An emerging diversified private investment fund
We added Gold at USD 1388 and AUD 3.05 against RM. We believe the recent election of Australia resulted in a strong government that can improve the sentiment at the moment and strengthen AUD.
If a war is to be on Syria, Gold will go higher. But again, our long term bet in Gold is due to the QEs problem that we hedge for a world worst disaster if any to come.
We don’t see any extreme stuff happen except US strike on Syria. As we believe market start to digest and Obama idea to only limit strike on air.
We don’t forecast politics but we believe KLCI will range bound 1,700 – 1,740. If nothing much events will see more bargain hunting to support a small technical rebound with highly close end of the week expected.
Month ago when worldwide central banks competing devaluing their currency especially started by Japan. We speculate that BNM may follow as suddenly RM becomes too strong that will affect our export. As Malaysia’s manufacturers are not use to hedging as RM is still a semi protected currency.
We suspect BNM take this regional minor crisis and devalue naturally RM by not intervening into its dropping value. But we see won’t be far. Max acceptable USD vs RM level will be around 3.60 and below. First support should be below USD 3.40.
Not just politics, even the business does not talk sense. I do agreed fuel price hike may incur cost in the supply chain. However, crack down on illegals that impact legal and illegal workers is definitely a joke.
Either I read the news as many local developers engage illegal workers. However, the crack down also caused many legal don’t dare to turn out and work.
Firstly, does REDHA suggest no crack down on illegals workers or property sector has exception? Since when things are becoming so complicated.
This is daily jokes that I think Yen can cook may better than our politicians now even REDHA. There will be a day when market force will take back as a decision making factor on price.
In this scenario, is our national interest is more important or property developers’ interest? You can forever transfer cost from supply chain but so do market whether can accept it or not.
A smart watch is nothing new. But the on going trend and its added functionality of latest Samsung new products range further hints the IT industry consolidation is entering into next level.
Why say so? Retail market is almost matured into cloud base software. Hardware is far more one can imagine and maximize to use it. Eventually, retail cloud base applications, hardware like Samsung and the medium which bring things together are the Telcos will probably left behind.
What if one day, the cloud base concept is to flood the corporate world? Resulting in further consolidation of localized technological firms. We see this happened in some large corporations in Malaysia where email service, office applications and share point portals are outsourced to Microsoft.
If a tech firm is not able to finding the niche by itself. We believe it will become survival issues faster than ever. As such, we call for a reduction of holding IT related technological counters which is non cloud and niche segmented.
We have made a decision to sell off our Stemlfe which has a PE of more than 20 times base on recent 2 quarters earnings. We switched to Puncak as to both speculative that Selangor government may takeover. But we believe at least above RM 4.00. If the takeover is not successful, the current EPS and NTA is still undervalued.
We bought in Lippomalls at SGD 0.430, Teledata SGD 0.013, ABC at HKD 3.480, Kawan-WA at RM 0.115 and IGBREIT at RM 1.200.
We sold off Golden Medical at HKD 0.920.
I have been always an advocate of reducing subsidies especially Petrol. Too much wasted resources and cheap fuel cost has caused inaccurate market pricing on services and products.
However, in the same category of fuel cost. Taxes on vehicle should be drastically reduced. As it cost unproductive loan in the system.
We should have a normal petrol price which is pay per you use. But low taxes on vehicle that encourage vibrant auto market.
I suggest not to link this issue to benefit to the poor. As it is a completely wrong idea. The pricing chain will increase after fuel price increased. A few more hundred RM given a year does not help much at all.
On balancing our budget. Isn’t it always a top priority to plan what you can spend rather than revise plans?
32% of par value of RM 1 equal to RM 320. Deduct 25% tax left RM 240. If based on our entrance price of RM 2.80. It has a yield of 9%. If based on the current price of RM 3.50. It has a yield of around 7%.
We still recommend a buy call on MNRB due to its value to ROI investment ratio.
For years that we have been looking for direction about how to steer our economy to a better position. From private sector initiated projects to governmental projects. So far. I personally think we really need a theme before it is too late.
Too much time spent on politics and emotions. Most of the policies and reactions are kick and move. Probably I have gone through a most quiet Merdeka day in my life.
If this to continue, we will reduce our re-investment locally and looking for more focused economy elsewhere.
J&J Investment Co. 