and found out there are 4 small key areas to boost (fake) our confidence from a seduction guru.


How? Basically you don't have to be loaded, smart and charming, just be self-confidence with the following keys:

(1) Always having a relax and steady appearance.
Your appearance will always look relax and steady, including stand and sit posture. You also responding your opponent's question in steady and pausing mode. By acting so, you are basically not worrying anything at all time, you can handle everything under relax and steady situation. Hence, it enhances the appearance confidence.

(2) Take care of your physical appearance / image.
Yes, you don't have to be good looking. Yet you don't have to wear too over or too casual. Just be yourself and pay respect to yourself. It proves that you can take care of yourself in the first place.

(3) Don't boast or compliment yourself automatically. Some people are lack of confidence and they afraid others cannot notice them. A person who are confident do not worry about it. The best way is to be cocky and funny, somehow people feel good about it especially women.

(4) Be humorous
Humorous is not about telling jokes or funny story. It's about demonstrating your self-confidence level, where it proves that you have nothing to worry about and that's why you have time to be funny. Well, this is the hardest part but it can be learned. You can observe and learn the leaders, normally they have absolute humorous and always bring cheers and fun to be public whenever they are around.

That's the simple 4 key areas to pay attention to. Have a nice weekend, folks.

Sunday, September 17, 2017

Malaysia Economy Is Getting Better or Worse?

As a Malaysian, we are happy to see our quarterly GDP has improved for the recent 2 quarters, 5.4% & 5.8% respectively.

By looking back the past 20 years GDP growth, actually Malaysia in average is able to obtain 5-7% GDP growth year-on-year. That is consider a stable and healthy growth under a developing country.


However, a lot of residents complained or felt that the local economy is not getting any better. They feel in pain. Why is that so, since the GDP from low point of 4.0% to 5.8% within 1 year?

I believe the major pain is the MYR currency depreciation against major currencies like USD and SGD. USD to MYR has appreciated from RM3.10 in year 2013 to RM4.40 lately, and now retrace a little bit to RM4.20. A whopping jump of 35%! Whereas SGD to MYR has appreciated from RM2.50 in year 2013 to RM3.15 lately, and now retrace to RM3.12. A significant jump of 25% as well. That means whatever imported to the country with these appreciated currencies, will be having price hike of at least 25-35%.

The second pain point is Government Service Tax (GST), 6% GST imposed on all items from April 2015 is also a drastic burden to all citizens. Every 1 dollar you spent, you will have to pay additional 6 cents. That's indirectly make the inflation goes up 6% straight.


There's another indirect impact which is the deterioration of the Government efficiency and business strategy. You can see most developing countries in ASEAN are trying to attract foreign direct investment (FDI) by improving internal infrastructure and procedure. But it seems like Malaysia is running backward. Well, I'm not sure about it but you can see the local well-known businessmen's negative comments and feedback in business magazines. We haven't talk about the Government investment scandal yet. ;(

With the combination of these 3 factors, how can the economy turns better in such a short time even with a good GDP statistics? Imagine if you used to make $1,000 and spent $700 and save $300. Now you will have to spend at least $800-$900 and only can save around $200-300. What can the citizens do? Tighten their belt in order to save more and sustain.

Remember, the salary is the one that won't be increased over such a short time, but inflation & the factors above.
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