Saturday, September 28, 2013

SPACs High Risk, High Reward

Is it advisable to invest in SPACs? SPACs stands for Special-Purpose Acquisition Companies. These companies are actually shell companies with nothing to show. They don't have any track record, any brand name or any asset. 

Basically, SPACs are meant to promote private equity investments, spur corporate transformation, and encourage merger & acquisitions.

 When you invest in SPACs, it means that you are handling over your money to a team of supposed-to-be professionals who will look for good assets to buy and invest. Obviously, what is most important here is the integrity and competency of the team. 

Competency without integrity is worse than integrity without competency. I wouldn't invest in a company that is either the one or the other. The worst is, when there is neither competency or integrity. Therefore, if you are about to invest in SPACs, you must, firstly, make a study of the management team. When you are convinced that the team is skillful and honest, then and only then, you hand over the team your money. Otherwise it is better to avoid them.

One more thing, don't forget that while the team is looking for qualified assets to buy, the company has to pay the team members their salaries. This means outflow of cash without any inflow. 

In America, there are more failures than successes as far as SPACs are concerned.

Presently we have three SPACs listed in Bursa. They are Hisbicus, Cliq, and Sona. More shall be coming. 

If you are risk-adversed, SPACs are not for you. 

Whatever action you take as a result of reading this article is your absolutely responsibility. 

Friday, September 27, 2013

When a bullish article is not to be taken at face value

The moment you read a bullish article about a certain stock,  do not rush in to buy. Not all bullish articles are meant for you to make money. Many are meant to benefit only a limited number of people. You know what I mean?

Bear in mind that big boys are very powerful. They are capable of manipulating the price;  they are also capable of manipulating the news.

If you don't want to be taken for a ride, you have to be careful; you must not act in haste. Many mistakes are made because of haste.

Check the latest quarterly report; check the balance sheet; check the income statement as well as the cash-flow statement. If you see some red flags that are not highlighted in the report, then that report must be read with skepticism.

Never buy a stock without having a good look at its chart. Never buy in a downtrend, and never ever go against the market. It is much stronger than you. 

If you don't listen to me, I can't help you.

Saturday, September 14, 2013

A Glimpse of Heaven on Earth

The Kechara Forest Retreat will be a place like no other, nestled in the deep mountains of Chamang, Bentong, about 1 1/2 hours drive from Kuala Lumpur. This village is being created within the green tropical forest…
The Kechara Forest Retreat welcomes people from all walks of life to visit and practice. Away from the hustle and bustle of the city, it will feature various facilities and buildings designed to serve those who visit…

Thursday, September 12, 2013

Founders of StemLife exit company

Corporate | SEPTEMBER 11, 2013 by Jose Barrock
StemLife logoSingapore listed Cordlife Group Ltd surfaced as a substantial shareholder in StemLife, buying 49.3 million shares or a 19.9% stake in the publicly traded Malaysian stem cell therapy and life- sciences company.
Interestingly enough the announcements to the local bourse indicates that the sellers are the founders off StemLife Sharon Low Su-Shing and Christina Lim Oi Wah.
According to the company’s latest annual report for FY2012 Low has 11.2% in StemLife, while Lim has 11.19% equity interest in the company.
It is not known how much Cordlife Group paid for the controlling block of StemLife, as the only detail offered was that the deal was done on September 3.
However the market seems to be positive on the entry of Cordlife. StemLife was up five sen to 37.5 sen at 3.50pm giving the company a market capitalisation of about RM92.8 million.
It is n not clear if Low the managing director and Lim the executive director will step down after selling out of the company.

StemLife-Founders Christina Lim Oi Wah (left) and Sharon Low Su-Shing
Christina Lim Oi Wah (left) and Sharon Low Su-Shing

Perhaps the writing was already on the wall. In end May this year Low took 12-month sabbatical leave, leaving Lim in charge of the company. This was quite a surprise as Low has been the face of the company since its floatation exercise in October 2006.
It is also noteworthy that StemLife has billionaire businessman Vincent Tan Chee Yioun as a 12.12% shareholder in the company. Other substantial shareholders include Capital Group International Inc with 8.9% and Emerging Markets Growth Fund controlling 5% equity interest in Stemlife.
For its six months ended June this year, StemLife posted a net profit of RM1.5 million from RM8.5 million in revenue. Earnings per share for the six months was 0.62 sen.
StemLife also has a 40% stake in ThaiStemLife Co Ltd.
Cordlife Group-logoAs for Cordlife Group, Bloomberg has the company focusing on cord blood banking services, including the collection, processing, testing preservation and storage of umbilical cord blood at birth.
A check on Cordlife’s annual report for FY2012 however reveals that as at mid-September last year, Cordlife Group Ltd’s largest shareholder was China Stem Cells (East) Co Ltd with 10.47%. Other substantial shareholders included City Challenge Global Ltd controlling with 9.4%, Coop International Ltd with 8.8% and Wells Spring Pte Ltd with 7.22%
For FY2012, Cordlife posted net profits of S$6.9 million from US$28.8 million in revenue.
Cordlife has a market capitalisation in excess of S$300 million.

Sunday, September 01, 2013

MNRB First and Final Dividend of 32% less tax

OTHERS Proposed First and Final Dividend

Proposed First and Final Dividend

We are pleased to announce that the Board of Directors of MNRB Holdings Berhad had agreed to recommend the payment of First and Final Dividend of 32% less 25% income tax for the financial year ended 31 March 2013 to be paid on a date to be announced later, subject to approval by shareholders at the forthcoming 40th Annual General Meeting of the Company
The above announcement was on 27 June 2013. But todate, no dividend has  been declared. Hopefully, it will do so later.