Once again it is like joke of the day when people all eye into the merger and spent so much resources. I never like CIMB as they have been merging too much and too fast. However, understand this may be the political reality in Malaysia. Sometimes we just can’t do much like the Southern Bank case years back.

However, to me is a good news where I value MBSB easily RM 3.00 above. RHBCAP fair value at RM 12.00 above. The call off of the plan will initiate us to buy call on both at current level of RM 2.17 and RM 7.70 level. As of CIMB, I will suggest a switch to RHBCap or MBSB rather than them.

The best way to invest in stock is by its value.  The price of stocks may fluctuate across time. Only by investing into a value will allow your chances to profit more in long run.

There is no need to look for its low or historical price.  Also be prepared to lose some market values before you can learn to profit from it.

Buy stocks that shown values. Pack your golf or gym beg and get some quality times.

We bought Gadang at RM 1.320, Cypark at RM 1.850, Marco at RM 0.155, HHGroup at RM 0.400 and Alaqar REIT at RM 1.380.

We expect more weakness but we will try to be more patient in our bargain hunting activities as lately there are too many values emerged in the market. We will buy slow.

We forecast a rally due to more retail purchases before GST implementation in April 2015 last year. However, out of our expectation crude oil dropped from USD 110 per barrel to today below USD 60 dampened the market.

With low oil prices that lower our taxes income and GDP due to weak export.  Weak Ringgit that hampered BNM to reduce rate to stimulate economy. GST introduction in April will hurt retail sentiment for an expected 6 to 9 months. 

If couple with climate changes impacts and also political issues in our local front.  Personally I see extremism arises in both race and religious will further pressures total local reinvestment and new foreign investment.

As such, we will continue good stocks selection in selected industry.  We will start to cut our weight at local front reinvestment policy.

We think KLCI will hovering around 1600 to 1800 with very much a flat year ahead.  Unless crude oil rebound in short term back to USD 80 to 90 of US, Europe and China economy will grow back to increase our foreign demand and cover the shorts.

Buy

1. Cypark – Target RM 4.00
2. Puncak – Target RM 3.50
3. HHGroup – Target RM 0.60
4. Union Steel (SG) – Target SGD 0.30
5. GCL-Poly (HK) – Target HKD 2.50

Hold

1. Freetch (HK) – Target HKD 2.50
2. Analabs – Target RM 2.50

The current flood that impacts 9 states in Malaysia and may get further worsen when storm approaching by 29th and 30th Dec 2014 according to related department.

Today Air Asia crashed may due to severe weather as well.  So did two more planes in Africa and Taiwan respectively.  We pray for those on board Air Asia Surabaya to Singapore.

Besides we also recorded many severe incidents worldwide.  Base on current efforts of all nations to solve the issue may be not enough to reduce its impacts in short to mid term.

All these giving us a strong believe that climate changed related businesses will grow continuously in the coming years.  We will realign our foot steps to invest more proportion to climate changed related companies.  We are suggesting a 50% switch in new incoming funds.

Utilities, Green businesses, Food related will be our main picks in 2015.  We also advise world nations to spend more effort and time to tackle this known issues.  We can grow but think of the world and the people.

We bought Paramount, Cypark, Puncak, L&G as our top picks continue emerged values.

We added Innity as we believe the game changing online marketing industry may be further grow strongly in 2015.

We also bought OUE HT SG as we continue adding SG listed REITs as yield is overall better than MREITs as of now.

Commodities price correction, choppy currency, uncertain political scenarios both local and overseas.  More important climate change impacts are more obvious.

We think the safest bet next year will be industries in Utilities, Green, Food and Healthcare.

We like Puncak, Cypark, Poly Energy (China), Alaqar (REIT), Gadang, Kawan will be our main buying interest in 2015.

We still maintain our all time top picks like MNRB, Paramount, MBSB, Success and L&G.

Besides we will look into some cloud or Internet related media companies and increase our stakes due to our believe the market is shifting towards this aggressively.

We added Affin at RM 2.90 and ARREIT at RM 0.800.  Amid KLCI rebound as we continue nibbling base on valuation and prospect.

Among a currency that we can invest due to its weakness against RM is AUD.  As of today below RM 2.85 below against 1 AUD is a low that shown value.