CIMB 4th Quarter profits tripled

CIMB reported increase of profit year on year for 312%.  However yearly profit still lower than previous year.  We are positive on CIMB current share price and continue calling a buy.

We have disposed some Kawan for RHBCap, CIMB, OSK and TuneP

Kawan shares price may goes further. But given the current market sentiment the price is at premium.  Furthermore if USD weaken against RM further.  The sentiment of high exchange gain may fade.  New capacity and sales may still need a year or two to reflect.

We sold some Kawan at RM 3.65 and bought RHBCap at RM 5.45, CIMB at RM 4.30, OSK at RM 1.62 and TunePro at RM 1.24.

Bingo’s Mermaid hit RMB 2.5 billions as a new record

Stephen Chow new movie “Mermaid” taking a hit worldwide especially in China.  As of today the movie break China’s record with RMB 2.5 billions and still growing for the following days to come.  We believe this time will significant contribute earning to Bingo group.  Besides, also will provide a good branding for Bingo for future productions.  The price of Bingo has increased from HKD 0.20 to a high of HKD 0.30 even though Hang Seng crashd from 32,000 to 18,000.  We have a temp target remained at HKD 0.40 to 0.50.  Long term target depends its plan in creative repeating income oriented business.

We buy lightly last week for good valuation companies

We continue to buy but lights on good value companies.  Oil price is temporarily stable after ceiling production limit set.  We believe oil price is capable to further fix above USD 50 if necessary.  Now it will be the time to focus into possible revival of world economy especially US, China, Japan and Europe.  We believe US and China are still strong but Europe and Japan are struggling.  Emerging markets will resume its grow once the road blocks are clear.  However, cautious on end major problems due to global warming and central’s banks debt remained.  Our strategy remained to invest in asset oriented business, commodities oriented and environmental businesses.  With a condition bias to dividend or income oriented companies.

Lack of liquidity globally

When loan at low to negative rate.  However, many equities trading below 5-10 times with a return of equity close to as high as 20%. The only reason to explain is the world actually still growing but diluted.  Especially liquidity may gone to other areas where hoping a U turn when they re-enter equities markets.  Opportunities are everywhere from China to Singapore. US to Europe and even locally Malaysia.

Major Chinese banks are undervalued

After the recent sharp correction, many Chinese banks are undervalued.  Many price earning ratios below 4 times and trading below NTA.  We will start pick up certain banks again. Our preference is ABC, ICBC and CCB.

We bought MBSB below RM 1.40

We like the call off of the potential M&A.  We think the best return for share holder is to apply banking license by itself.  Be it need more time rather than paying premium just for the reason of lower cost of fund.  We bought some below RM 1.40

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