AmEesearch Sdn Bhd has strengthened its "buy" call on Tan Chong Motor Holdings (4405) stock and revised upwards its fair value to RM4.30 from RM3.70 a share after meeting the company's management.
The research house upgraded its valuation of Tan Chong's motor division to 13 times its forecast 2010 earnings from its historical mid-cycle price-earnings of 12 times, noting major structural changes that could elevate Tan Chong's competitive positioning.
AmResearch said it came out of the meeting with Tan Chong's management and identified three developing themes which could be catalysts in lifting its share price.
The themes are its structural regional expansion, wider model mix and plans for property redevelopment.
Tan Chong has said that it intends to become an integrated Asean automotive supply chain manager, that is, turning the company into a borderless manufacturer and one with a higher level of autonomy from its principals.
Succeeding in this goal could see an expansion of its assembly and distribution rights in the region.
Acquisitions are on the cards involving markets such as Indonesia, Cambodia and Laos, after similar moves in Thailand and Vietnam last week.
The move would involve a total investment of RM1 billion over the next four years, it said.
AmResearch projects Tan Chong's strategy of widening its model mix on the Malaysian scene to bring about robust growth in its market share.
At present, Tan Chong is not represented in three major vehicle segments - A, B and D - which account for 61 per cent of total industry volume in the country.
Its management expects earnings to double in 2012 from 2009 levels with the introduction of A and B segment models.
Around RM250 million has been allocated for Phases 2 and 3 capacity expansion at Tan Chong's plant in Serendah, Selangor, over the next two years, which would more than double the annual capacity to between 50,000 and 60,000 vehicles.
At the same time, a property redevelopment theme is unfolding at its Segambut land.
AmResearch said the catalysts are revaluation of its property in Segambut; conversion of the land to commercial real estate; and value enhancement from development of the land.
16 comments:
Thing happen again, Genting and GENM heading different direction !?
I'm target Genting now
Patient is the key while dealing with investment. I keep TChong almost a decade before deciding to let it go at RM1.20, see how much it worth now..... :(
You were in the right track but only to discover later you are just another impatient guy after all else i will be "Laughin All the Way to Bank" by at least double of my investment.
Never never look back let bygone be bygone.
horse
Everday, market got different investment theme. Today Tchong share soaring, apparently is due to upbeat by analyst whom just meet Tchong management and boosted by all so of catalysts that may spur its own fund manager to push share even higher to justify their buy-call and entice more retail player.....
Horse
Tchong lesson may further enhance your believe that never let go any of your longterm holding. Keep them for life, one day any one of them will double ...triple...and just need to wait your time to 'Laughin All the Way to Bank'
Sold off all Axiata at 3.03-3.04; realize one time 3k transaction cost loss
GENTING & GENM are both always running in contrast.
I still wonder what more can GENM do ? beside having small RPTs (<5%) to benefit GENTING. I do hope they give out good dividend in next quarter at least 30sen or more....sitting under a large cash pile also difficult if doing nothing. Maybe at least shares buyback if no where else to go..
Bought Bjtoto at 4.11
Sold off all Bjtoto at 4.15, realize more than a k intraday profit
bought back bjtoto at 4.12
Sold back all Bjtoto at 4.16-4.18; realise more than 2k intraday profit,
together, profit from bjtoto not only manage to setoff loss from Axiata, but manage to record few hundred intraday profit.
Wow lau, market manage to make U-turn, from -Ve to +ve, up more than 5pts!
In summary; adds Dijaya to average down holding cost; sold Protasco; cresbld and Hingyap realize more papaer profit and to reduce stake; Sold off Axiata at loss, but setoff by intraday gain on Bjtoto. Portfolio manage to further reduce stock holding
Core portfolio
Protasco 45.9%
Dijaya 31.3%
Lonbisc 29.4%
Hingyap 27.6%
Crestbld 0.6%
Bought more Dijaya at 90.5-91sen
hng
C payback the TARP bailout to gov, good time to grab some for longterm investment. Temporary may see set back for now due to dilution, longterm in 3 years should be ok... :)
I'm prepare to strike more.
Citigroup, announced significant capital raises in order to repay $20 billion, allowing the banks to exit TARP
Pros
1. Freeing Citi from close regulatory scrutiny and marking the latest step toward recovery for the U.S. financial system.
2. Releasing Citi from strict compensation limits that banks had said were impeding their ability to attract and retain talent
3. Signals a vote of confidence from the government in the ability to stand on its own
Cons
1. Government will sell the 34%stake it holds in Citigroup.
2. Under the fund raising, Citi will sell $20.5 billion in stock and debt to repay the bailout funds. The capital raise will dilute current shareholders by between 20 percent and 25 percent depending on the sale price of the stock and debt.
horse
I'm waiting for more clearer signal from Citi
a. whether Citi opt for private placement or right share and at what price.
b. if through debt/bond and at what cuopon rate and its rating
c. Monitor its upcoming trading volume to assess the exit price from Gov selling and its intensity pressure. The selling of 34% stake should be very soon/before the fund raising completed
by the way, the account openning already in proses.
Selling more Hingayp at 1.18, realize more paper profit
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