MAA - Cried wolf again?

The deal just gave me the impression of owners trying to make a last attempt at gaining profit from share trades. Who's the one releasing news of 70% MAAB shares sold for RM1.2 bil? (Figure out yourself) And the shares went ballistic. But just yesterday it made another application to sell NOT 70%, but 100% of MAAB, at ONLY RM344mil. What a huge difference!! From RM1.7bil to only RM344mil for 100% MAAB. Something seriously wrong there innit?

Another question: How will they use the proceeds from the sales? Do we have confidence in  the management being able to deploy their cash to good use? A wolf will always remain a wolf. A tiger does not change its stripes. Minority shareholders will always be at a loss to these big wolves. 

Moral of the story: These kind of shares (Bad earnings, management who is not bothered about shareholders, rumor-filled) are only good for hit and run. They just cannot be held for long term and cannot be hoped to be able to reward shareholders in the long term. As for MAA, we can't hold for long term, thinking that they will be able to utilize their proceeds efficiently or reward shareholders with some capital repayment or something like that. MAA still has the same boss and its history speaks for itself.

Tay Cher Siang (Pianist) - Simply Breathtaking

I just have to post this after watching Tay Cher Siang on the piano at No Black Tie last Saturday performing Brazilian music with a band (The music of Milton Nascimento and Egberto Gismonti). His piano skills were just breathtaking. It's not only just about his dazzling virtuosity with octaves and heavy chords playing like single running notes at lightning speed, but also his touch and well-thought piano arrangement which were so filled with emotions, melting the hearts of the audience. He is one of the best and most exciting pianists that I've ever heard live and his playing reminds me of the world-famous Michel Camilo, a Latin composer and pianist. I really hope he would make it big in the international stage and am so proud that there is such a talented pianist hailing from Malaysia. Check out his blog here (mostly in Chinese). He was featured in Dali's post as well (I just realized he was the pianist Dali mentioned :P).

Tradewinds Malaysia (RM9.33; Target: RM15): A blip in 1Q2011 results

Tradewinds Malaysia 1Q2011 performance was poorer as compared to the previous quarter. Revenue and earnings dropped by 8.2% q-o-q and 53.5% q-o-q respectively to RM1.46 bil and RM89.9 million respectively. The drop in earnings was mainly attributed to lower production from plantation division (Seasonal factors) and lower earnings from sugar refining division. Nonetheless, as compared to 1Q2010, revenue and net profit actually rose by 12.4% y-o-y and 16.4% y-o-y respectively. 

Despite the higher revenue from sugar division, its operating profit was down. This could be due to the international sugar price which rose to the highest at 65.3 cents/kg in Jan 2011 before dropping to 53.7 cents/kg in April 2011. The following quarter could be better as Malaysian sugar price was hiked recently while at the same time international sugar prices continue to drop. 

EPS for this quarter was at 31 sen while trailing 12-Month EPS was at RM1.67, thus PER remains low at only 5.6x. Net gearing continued to drop from 1.07x in 1Q10 to 0.8x in 1Q11. Owing to the favorable prospects arising from hike in Malaysian sugar prices and declining international sugar prices coupled with CPO prices which remain firm, Tradewinds remains attractive and profits should exceed RM400 mil this year. Plantation division's performance in the following quarters of this year is expected to improve over the current quarter's while its rice division is expected to maintain its performance. Just read an article from TheEdge Weekly which mentioned a target price of RM15 for Tradewinds, in line with what I have in mind as well. 

Nonetheless, due to the current blip in 1Q11 results and the strong run-up in its stock price, we might see some profit taking at this moment. For longer term investors, do take advantage of the current price weakness as this stock remains very undervalued.

All in RM'000