For the latest quarter ended 30.9.2011, EPS equals 21.88 sen. This is indeed commendable. It is 95% better than the previous corresponding period, and 71% better than the preceding quarter. Review of performance of the group reads as follows:
Plantation Division Our Plantation Division reported a 95% increase in profit before tax for the first nine month ended 30 September 2011 compared to the same period last year mainly due to:
i) Higher production of CPO & PK by 12% and 7% respectively. ii) Higher average CPO & PK prices by 32% and 78% respectively:
Healthcare Division Healthcare Division registered higher revenue and profit before tax by 16% and 15% respectively due to increase in number of patients being treated at our hospitals by 8% .
Food Division (Discontinued operation) Food Division recorded profit of RM2.0 million due to increse in average prices of livebird by 20%.
Based on the prevailing CPO and PK prices, the outlook for financial year ending 31 December 2011 remains favourable. Barring unforeseen circumstances, the Group is expected to continue to record satisfactory performance in the current financial year.
Going forward, the group will become more and more profitable as more and more of its lands in East Kalimantan mature. Besides that, its healthcare business is also doing well. The group is cash-rich and has the potential to take opportunity to grow as and when an opportunity arises.
For the year ended 31.12.2011, its EPS is likely to exceed 71 sen. Based on EPS of 71 sen, and on the basis of being traded at 10 times earnings, the stock is worth RM7.10 per share.
At RM3.45, the forward PE works out to be 4.86 which is undemanding. This means the stock is not overvalued.
Disclaimer: As a result of this article, whether you buy, sell or hold TDM, you do so at your own risk absolutely.
马 到 功 成. Success is when the horses come. Success goes only to those who dare and act, it seldom goes to the timid. The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.
Friday, November 25, 2011
Thursday, November 24, 2011
Tit for Tat
Son: Father, I am in love with 3 girls who are all in love with me. I want to marry one of them. They are all from Kampong Lovers, the town in the neighborhood.
Father: Sorry son, but I have to tell you this. You can't marry any of them because they are your half-sisters.
The son was greatly annoyed by this sudden turn of event. He went to his mother and told her what his father had said. Upon hearing it, the mother smilingly said, "Don't worry son. You can marry any of them; you are not his son."
Father: Sorry son, but I have to tell you this. You can't marry any of them because they are your half-sisters.
The son was greatly annoyed by this sudden turn of event. He went to his mother and told her what his father had said. Upon hearing it, the mother smilingly said, "Don't worry son. You can marry any of them; you are not his son."
Tuesday, November 22, 2011
Oil palm sector on alert of bud rot disease threat
Monday, November 21, 2011
Oil palm sector on alert of bud rot disease threat
KUALA LUMPUR: Malaysia’s oil palm industry is on alert for the bud rot disease that has killed millions of trees in South America. The disease is estimated to have wiped out some 50,000ha of oil palm estates in South America, said planters from Colombia, the world’s fifth largest oil palm producer in the world.
Although no cure has yet to be found, Malaysian planters should not panic, said Dr Ahmad Kushairi Din, Malaysian Palm Oil Board (MPOB) deputy director-general.
“We’re taking proactive measures from prevention to control, should there be any contamination. Our stringent quarantine controls have always been in place,” he told Business Times on the sidelines of an international seminar held here last Friday.
Malaysia is the world’s second largest palm oil producer and exports from this industry is forecast to hit RM80 billion this year, its second straight record year. The country will soon be sending a team of agronomists to South America to study the disease.
Kushairi, who is also International Society For Oil Palm Breeders president, explained that the bud rot disease is caused by a microbe called phytophthora palmivora. “Based on our initial study carried out more than 10 years ago, we find that the bud rot disease can spread very quickly because this pathogen is able to swim in the water. It thrives in a very humid and cloudy environment,” he said.
MPOB has also signed a research agreement with Cenipalma, the research institute of the Colombian Palm Oil Growers Association.
Colombia, the oil palm hub in South America, has 350,000ha planted with oil palms. It is the fifth largest oil palm country in the world after Indonesia, Malaysia, Thailand and Nigeria.
Jorge Corredor, a Colombian oil palm smallholder attending the seminar, revealed the bud rot disease had wiped out all 3,200ha of his oil palm estates in just two years.
“We tried sanitation, it didn’t work. Even the replanted Dolly Partons we sourced from Malaysia died. Until today, we have not found the cure,” he said.
Malaysia’s oil palms are affectionately called Dolly Partons by planters because the trees are short and produce very big fruit bunches compared to the original palms brought in from West Africa, a hundred years ago. In the last 50 years, our agronomists have been marrying the Dura and Psifera palms (DXP) to get the Dolly Parton hybrids that bear voluptuous fruit bunches.
Corredor said the bud rot disease is not just in Colombia as it has spread to Panama, Suriname, Brazil and Ecuador. "So many of our mills have closed down and many people have lost their jobs. My country and your country is situated along the tropical belt of the globe, we share the same weather. I'm telling you, this bud rot disease is a serious threat."
"I have nothing to gain from talking about what has happened to the oil palm industry in my country. This is something I would not wish upon planters in other countries. This is potentially a global problem," Corredor said. He thinks that the world could face a shortage of cooking oil if the disease finds it way to Southeast Asia.
Oil palm sector on alert of bud rot disease threat
KUALA LUMPUR: Malaysia’s oil palm industry is on alert for the bud rot disease that has killed millions of trees in South America. The disease is estimated to have wiped out some 50,000ha of oil palm estates in South America, said planters from Colombia, the world’s fifth largest oil palm producer in the world.
Although no cure has yet to be found, Malaysian planters should not panic, said Dr Ahmad Kushairi Din, Malaysian Palm Oil Board (MPOB) deputy director-general.
“We’re taking proactive measures from prevention to control, should there be any contamination. Our stringent quarantine controls have always been in place,” he told Business Times on the sidelines of an international seminar held here last Friday.
Malaysia is the world’s second largest palm oil producer and exports from this industry is forecast to hit RM80 billion this year, its second straight record year. The country will soon be sending a team of agronomists to South America to study the disease.
Kushairi, who is also International Society For Oil Palm Breeders president, explained that the bud rot disease is caused by a microbe called phytophthora palmivora. “Based on our initial study carried out more than 10 years ago, we find that the bud rot disease can spread very quickly because this pathogen is able to swim in the water. It thrives in a very humid and cloudy environment,” he said.
MPOB has also signed a research agreement with Cenipalma, the research institute of the Colombian Palm Oil Growers Association.
Colombia, the oil palm hub in South America, has 350,000ha planted with oil palms. It is the fifth largest oil palm country in the world after Indonesia, Malaysia, Thailand and Nigeria.
Jorge Corredor, a Colombian oil palm smallholder attending the seminar, revealed the bud rot disease had wiped out all 3,200ha of his oil palm estates in just two years.
“We tried sanitation, it didn’t work. Even the replanted Dolly Partons we sourced from Malaysia died. Until today, we have not found the cure,” he said.
Malaysia’s oil palms are affectionately called Dolly Partons by planters because the trees are short and produce very big fruit bunches compared to the original palms brought in from West Africa, a hundred years ago. In the last 50 years, our agronomists have been marrying the Dura and Psifera palms (DXP) to get the Dolly Parton hybrids that bear voluptuous fruit bunches.
Corredor said the bud rot disease is not just in Colombia as it has spread to Panama, Suriname, Brazil and Ecuador. "So many of our mills have closed down and many people have lost their jobs. My country and your country is situated along the tropical belt of the globe, we share the same weather. I'm telling you, this bud rot disease is a serious threat."
"I have nothing to gain from talking about what has happened to the oil palm industry in my country. This is something I would not wish upon planters in other countries. This is potentially a global problem," Corredor said. He thinks that the world could face a shortage of cooking oil if the disease finds it way to Southeast Asia.
Thursday, November 17, 2011
Palm oil may rise to RM4,000/ton: Mistry
2011/11/17
Malaysian palm oil may rise to RM4,000 per metric ton by June amid rising demand for the commodity, said Dorab Mistry, director of Godrej International Ltd.
Demand for palm oil and biofuels are “buoyant,” he said in a Bloomberg TV interview in Singapore today.
Palm oil supplies will fall as trees enter a “flat” output cycle, he said. -- Bloomberg
Malaysian palm oil may rise to RM4,000 per metric ton by June amid rising demand for the commodity, said Dorab Mistry, director of Godrej International Ltd.
Demand for palm oil and biofuels are “buoyant,” he said in a Bloomberg TV interview in Singapore today.
Palm oil supplies will fall as trees enter a “flat” output cycle, he said. -- Bloomberg
Tuesday, November 15, 2011
Buy When There's Blood In The Streets
by Daniel Myers, CFA, CFP (Contact Author | Biography)
Baron Rothschild, an 18th century British nobleman and member of the Rothschild banking family, is credited with saying that "The time to buy is when there's blood in the streets."
He should know. Rothschild made a fortune buying in the panic that followed the Battle of Waterloo against Napoleon. But that's not the whole story. The original quote is believed to be "Buy when there's blood in the streets, even if the blood is your own."
This is contrarian investing at its heart - the strongly-held belief that the worse things seem in the market, the better the opportunities are for profit.
Most people only want winners in their portfolios, but as Warren Buffett warned, "You pay a very high price in the stock market for a cheery consensus." In other words, if everyone agrees with your investment decision, then it's probably not a good one.
Going Against the Crowd
Contrarians, as the name implies, try to do the opposite of the crowd. They get excited when an otherwise good company has a sharp, but undeserved drop in share price. They swim against the current, and assume the market is usually wrong at both its extreme lows and highs. The more prices swing, the more misguided they believe the rest of the market to be. (For more on this, read Finding Profit In Troubled Stocks.)
Bad Times Make for Good Buys
Contrarian investors have historically made their best investments during times of market turmoil. In the crash of 1987, the Dow dropped 22% in one day in the U.S. In the 1973-74 bear market, the market lost 45% in about 22 months. The September 11, 2001, attacks also resulted in a market drop. The list goes on and on, but those are times when contrarians found their best investments.
The 1973-74 bear market gave Warren Buffett the opportunity to purchase a stake in the Washington Post Company (NYSE:WPO) - an investment that has subsequently increased by more than 100-times the purchase price - that's before dividends are included. At the time, Buffett said he was buying shares in the company at a deep discount, as evidenced by the fact that the company could have "… sold the (Post's) assets to any one of 10 buyers for not less than $400 million, probably appreciably more." Meanwhile, the Washington Post Company had only an $80 million market cap at the time. (For more on Buffett's strategy, read Think Like Warren Buffett and What Is Warren Buffett's Investing Style?)
After the September 11 terrorist attacks, the world stopped flying for awhile. Suppose that at this time, you had made an investment in Boeing (NYSE:BA), one of the world's largest builders of commercial aircraft. Boeing's stock didn't bottom until about a year after September 11, but from there, it rose more than four-times in value over the next five years. Clearly, although September 11th soured market sentiment about the airline industry for quite some time, those who did their research and were willing to bet that Boeing would survive were well rewarded.
Also during that time, Marty Whitman, manager of the Third Avenue Value Fund, purchased bonds of K-Mart both before and after it filed for bankruptcy protection in 2002. He only paid about 20 cents on the dollar for the bonds. Even though for awhile it looked like the company would shut its doors for good, Whitman was vindicated when the company emerged from bankruptcy and his bonds were exchanged for stock in the new K-Mart. The shares jumped much higher in the years following the reorganization before being taken over by Sears (Nasdaq:SHLD), with a nice profit for Whitman. Thanks to moves like this, the Third Avenue Value Fund has earned a market-beating 14.3% return since Whitman founded the fund in 1990.
Sir John Templeton ran the Templeton Growth Fund from 1954 to 1992, when he sold it. Each $10,000 invested in the fund's Class A shares in 1954 would have grown to $2 million by 1992, with dividends reinvested, or an annualized return of about 14.5%. Templeton pioneered international investing. He was also a serious contrarian investor, buying into countries and companies when, according to his principle, they hit the "point of maximum pessimism." As an example of this strategy, Templeton bought shares of every public European company at the outset of World War II in 1939, including many that were in bankruptcy. He did this with borrowed money to boot. After four years, he sold the shares for a very large profit. (To learn more about Templeton and other great investors, see the Greatest Investors Tutorial.)
Putting It On the Line
But there are risks to contrarian investing. While the most famous contrarian investors put big money on the line, swam against the current of common opinion and came out on top, they also did some serious research to ensure that the crowd was indeed wrong. So, when a stock takes a nosedive, this doesn't prompt a contrarian investor to put in an immediate buy order, but to find out what has driven the stock down, and whether the drop in price is justified.
Conclusion
While each of these successful contrarian investors has his own strategy for valuing potential investments, they all have the one strategy in common - they let the market bring the deals to them, rather than chasing after them.
by Daniel Myers, CFA, CFP (Contact Author | Biography)
Daniel Myers has earned the CFA designation, the CFP certification and has managed money for investors since 1998. Read more about him at his company's website, King Capital Management, LLC.
Baron Rothschild, an 18th century British nobleman and member of the Rothschild banking family, is credited with saying that "The time to buy is when there's blood in the streets."
He should know. Rothschild made a fortune buying in the panic that followed the Battle of Waterloo against Napoleon. But that's not the whole story. The original quote is believed to be "Buy when there's blood in the streets, even if the blood is your own."
This is contrarian investing at its heart - the strongly-held belief that the worse things seem in the market, the better the opportunities are for profit.
Most people only want winners in their portfolios, but as Warren Buffett warned, "You pay a very high price in the stock market for a cheery consensus." In other words, if everyone agrees with your investment decision, then it's probably not a good one.
Going Against the Crowd
Contrarians, as the name implies, try to do the opposite of the crowd. They get excited when an otherwise good company has a sharp, but undeserved drop in share price. They swim against the current, and assume the market is usually wrong at both its extreme lows and highs. The more prices swing, the more misguided they believe the rest of the market to be. (For more on this, read Finding Profit In Troubled Stocks.)
Bad Times Make for Good Buys
Contrarian investors have historically made their best investments during times of market turmoil. In the crash of 1987, the Dow dropped 22% in one day in the U.S. In the 1973-74 bear market, the market lost 45% in about 22 months. The September 11, 2001, attacks also resulted in a market drop. The list goes on and on, but those are times when contrarians found their best investments.
The 1973-74 bear market gave Warren Buffett the opportunity to purchase a stake in the Washington Post Company (NYSE:WPO) - an investment that has subsequently increased by more than 100-times the purchase price - that's before dividends are included. At the time, Buffett said he was buying shares in the company at a deep discount, as evidenced by the fact that the company could have "… sold the (Post's) assets to any one of 10 buyers for not less than $400 million, probably appreciably more." Meanwhile, the Washington Post Company had only an $80 million market cap at the time. (For more on Buffett's strategy, read Think Like Warren Buffett and What Is Warren Buffett's Investing Style?)
After the September 11 terrorist attacks, the world stopped flying for awhile. Suppose that at this time, you had made an investment in Boeing (NYSE:BA), one of the world's largest builders of commercial aircraft. Boeing's stock didn't bottom until about a year after September 11, but from there, it rose more than four-times in value over the next five years. Clearly, although September 11th soured market sentiment about the airline industry for quite some time, those who did their research and were willing to bet that Boeing would survive were well rewarded.
Also during that time, Marty Whitman, manager of the Third Avenue Value Fund, purchased bonds of K-Mart both before and after it filed for bankruptcy protection in 2002. He only paid about 20 cents on the dollar for the bonds. Even though for awhile it looked like the company would shut its doors for good, Whitman was vindicated when the company emerged from bankruptcy and his bonds were exchanged for stock in the new K-Mart. The shares jumped much higher in the years following the reorganization before being taken over by Sears (Nasdaq:SHLD), with a nice profit for Whitman. Thanks to moves like this, the Third Avenue Value Fund has earned a market-beating 14.3% return since Whitman founded the fund in 1990.
Sir John Templeton ran the Templeton Growth Fund from 1954 to 1992, when he sold it. Each $10,000 invested in the fund's Class A shares in 1954 would have grown to $2 million by 1992, with dividends reinvested, or an annualized return of about 14.5%. Templeton pioneered international investing. He was also a serious contrarian investor, buying into countries and companies when, according to his principle, they hit the "point of maximum pessimism." As an example of this strategy, Templeton bought shares of every public European company at the outset of World War II in 1939, including many that were in bankruptcy. He did this with borrowed money to boot. After four years, he sold the shares for a very large profit. (To learn more about Templeton and other great investors, see the Greatest Investors Tutorial.)
Putting It On the Line
But there are risks to contrarian investing. While the most famous contrarian investors put big money on the line, swam against the current of common opinion and came out on top, they also did some serious research to ensure that the crowd was indeed wrong. So, when a stock takes a nosedive, this doesn't prompt a contrarian investor to put in an immediate buy order, but to find out what has driven the stock down, and whether the drop in price is justified.
Conclusion
While each of these successful contrarian investors has his own strategy for valuing potential investments, they all have the one strategy in common - they let the market bring the deals to them, rather than chasing after them.
by Daniel Myers, CFA, CFP (Contact Author | Biography)
Daniel Myers has earned the CFA designation, the CFP certification and has managed money for investors since 1998. Read more about him at his company's website, King Capital Management, LLC.
Monday, November 14, 2011
More Singaporeans crossing over for cheaper medical treatment
Sunday November 13, 2011
SINGAPORE: When Goh Chai Gek wanted to deliver her baby boy, she decided it would be cheaper to head across the Causeway.
The total cost of her caesarean section delivery was about RM8,190, including three nights.
It would typically have come up to about S$5,840 (RM14,333) in a hospital here, meaning she enjoyed savings of about 40%.
“I could also claim the amount from Medisave,” said the 30-year-old accountant.
Lured by savings of up to 50%, growing numbers of Singaporeans and PRs are travelling to Malaysia for medical treatment. It comes after the Singapore Government relaxed rules in March last year to allow Medisave to be used to pay for hospitalisation and day surgery treatment in 12 hospitals there.
Those crossing the Causeway for hospital treatment will soon have more choice, when a S$2bil (RM4.9bil) medical hub a joint project between billionaire Singa-pore investor Peter Lim and the Johor royal family opens in 2015.
Before the liberalisation, Medisave could be used only in Singapore, or for emergency treatment overseas.
Health Management International (HMI) and Parkway Pantai Group are currently the only two healthcare groups here accredited to refer patients to Malaysia.
An HMI spokesman said yesterday that 120 patients had used Medisave overseas for their medical treatments to date.
HMI has two hospitals in Malaysia the Regency Specialist Hospital in Johor Baru and Mahkota Medical Centre in Malacca.
Most of the cases are obstetrics and gynaecology. Cardiology, colorectal surgery, ophthalmology and orthopaedic surgery are other commonly sought treatments. - The Straits Times / Asia News Network
SINGAPORE: When Goh Chai Gek wanted to deliver her baby boy, she decided it would be cheaper to head across the Causeway.
The total cost of her caesarean section delivery was about RM8,190, including three nights.
It would typically have come up to about S$5,840 (RM14,333) in a hospital here, meaning she enjoyed savings of about 40%.
“I could also claim the amount from Medisave,” said the 30-year-old accountant.
Lured by savings of up to 50%, growing numbers of Singaporeans and PRs are travelling to Malaysia for medical treatment. It comes after the Singapore Government relaxed rules in March last year to allow Medisave to be used to pay for hospitalisation and day surgery treatment in 12 hospitals there.
Those crossing the Causeway for hospital treatment will soon have more choice, when a S$2bil (RM4.9bil) medical hub a joint project between billionaire Singa-pore investor Peter Lim and the Johor royal family opens in 2015.
Before the liberalisation, Medisave could be used only in Singapore, or for emergency treatment overseas.
Health Management International (HMI) and Parkway Pantai Group are currently the only two healthcare groups here accredited to refer patients to Malaysia.
An HMI spokesman said yesterday that 120 patients had used Medisave overseas for their medical treatments to date.
HMI has two hospitals in Malaysia the Regency Specialist Hospital in Johor Baru and Mahkota Medical Centre in Malacca.
Most of the cases are obstetrics and gynaecology. Cardiology, colorectal surgery, ophthalmology and orthopaedic surgery are other commonly sought treatments. - The Straits Times / Asia News Network
Wednesday, November 09, 2011
KL-Singapore high-speed rail project on track
By Sharen Kaur and Zuraimi Abdullah
bt@nstp.com.my
2011/11/09
It is believed that up-and-coming rail tycoon Tan Sri Ravindran Menon has teamed up with UEM Group to vie for the project.
Kuala Lumpur: The high-speed rail system linking Kuala Lumpur and Singapore could take shape by next year, with three groups leading the early race to win the multi-billion ringgit job, people familiar with the plan said.
The Land Public Transport Commission (SPAD) is expected to start a feasibility study on the project early next year.
The commission had already completed a pre-feasibility study, SPAD chief development officer Azmi Abdul Aziz told Business Times.
SPAD will undertake a feasibility study next, which should take six to 12 months to complete, Azmi added.
If feasible, the project is estimated to cost as much as RM12 billion, with the interested parties offering either European or Chinese technologies.
It is believed that up-and-coming rail tycoon Tan Sri Ravindran Menon has teamed up with UEM Group to vie for the project.
Ravindran controls Skypark Terminal, which recently received an offer from the government to undertake a RM1.5 billion rail project.
The project is to connect the Keretapi Tanah Melayu Bhd (KTMB) station in Subang Jaya, Selangor, to the Skypark Terminal at the Sultan Abdul Aziz Shah Airport.
Business Times understands that the Ravindran-UEM venture made a presentation to the government early this year, specifically on the more than 300km high speed rail line.
Sources said they planned to lay railway lines parallel to the North-South Expressway from Kuala Lumpur, Seremban and Malacca to Johor Baru, before connecting to Singapore.
Others said to be in the running for the job are China Infraglobe Consortium-Global Rail Sdn Bhd and YTL Corp Bhd.
China Infraglobe-Global Rail consortium last made a submission for the job in 2009.
To date, it has yet to make a revised proposal to the government, a company official said.
YTL group managing director Tan Sri Francis Yeoh Sock Ping, who is in New York, declined to comment when asked if the company had made a fresh submission.
YTL, operator of the KLIA Express, first mooted the idea to build a high-speed rail in the late 1990s and again in 2006.
The project was put on hold in April 2008 due to high cost, which was estimated at RM8 billion.
In the middle of 2009, YTL expressed hope that the government would relook at the proposal.
It said it would build the rail line on the coastline of Peninsular Malaysia, rather than that mooted in an earlier proposal of building on the existing track.
Last year, the government said it would revive the project.
It was highligted as a high impact project in the government's Economic Transformation Programme roadmap in a bid to increase economic activities.
Yesterday, the government reiterated that it may go ahead with the project.
Transport Minister Datuk Seri Kong Cho Ha said it would wait for feedback from its Singaporean counterparts as the track would go into its land.
Germany's Siemens had previously offered its solutions to the project.
It proposed the use of its Velaro trains, which have a top speed of 350kph.
bt@nstp.com.my
2011/11/09
It is believed that up-and-coming rail tycoon Tan Sri Ravindran Menon has teamed up with UEM Group to vie for the project.
Kuala Lumpur: The high-speed rail system linking Kuala Lumpur and Singapore could take shape by next year, with three groups leading the early race to win the multi-billion ringgit job, people familiar with the plan said.
The Land Public Transport Commission (SPAD) is expected to start a feasibility study on the project early next year.
The commission had already completed a pre-feasibility study, SPAD chief development officer Azmi Abdul Aziz told Business Times.
SPAD will undertake a feasibility study next, which should take six to 12 months to complete, Azmi added.
If feasible, the project is estimated to cost as much as RM12 billion, with the interested parties offering either European or Chinese technologies.
It is believed that up-and-coming rail tycoon Tan Sri Ravindran Menon has teamed up with UEM Group to vie for the project.
Ravindran controls Skypark Terminal, which recently received an offer from the government to undertake a RM1.5 billion rail project.
The project is to connect the Keretapi Tanah Melayu Bhd (KTMB) station in Subang Jaya, Selangor, to the Skypark Terminal at the Sultan Abdul Aziz Shah Airport.
Business Times understands that the Ravindran-UEM venture made a presentation to the government early this year, specifically on the more than 300km high speed rail line.
Sources said they planned to lay railway lines parallel to the North-South Expressway from Kuala Lumpur, Seremban and Malacca to Johor Baru, before connecting to Singapore.
Others said to be in the running for the job are China Infraglobe Consortium-Global Rail Sdn Bhd and YTL Corp Bhd.
China Infraglobe-Global Rail consortium last made a submission for the job in 2009.
To date, it has yet to make a revised proposal to the government, a company official said.
YTL group managing director Tan Sri Francis Yeoh Sock Ping, who is in New York, declined to comment when asked if the company had made a fresh submission.
YTL, operator of the KLIA Express, first mooted the idea to build a high-speed rail in the late 1990s and again in 2006.
The project was put on hold in April 2008 due to high cost, which was estimated at RM8 billion.
In the middle of 2009, YTL expressed hope that the government would relook at the proposal.
It said it would build the rail line on the coastline of Peninsular Malaysia, rather than that mooted in an earlier proposal of building on the existing track.
Last year, the government said it would revive the project.
It was highligted as a high impact project in the government's Economic Transformation Programme roadmap in a bid to increase economic activities.
Yesterday, the government reiterated that it may go ahead with the project.
Transport Minister Datuk Seri Kong Cho Ha said it would wait for feedback from its Singaporean counterparts as the track would go into its land.
Germany's Siemens had previously offered its solutions to the project.
It proposed the use of its Velaro trains, which have a top speed of 350kph.
Friday, November 04, 2011
Rising tide of China investments in Malaysia
By Bilqis Bahari
bt@nstp.com.my
2011/11/04
Kuala Lumpur: Cash-rich Chinese are splurging their money on Malaysian assets and equities in recent weeks.
The move comes just after Malaysia witnessed a wave of Japanese companies buying up local assets.
During the past couple of months, Japanese investors bought some RM4.48 billion worth of Malaysian assets.
Among the notable acquisitions from them were the purchase of CI Holdings Bhd's Permanis Sdn Bhd for RM820 million, Motor Trader and Autocar Asean magazines for RM109.7 million, Khazanah Nasional Bhd's 30 per cent stake in Integrated Healthcare Holdings Bhd for RM3.3 billion and HPI Resources Bhd for RM258 million.
Now the new trend seems to be originating from China and to a lesser extent, Taiwan.
"Investors from China accumulated a lot of cash in the last couple of years and they are looking for a place to put their cash to work," said Pong Teng Siew, Jupiter Securities head of research.
Indeed, Malaysia has seen many Chinese investors, be it from mainland China, Hong Kong or Taiwan, aggressively investing in local stocks, properties and projects.
"Some people think that it is because these investors are worried that the booming China market will fall, and that is why they are moving their funds to other markets, including Malaysia," an industry observer said.
Chinese companies invested some RM3.1 billion in recent period. They include investments made by Wenzhou Foreign Trade and Economic Cooperation Bureau in the East Coast Economic Region (ECER)'s special zone in Kuantan, Zhuoda Real Estate Group in an Iskandar Malaysia project, as well as a Chinese firm, which partnered Mah Sing Group Bhd in the Icon Residence Mont' Kiara project, to name a few.
On Bursa Malaysia, Chinese investors purchased shares in several listed companies. They include Hong Kong-based Christian Kwok-Leun Yau Heilesen, who today controls some 24 per cent of GPRO Technologies Bhd.
Heilesen also bought a combined 19.9 per cent shares in DVM with Raymond Yip Wai Man in August this year. However, he sold his stake in less than three weeks.
This month, two Chinese nationals - Xu Sheng and Jiang Chuan Yi - have emerged as substantial shareholders in Envair Holdings Bhd, controlling some 13.5 per cent of the company.
They each bought eight million shares in Envair at between 27.3 sen a share and 35 sen apiece.
In August, Fong Shu Cheong, a Chinese national in Hong Kong, became a subtantial shareholder of Cybertowers Bhd by buying 12.11 million shares, or 12.11 per cent, of the company last Friday.
Analysts said Chinese firms or businessmen investing in Malaysia is not unusual since it is only natural for them to forge links with foreign businesses.
"The primary motivation for them to invest in other countries is to establish linkages with overseas businesses. They could tap into the market by importing or exporting their products or our products," Pong said.
Edmund Tham, head of research at Mercury Securities, said the reason for the Chinese to invest depends on the value of the business or investment.
He added that as long as Malaysian businesses relate to their core business and there is value in the investment, they will come to Malaysia.
"The question of why Malaysia (being a preferred destination) depends on the business opportunity whether it is suitable for their business, if there is high risk for them and if the returns are good.
"They evaluate this on a case-to-case basis. Therefore, they don't just invest only in Malaysia, but other countries as well," Tham added.
With the influx of funds from Japan and China buying into Malaysian assets, properties in Malaysia will appreciate and continue to appreciate.
Investors should pay attention to property counters now.
bt@nstp.com.my
2011/11/04
Kuala Lumpur: Cash-rich Chinese are splurging their money on Malaysian assets and equities in recent weeks.
The move comes just after Malaysia witnessed a wave of Japanese companies buying up local assets.
During the past couple of months, Japanese investors bought some RM4.48 billion worth of Malaysian assets.
Among the notable acquisitions from them were the purchase of CI Holdings Bhd's Permanis Sdn Bhd for RM820 million, Motor Trader and Autocar Asean magazines for RM109.7 million, Khazanah Nasional Bhd's 30 per cent stake in Integrated Healthcare Holdings Bhd for RM3.3 billion and HPI Resources Bhd for RM258 million.
Now the new trend seems to be originating from China and to a lesser extent, Taiwan.
"Investors from China accumulated a lot of cash in the last couple of years and they are looking for a place to put their cash to work," said Pong Teng Siew, Jupiter Securities head of research.
Indeed, Malaysia has seen many Chinese investors, be it from mainland China, Hong Kong or Taiwan, aggressively investing in local stocks, properties and projects.
"Some people think that it is because these investors are worried that the booming China market will fall, and that is why they are moving their funds to other markets, including Malaysia," an industry observer said.
Chinese companies invested some RM3.1 billion in recent period. They include investments made by Wenzhou Foreign Trade and Economic Cooperation Bureau in the East Coast Economic Region (ECER)'s special zone in Kuantan, Zhuoda Real Estate Group in an Iskandar Malaysia project, as well as a Chinese firm, which partnered Mah Sing Group Bhd in the Icon Residence Mont' Kiara project, to name a few.
On Bursa Malaysia, Chinese investors purchased shares in several listed companies. They include Hong Kong-based Christian Kwok-Leun Yau Heilesen, who today controls some 24 per cent of GPRO Technologies Bhd.
Heilesen also bought a combined 19.9 per cent shares in DVM with Raymond Yip Wai Man in August this year. However, he sold his stake in less than three weeks.
This month, two Chinese nationals - Xu Sheng and Jiang Chuan Yi - have emerged as substantial shareholders in Envair Holdings Bhd, controlling some 13.5 per cent of the company.
They each bought eight million shares in Envair at between 27.3 sen a share and 35 sen apiece.
In August, Fong Shu Cheong, a Chinese national in Hong Kong, became a subtantial shareholder of Cybertowers Bhd by buying 12.11 million shares, or 12.11 per cent, of the company last Friday.
Analysts said Chinese firms or businessmen investing in Malaysia is not unusual since it is only natural for them to forge links with foreign businesses.
"The primary motivation for them to invest in other countries is to establish linkages with overseas businesses. They could tap into the market by importing or exporting their products or our products," Pong said.
Edmund Tham, head of research at Mercury Securities, said the reason for the Chinese to invest depends on the value of the business or investment.
He added that as long as Malaysian businesses relate to their core business and there is value in the investment, they will come to Malaysia.
"The question of why Malaysia (being a preferred destination) depends on the business opportunity whether it is suitable for their business, if there is high risk for them and if the returns are good.
"They evaluate this on a case-to-case basis. Therefore, they don't just invest only in Malaysia, but other countries as well," Tham added.
With the influx of funds from Japan and China buying into Malaysian assets, properties in Malaysia will appreciate and continue to appreciate.
Investors should pay attention to property counters now.
Thursday, November 03, 2011
Investors leave Singapore office empty-handed
2011/11/03
SINGAPORE: Retail investors in Singapore trying to salvage their doomed investments from the local MF Global office were left frustrated and empty-handed yesterday after they were told their trading positions were closed and their funds were frozen.
Dozens of worried local investors lined up at the MF Global office throughout the day seeking to recoup their money, but all they received was a form to complete after being told no money would be disbursed until liquidators wound down the bankrupt US brokerage.
"Of course I'm afraid I may not get back anything, that is why I am here," said Andre Chia, a 32-year-old pilot. "I'm waiting for the liquidation, MAS (Monetary Authority of Singapore), maybe I'll end up at the Speakers' Corner," he added, referring to the only place in Singapore where protesters can gather without a permit.
In the wake of the collapse of Lehman Brothers in 2008, hundred of Singaporeans gathered at Speakers' Corner to protest their losses from mini-bonds linked to the failed US bank.
Liquidators from KPMG have assured MF Global customers in Singapore that they are working to ensure all money in client accounts is returned to them.
However, several investors vented their anger that they were closed out of trading positions at a loss, with no option to wait for the market to turn. "I feel uneasy, I don't know how much I will lose. If I have to cut losses, I have to know how much I will lose," said 57-year-old John Wong, who had invested around S$8,000 (RM19,680) with the brokerage.
Around 20 investors went to the office yesterday afternoon, while local media reported that at least 60 people converged on the premises that morning. - Reuters
Dealing with a foreign broker firm you are not familiar with can be disastrous.
BETTER BE SAFE THAN SORRY. Luckily for Malaysians, MF Global has not been in Malaysia.
SINGAPORE: Retail investors in Singapore trying to salvage their doomed investments from the local MF Global office were left frustrated and empty-handed yesterday after they were told their trading positions were closed and their funds were frozen.
Dozens of worried local investors lined up at the MF Global office throughout the day seeking to recoup their money, but all they received was a form to complete after being told no money would be disbursed until liquidators wound down the bankrupt US brokerage.
"Of course I'm afraid I may not get back anything, that is why I am here," said Andre Chia, a 32-year-old pilot. "I'm waiting for the liquidation, MAS (Monetary Authority of Singapore), maybe I'll end up at the Speakers' Corner," he added, referring to the only place in Singapore where protesters can gather without a permit.
In the wake of the collapse of Lehman Brothers in 2008, hundred of Singaporeans gathered at Speakers' Corner to protest their losses from mini-bonds linked to the failed US bank.
Liquidators from KPMG have assured MF Global customers in Singapore that they are working to ensure all money in client accounts is returned to them.
However, several investors vented their anger that they were closed out of trading positions at a loss, with no option to wait for the market to turn. "I feel uneasy, I don't know how much I will lose. If I have to cut losses, I have to know how much I will lose," said 57-year-old John Wong, who had invested around S$8,000 (RM19,680) with the brokerage.
Around 20 investors went to the office yesterday afternoon, while local media reported that at least 60 people converged on the premises that morning. - Reuters
Dealing with a foreign broker firm you are not familiar with can be disastrous.
BETTER BE SAFE THAN SORRY. Luckily for Malaysians, MF Global has not been in Malaysia.
Sunday, October 30, 2011
It's the Management that makes the difference
Do you know why companies have different destiny? While some are able to grow and prosper, others have failed miserably. Logic tells us that it's the management that makes the difference.
The CEO is the most important person in a company. If this person is competent and has integrity, the company is bound to grow. Competency without integrity is disastrous. You may see the money, but it does not go to you. Of what use is cash if you can't get your hands on them.
In the stock market, everything is not what it appears to be. You have to be very careful. Misleading statements, fraud accounting, manipulation, such as "pump and dump" or "short and distort" are common traits. Although the SEC is here to see law and order, it can never do enough to protect the laymen from being cheated. Take care to note the names of those CEOs in failed companies. This will go a long way to save you from getting involved with people who have no integrity. I am not saying that every CEO in failed companies is bad. But it's better to mix with people who succeed rather than those who fail.
Get close to black ink, and you will be black; get close to gems, and you will shine.
You must upgrade yourself all the time just to stay in play. Time and again, you may feel that you have become proficient only to realize later that once again you are at the wrong end of the bargain.
The world is forever changing. You need to stay focus on your job and stay well informed on what is happening locally and abroad as well.
The present flooding in Thailand, the worst in the last 50 years, is causing great havoc to the country. Malaysia needs to be careful. Obviously, climatic change is one of the factors. Malaysia should find out the causes and take preemptive steps to prevent such flooding if possible.
Fire and water have no emotion. They can really punish you when they are the masters at their fury.
The CEO is the most important person in a company. If this person is competent and has integrity, the company is bound to grow. Competency without integrity is disastrous. You may see the money, but it does not go to you. Of what use is cash if you can't get your hands on them.
In the stock market, everything is not what it appears to be. You have to be very careful. Misleading statements, fraud accounting, manipulation, such as "pump and dump" or "short and distort" are common traits. Although the SEC is here to see law and order, it can never do enough to protect the laymen from being cheated. Take care to note the names of those CEOs in failed companies. This will go a long way to save you from getting involved with people who have no integrity. I am not saying that every CEO in failed companies is bad. But it's better to mix with people who succeed rather than those who fail.
Get close to black ink, and you will be black; get close to gems, and you will shine.
You must upgrade yourself all the time just to stay in play. Time and again, you may feel that you have become proficient only to realize later that once again you are at the wrong end of the bargain.
The world is forever changing. You need to stay focus on your job and stay well informed on what is happening locally and abroad as well.
The present flooding in Thailand, the worst in the last 50 years, is causing great havoc to the country. Malaysia needs to be careful. Obviously, climatic change is one of the factors. Malaysia should find out the causes and take preemptive steps to prevent such flooding if possible.
Fire and water have no emotion. They can really punish you when they are the masters at their fury.
Sunday, October 09, 2011
How To Effectively Investigate A Stock
Thanks to the internet, there is an information overload when it comes to investigating stocks. Simply type in a ticker symbol in any search box, and within seconds you have dozens of articles and related links on that particular stock. Properly navigating through the haystack of information and determining how to use it can be daunting and intimidating, and while there are no shortcuts to properly evaluating a stock, investors can eliminate a lot of unnecessary or repetitive effort by knowing how to effectively investigate a company.
TUTORIAL: Investing 101 For Beginner Investors
Basics First: What is a Stock?
As elementary as it sounds, many investors know what a share of stock is, but often ignore what it means. Stock is an equity claim on the business. Specifically, owning stock is defined as having a residual claim on the business. A stock investor's claim on a company is residual by debt holders and preferred stock holders.
Balance Sheet
Because of this residual claim, the very first place investors should go when investigating a stock is the balance sheet. The balance sheet is one of three principal financial statements of any company, with the other two being the income statement and the statement of cash flows. The balance sheet gives a snapshot of the company's financial position at a specific moment in time. As such, it is more important than the income statement. (For more information, see 5 Tips For Reading A Balance Sheet.)
Often, investors first examine the income statement in order to determine profitability. Profits are extremely valuable, but the balance sheet shows you how healthy a company is. A profitable unhealthy company is a disaster that many investors fail to consider. A quality balance sheet protects a company when times get bad. Consider the various recessions in the U.S. in the past 50 years; most of the companies that failed to make it through had a balance sheet problem.
When looking at the balance sheet, you want to examine the indebtedness of a company. Evaluate the debt in relation to total assets and equity value. Consider the quality of the company's assets. How do current assets stack up against current liabilities? How much cash is on the balance sheet in relation to debt? How much goodwill or other intangible assets are on the balance sheet? Under tough operating environments, goodwill and intangibles are usually worth very little for most companies.
Once a balance sheet has been examined, it can be connected with the other financial statements. Look at the interest expense line item on the income statement and compare it to the company's earnings before interest and taxes. Is the company comfortably making its interest payments?
Management
Once you get a handle on the financials, investigate management. An effective way to do this is by reading a company's annual proxy statement (DEF 14A), which can be found on the company's website or at the Securities and Exchange Commission website. A proxy statement will show you insider ownership levels and management pay, two good metrics for evaluating management. (For related reading, see SEC Filings: Forms You Need to Know.)
Investigate Industry
If you are still comfortable with the company, it's time to investigate the industry. One quick way to do this is to compare numbers between competitors. Some great numbers to investigate:
1. Operating Margins
Does one company have significantly higher or lower margins than the others? Is this a long-term occurrence or a one-time benefit?
2. Debt to Equity Levels
Is the industry characterized by high or low levels of debt? How does the company stack up?
3. Capital Expenditures
Found on the cash flow statements. Is the industry capital intensive? If so, this could be a problem during weak environments.
4. Competition
Is there a lot of competition? Coca-Cola only competes with a couple of companies. Teen retailer Abercrombie and Fitch has lots of competition. A great deal of competition can make it difficult for a company to consistently earn profits, as these businesses have to compete on price.
Detective Work
Once you have done all the above, the detailed detective work begins. Now you should go back and read the company's financial releases and get a feel for the how the company is looking at growing and creating value for the business. Examine the company's additional SEC Filing, including 13D filings which show if other major investors are taking stakes in the company.
If the particular company you are looking at has operations in your area, go visit them. Some of the best analysis on a company is not found in documents, but visible through the day to day operations.
Conclusion
In the end, this investigative work will give you your unbiased insight into the company. As a result, you are far more likely to make better investment decisions based on quality data and analysis. (For related reading, also take a look at Blending Technical And Fundamental Analysis.)
by Sham Gad (Contact Author | Biography)
** This article and more are available at Investopedia.com - Your Source for Investing Education **
TUTORIAL: Investing 101 For Beginner Investors
Basics First: What is a Stock?
As elementary as it sounds, many investors know what a share of stock is, but often ignore what it means. Stock is an equity claim on the business. Specifically, owning stock is defined as having a residual claim on the business. A stock investor's claim on a company is residual by debt holders and preferred stock holders.
Balance Sheet
Because of this residual claim, the very first place investors should go when investigating a stock is the balance sheet. The balance sheet is one of three principal financial statements of any company, with the other two being the income statement and the statement of cash flows. The balance sheet gives a snapshot of the company's financial position at a specific moment in time. As such, it is more important than the income statement. (For more information, see 5 Tips For Reading A Balance Sheet.)
Often, investors first examine the income statement in order to determine profitability. Profits are extremely valuable, but the balance sheet shows you how healthy a company is. A profitable unhealthy company is a disaster that many investors fail to consider. A quality balance sheet protects a company when times get bad. Consider the various recessions in the U.S. in the past 50 years; most of the companies that failed to make it through had a balance sheet problem.
When looking at the balance sheet, you want to examine the indebtedness of a company. Evaluate the debt in relation to total assets and equity value. Consider the quality of the company's assets. How do current assets stack up against current liabilities? How much cash is on the balance sheet in relation to debt? How much goodwill or other intangible assets are on the balance sheet? Under tough operating environments, goodwill and intangibles are usually worth very little for most companies.
Once a balance sheet has been examined, it can be connected with the other financial statements. Look at the interest expense line item on the income statement and compare it to the company's earnings before interest and taxes. Is the company comfortably making its interest payments?
Management
Once you get a handle on the financials, investigate management. An effective way to do this is by reading a company's annual proxy statement (DEF 14A), which can be found on the company's website or at the Securities and Exchange Commission website. A proxy statement will show you insider ownership levels and management pay, two good metrics for evaluating management. (For related reading, see SEC Filings: Forms You Need to Know.)
Investigate Industry
If you are still comfortable with the company, it's time to investigate the industry. One quick way to do this is to compare numbers between competitors. Some great numbers to investigate:
1. Operating Margins
Does one company have significantly higher or lower margins than the others? Is this a long-term occurrence or a one-time benefit?
2. Debt to Equity Levels
Is the industry characterized by high or low levels of debt? How does the company stack up?
3. Capital Expenditures
Found on the cash flow statements. Is the industry capital intensive? If so, this could be a problem during weak environments.
4. Competition
Is there a lot of competition? Coca-Cola only competes with a couple of companies. Teen retailer Abercrombie and Fitch has lots of competition. A great deal of competition can make it difficult for a company to consistently earn profits, as these businesses have to compete on price.
Detective Work
Once you have done all the above, the detailed detective work begins. Now you should go back and read the company's financial releases and get a feel for the how the company is looking at growing and creating value for the business. Examine the company's additional SEC Filing, including 13D filings which show if other major investors are taking stakes in the company.
If the particular company you are looking at has operations in your area, go visit them. Some of the best analysis on a company is not found in documents, but visible through the day to day operations.
Conclusion
In the end, this investigative work will give you your unbiased insight into the company. As a result, you are far more likely to make better investment decisions based on quality data and analysis. (For related reading, also take a look at Blending Technical And Fundamental Analysis.)
by Sham Gad (Contact Author | Biography)
** This article and more are available at Investopedia.com - Your Source for Investing Education **
Monday, October 03, 2011
Thumbs up for home-grown RFID system
2011/10/03
THE impending deployment of a radio frequency identification (RFID) tag system by the Royal Malaysian Customs at all its checkpoints nationwide to facilitate trade and security is a potential plus for Malaysia in giving peace of mind to investors.
Prior to the soft launch in Penang last week by its developer Smartag Solutions Sdn Bhd, the RFID-based security and trade facilitation system has been given the thumbs up by local and foreign logistics players that participated in a three-month trial-run, which ended in August.
The project, which is set to be financed by newly-listed Smartag Solutions, is one of 12 initiatives under the government's Economic Transformation Programme.
From Saturday and over the span of two years, the home-grown RFID system will be implemented in stages at more than 200 customs checkpoints and 600 high-value bonded warehouses nationwide.
Some of participants of the project, which essentially allows users to secure their containers (whether by air, land or sea) with RFID seals and track their movements electronically while entering, leaving or moving within the country, were DHL, TNT, Federal Express, Western Digital and Priority Cargo.
For these companies, whose reputation is built on speed, reliability and just-in-time delivery, the introduction of the RFID system is most welcome since it has the potential to increase customs clearance efficiency, along with paperless clearance and processes.
RFID is a generic term for technologies using radio waves to identify people or objects and has been available since the World War Two when the British army used it to recognise, among other things, friendly aircraft.
It is not every day that a logistics giant like TNT Express Worldwide NV comes forward and lends it endorsement to the Malaysian Customs for introducing this project.
The pilot run of the project was a collaboration between the Royal Malaysian Customs, industry users and Smartag, with facilitation by the Performance Management and Delivery Unit.
The company's regional network manager (Asia Road Network), Dinesh Kanapathy, said at the soft launch that his company had accrued a time-reduction savings of at least 50 per cent for customs clearance when participating in the trial run.
Other global names have also endorsed the RFID tag, as it has been proven to work in favour of safe logistics.
Penang investors remember only too well the international embarrassment caused to the country in 2006 by a RM50 million computer chip heist at the Batu Maung Free Commercial Zone, near the Penang International Airport.
The world's biggest chipmaker Intel Corp - whose investment presence in Penang spans close to four decades - said it was a victim of the microchip robbery, which left everyone in the state spooked over the lack of security measures in the movement of high-value goods.
By making available to investors, both local and foreign, the option of a cost-effective resource to save time, reduce labour requirements and afford better visibility of moving goods and services, Malaysia can only improve its position as a preferred site for doing business.
Depending on how successful efforts by Smartag Solutions are in convincing importers, exporters and their suppliers on the value of adopting RFID-based security systems, the field is wide open in Malaysia and elsewhere for other sectors - such as the judiciary and healthcare industry - to adopt this system of profiling, tracking and communicating.
THE impending deployment of a radio frequency identification (RFID) tag system by the Royal Malaysian Customs at all its checkpoints nationwide to facilitate trade and security is a potential plus for Malaysia in giving peace of mind to investors.
Prior to the soft launch in Penang last week by its developer Smartag Solutions Sdn Bhd, the RFID-based security and trade facilitation system has been given the thumbs up by local and foreign logistics players that participated in a three-month trial-run, which ended in August.
The project, which is set to be financed by newly-listed Smartag Solutions, is one of 12 initiatives under the government's Economic Transformation Programme.
From Saturday and over the span of two years, the home-grown RFID system will be implemented in stages at more than 200 customs checkpoints and 600 high-value bonded warehouses nationwide.
Some of participants of the project, which essentially allows users to secure their containers (whether by air, land or sea) with RFID seals and track their movements electronically while entering, leaving or moving within the country, were DHL, TNT, Federal Express, Western Digital and Priority Cargo.
For these companies, whose reputation is built on speed, reliability and just-in-time delivery, the introduction of the RFID system is most welcome since it has the potential to increase customs clearance efficiency, along with paperless clearance and processes.
RFID is a generic term for technologies using radio waves to identify people or objects and has been available since the World War Two when the British army used it to recognise, among other things, friendly aircraft.
It is not every day that a logistics giant like TNT Express Worldwide NV comes forward and lends it endorsement to the Malaysian Customs for introducing this project.
The pilot run of the project was a collaboration between the Royal Malaysian Customs, industry users and Smartag, with facilitation by the Performance Management and Delivery Unit.
The company's regional network manager (Asia Road Network), Dinesh Kanapathy, said at the soft launch that his company had accrued a time-reduction savings of at least 50 per cent for customs clearance when participating in the trial run.
Other global names have also endorsed the RFID tag, as it has been proven to work in favour of safe logistics.
Penang investors remember only too well the international embarrassment caused to the country in 2006 by a RM50 million computer chip heist at the Batu Maung Free Commercial Zone, near the Penang International Airport.
The world's biggest chipmaker Intel Corp - whose investment presence in Penang spans close to four decades - said it was a victim of the microchip robbery, which left everyone in the state spooked over the lack of security measures in the movement of high-value goods.
By making available to investors, both local and foreign, the option of a cost-effective resource to save time, reduce labour requirements and afford better visibility of moving goods and services, Malaysia can only improve its position as a preferred site for doing business.
Depending on how successful efforts by Smartag Solutions are in convincing importers, exporters and their suppliers on the value of adopting RFID-based security systems, the field is wide open in Malaysia and elsewhere for other sectors - such as the judiciary and healthcare industry - to adopt this system of profiling, tracking and communicating.
Friday, September 30, 2011
Thursday, September 29, 2011
New Rules New Confidence
Effective from next year, companies listed in Bursa will have to be more transparent. Because of new rules, they have to reveal more.
In their quarterly reports, they will have to give a detailed analysis of their businesses, and inform investors how the current world scenario will affect the present and future development of their companies.
More revelation means less possibility for the management to cook their books. Corruption, cheating and fraud will also be made more difficult.
If the new rules are effectively implemented, Bursa Malaysia will get a much-needed boost. This means that not only foreigners will like it but local investors will like it as well.
Transparency and integrity are essential traits for any stock exchange to flourish. Stringent rules to curb fraud and misleading statements when introduced without fear or favor will result in Bursa getting more investment, be it local or foreign.
The public love a level-playing field. Bursa will do well to ensure they have one.
In their quarterly reports, they will have to give a detailed analysis of their businesses, and inform investors how the current world scenario will affect the present and future development of their companies.
More revelation means less possibility for the management to cook their books. Corruption, cheating and fraud will also be made more difficult.
If the new rules are effectively implemented, Bursa Malaysia will get a much-needed boost. This means that not only foreigners will like it but local investors will like it as well.
Transparency and integrity are essential traits for any stock exchange to flourish. Stringent rules to curb fraud and misleading statements when introduced without fear or favor will result in Bursa getting more investment, be it local or foreign.
The public love a level-playing field. Bursa will do well to ensure they have one.
Tuesday, September 27, 2011
Smartag Potential of a Ten-Bagger
Mention any ACE counter, and you'll probably get a repulsive response. This is to be expected because most if not all, the ACE counters at Bursa have been performing poorly even before the recent downturn. Nonetheless, there is one stock in this category that has caught my fancy. It's Smartag.
The company has just successfully completed its pilot trial with the Royal Malaysian Customs. The article appended below is a must-read if you believe that RFID is the right technology of the present and the future:
Smartag Solutions and Customs completed successful pilot trial
- -
Security and Trade Facilitation using Radio Frequency Identification (“RFID”) deployed in Royal Malaysian Customs’ Checkpoints nationwide
Pilot commercial trial was successfully conducted from 1 June till 31 August 2011, achieve cost saving to the industry, and increase efficiency of Customs process by 9 times.
Pulau Pinang, Malaysia: 26 September 2011 – Total RFID solutions provider Smartag Solutions Berhad (“Smartag”, the “Group”, “智能电子标签解决方案有限公司”) together with Royal Malaysian Customs (Jabatan Kastam Diraja Malaysia or “JKDM” or “Customs”) announced the successful completion of the trial run of the RFID-based Security and Trade Facilitation System at Royal Malaysian Customs Checkpoints in the country.
Speaking at a press conference during the soft launch of the Security and Trade Facilitation System (or the “System”) at the Second Air Cargo Complex Penang, Smartag announced that JKDM jointly with Smartag have successfully completed the trial run of the Security and Trade Facilitation System and have obtained positive results and feedback from the industry users.
Under the trial, the users will be able to use the RFID seal to secure their containers when entering, leaving, and moving within the country. With the usage of the System, the users will be able to automatically identify the containers’ movement electronically via the RFID seal to the RFID readers that are set up by Smartag at the various Customs checkpoints across the country.
During the trial run, participants were able to achieve 50% reduction on time taken for customs clearance, and have obtained cost savings from the usage of the system. During the trial run, JKDM is able to increase its efficiency by 9 times as compared to using the manual process. At the same time, the system deployed is able to solve “hanging” K8 forms.
According to the Chairman of the Air Freight Association of Malaysia, Mr. Walter Culas “The industry welcomes the usage of the system as we value speed, efficiency, and time. The system demonstrated its potential to increase customs clearance's efficiency, and paperless clearance and processes. The industry is fully supportive of the project, and the nationwide implementation."
“Based on our internal cost and benefit analysis has shown that the trial demonstrated that TNT will be able to have at least 50% reduction of time taken for customs clearance and all these benefits will create multiplier effect to the economy in the country", according to Mr. Dinesh K. the Regional Network Manager Asia Road Network for TNT Express Worldwide N. V.
“PEMANDU is pleased that the Security and Trade RFID Facilitation System will be used commercially at Royal Malaysia Customs checkpoints throughout the country. This is a clear indication that the ETP is being implemented, since its launch in October 2010,” said Dr. Fadhlullah Suhaimi Abdul Malek, Director Communications, Content and Infrastructure NKEA and Business Services NKEA.
This project was one of the 12 initiatives announced by YAB Dato’ Sri Najib Tun Razak at the fifth Economic Transformation Programme Update in April. Amongst other objectives, the implementation of the project is targeted at improving the efficiency of container clearance using paperless RFID approach, enabling automatic detection of compromised or tampered containers, and facilitating faster and more transparent trade.
About Smartag Solutions Berhad (ACE: 0169)
Smartag Solutions Berhad (Smartag) is a track and trace solution provider that utilizes Radio Frequency Identification (RFID) and other wireless technologies to enable users to have visibility, transparency and security. For more information on Smartag, go to www.smartag.my
Smartag was lasted traded at 26 sen per share. At this price, the stock is an excellent bet. I have this intuitive feel that this stock has the potential to be a ten-bagger over time.
As usual, please remember, that whatever action you take, you do so at your own risk absolutely.
The company has just successfully completed its pilot trial with the Royal Malaysian Customs. The article appended below is a must-read if you believe that RFID is the right technology of the present and the future:
Smartag Solutions and Customs completed successful pilot trial
- -
Security and Trade Facilitation using Radio Frequency Identification (“RFID”) deployed in Royal Malaysian Customs’ Checkpoints nationwide
Pilot commercial trial was successfully conducted from 1 June till 31 August 2011, achieve cost saving to the industry, and increase efficiency of Customs process by 9 times.
Pulau Pinang, Malaysia: 26 September 2011 – Total RFID solutions provider Smartag Solutions Berhad (“Smartag”, the “Group”, “智能电子标签解决方案有限公司”) together with Royal Malaysian Customs (Jabatan Kastam Diraja Malaysia or “JKDM” or “Customs”) announced the successful completion of the trial run of the RFID-based Security and Trade Facilitation System at Royal Malaysian Customs Checkpoints in the country.
Speaking at a press conference during the soft launch of the Security and Trade Facilitation System (or the “System”) at the Second Air Cargo Complex Penang, Smartag announced that JKDM jointly with Smartag have successfully completed the trial run of the Security and Trade Facilitation System and have obtained positive results and feedback from the industry users.
Under the trial, the users will be able to use the RFID seal to secure their containers when entering, leaving, and moving within the country. With the usage of the System, the users will be able to automatically identify the containers’ movement electronically via the RFID seal to the RFID readers that are set up by Smartag at the various Customs checkpoints across the country.
During the trial run, participants were able to achieve 50% reduction on time taken for customs clearance, and have obtained cost savings from the usage of the system. During the trial run, JKDM is able to increase its efficiency by 9 times as compared to using the manual process. At the same time, the system deployed is able to solve “hanging” K8 forms.
According to the Chairman of the Air Freight Association of Malaysia, Mr. Walter Culas “The industry welcomes the usage of the system as we value speed, efficiency, and time. The system demonstrated its potential to increase customs clearance's efficiency, and paperless clearance and processes. The industry is fully supportive of the project, and the nationwide implementation."
“Based on our internal cost and benefit analysis has shown that the trial demonstrated that TNT will be able to have at least 50% reduction of time taken for customs clearance and all these benefits will create multiplier effect to the economy in the country", according to Mr. Dinesh K. the Regional Network Manager Asia Road Network for TNT Express Worldwide N. V.
“PEMANDU is pleased that the Security and Trade RFID Facilitation System will be used commercially at Royal Malaysia Customs checkpoints throughout the country. This is a clear indication that the ETP is being implemented, since its launch in October 2010,” said Dr. Fadhlullah Suhaimi Abdul Malek, Director Communications, Content and Infrastructure NKEA and Business Services NKEA.
This project was one of the 12 initiatives announced by YAB Dato’ Sri Najib Tun Razak at the fifth Economic Transformation Programme Update in April. Amongst other objectives, the implementation of the project is targeted at improving the efficiency of container clearance using paperless RFID approach, enabling automatic detection of compromised or tampered containers, and facilitating faster and more transparent trade.
About Smartag Solutions Berhad (ACE: 0169)
Smartag Solutions Berhad (Smartag) is a track and trace solution provider that utilizes Radio Frequency Identification (RFID) and other wireless technologies to enable users to have visibility, transparency and security. For more information on Smartag, go to www.smartag.my
Smartag was lasted traded at 26 sen per share. At this price, the stock is an excellent bet. I have this intuitive feel that this stock has the potential to be a ten-bagger over time.
As usual, please remember, that whatever action you take, you do so at your own risk absolutely.
Friday, September 23, 2011
Gold, silver and other commodities tumbled
The Associated Press, On Thursday September 22, 2011, 4:37 pm EDT
NEW YORK (AP) -- Gold, silver and other commodities tumbled amid a global sell-off in financial markets.
Gold fell $66.40, or 3.7 percent, to finish at $1,741.70 an ounce on Thursday. Silver, a precious metal that has wider demand for industrial production, plummeted $3.89, or 9.6 percent, to $36.58.
Analysts said that much of the selling was driven by margin calls for hedge funds and other big investors. "We're seeing hedge funds that have to raise cash, and to do that they have to sell what has been working for them so far this year," said Ryan Detrick, senior technical strategist at Schaffer's Investment Research.
Analysts also said that silver had a harder fall because about half of its demand comes from industrial uses. "If the economy contracts at all, there's going to be a lot of excess silver that's sitting in the supply chain," said Phil Streible, senior market strategist at MF Global.
Gold is up about 22 percent for the year. Silver is 16 percent higher than at the start of the year.
Copper, a metal that closely tracks the economic cycle, fell 27.6 cents, or 7.3 percent, to $3.4885. It is down 23 percent for the year.
Oil, wheat and other raw materials fell significantly because of increased fears that a recession would cut demand. Benchmark crude fell $5.41, or 6.3 percent, to $80.51. It was the biggest drop for oil since Aug. 8, when it fell 6.4 percent after Standard and Poor's downgraded the credit rating of the U.S. Oil has dropped 29 percent since April as global growth has slowed.
Wheat contracts fell 33 cents, or 5 percent, to $6.3375 a bushel. Corn lost 35.75 cents, or 5.2 percent, to end at $6.50. Sugar dropped 1.1 cents, or 4.3 percent, to 24.81 cents. And soybeans fell 37.5 cents, or 2.8 percent, to finish at $12.83.
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NEW YORK (AP) -- Gold, silver and other commodities tumbled amid a global sell-off in financial markets.
Gold fell $66.40, or 3.7 percent, to finish at $1,741.70 an ounce on Thursday. Silver, a precious metal that has wider demand for industrial production, plummeted $3.89, or 9.6 percent, to $36.58.
Analysts said that much of the selling was driven by margin calls for hedge funds and other big investors. "We're seeing hedge funds that have to raise cash, and to do that they have to sell what has been working for them so far this year," said Ryan Detrick, senior technical strategist at Schaffer's Investment Research.
Analysts also said that silver had a harder fall because about half of its demand comes from industrial uses. "If the economy contracts at all, there's going to be a lot of excess silver that's sitting in the supply chain," said Phil Streible, senior market strategist at MF Global.
Gold is up about 22 percent for the year. Silver is 16 percent higher than at the start of the year.
Copper, a metal that closely tracks the economic cycle, fell 27.6 cents, or 7.3 percent, to $3.4885. It is down 23 percent for the year.
Oil, wheat and other raw materials fell significantly because of increased fears that a recession would cut demand. Benchmark crude fell $5.41, or 6.3 percent, to $80.51. It was the biggest drop for oil since Aug. 8, when it fell 6.4 percent after Standard and Poor's downgraded the credit rating of the U.S. Oil has dropped 29 percent since April as global growth has slowed.
Wheat contracts fell 33 cents, or 5 percent, to $6.3375 a bushel. Corn lost 35.75 cents, or 5.2 percent, to end at $6.50. Sugar dropped 1.1 cents, or 4.3 percent, to 24.81 cents. And soybeans fell 37.5 cents, or 2.8 percent, to finish at $12.83.
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Saturday, September 10, 2011
The Trading Doctor - Master Yourself Master the Markets
We come nearest to the great when we are in great humility... Rabindranath Tagore
Traders and investors alike—we are all guilty.
We have all committed the cardinal sin of exhibiting arrogance towards the markets. We must never ever think that we know more than the markets or that we can predict or that the markets care what we think. The markets do not even know who we are—let alone what we think.
If we approach the markets with pride, we will be punished swiftly and without compassion. The markets have no compassion. They want our dramas, our overconfidence, our rat-brained thinking and our money. They will gladly take our needs to suffer, be accepted, be loved, be hated or be punished--- and fulfill them without mercy and with often brutal consequences. The result is a shattered emotional and financial landscape of wealth distribution where the few take from the many. Read more.
Traders and investors alike—we are all guilty.
We have all committed the cardinal sin of exhibiting arrogance towards the markets. We must never ever think that we know more than the markets or that we can predict or that the markets care what we think. The markets do not even know who we are—let alone what we think.
If we approach the markets with pride, we will be punished swiftly and without compassion. The markets have no compassion. They want our dramas, our overconfidence, our rat-brained thinking and our money. They will gladly take our needs to suffer, be accepted, be loved, be hated or be punished--- and fulfill them without mercy and with often brutal consequences. The result is a shattered emotional and financial landscape of wealth distribution where the few take from the many. Read more.
Thursday, September 08, 2011
Tuesday, September 06, 2011
Current estimated 1-to-16 ratio will narrow
M'sia's Iskandar plan may aid S'pore housing market 12 AUGUST 2011 , BY CHANNEL NEWS ASIA
Malaysia's ambitious Iskandar development in southern Johor may have a spin-off effect that would eventually aid Singapore's crowded housing market.
It may even help cool prices, as foreign investment meets increased demand for services and homes.
A plan for seamless connectivity from Johor Baru, Malaysia, to Woodlands in Singapore by 2018, is an attractive allure for investors.
Funds are pouring in, in the hope the development will yield economic benefit.
Singapore has invested some US$153 million (RM 463 million) into the services, education and health sector of the Iskandar Malaysia development, and analysts say further down the line, this will have a positive impact on the Singapore economy.
CIMB Research economist Song Seng Wun said: "If we do have at our doorstep an increased pool of qualified knowledge based labour force, we may be able to tap on that pool, bring them to Singapore and add to Singapore's productivity growth prospect, going forward.
"So if those two investments in those two areas were to work out over the near term, I think it could lead to more significant investment from the Singapore side.
"So I think while the outlook is positive, there are still perhaps many hurdles along the way before we can say we are going to get a significant upgrade with regard to property being moved to a higher plain in Johor.
"That could mean the pressure on property in Singapore could be alleviated because there is certainly now a much more viable option in Johor as a result of the improved communication, logistic network, the whole landscape as an alternative for Singaporeans to base themselves in Johor either for home or for business."
Singapore has already implemented measures to cool booming property prices, and the government may get some help in calming the market, now that the Iskandar project is open for investment.
Credit Suisse analyst Tan Ting Min said Malaysia will benefit from stronger investments from Singapore while Singapore could operate out of Iskandar, which has good infrastructure, and relatively cheaper land and labour.
"Hence, we expect the land price arbitrage to narrow from the current estimated 1-to-16 ratio.
"How quickly this land price arbitrage narrows depends very much on how quickly Singaporeans adopt the idea of moving their manufacturing bases to Johor," Tan added.
"I think we are realistically talking about something that is still in the works, perhaps a decade or more before we can really talk about Johor as a real hinterland," Mr Song said.
KPMG corporate finance partner Vishal Sharma said: "I think in terms of the land price arbitrage I expect you would see the Iskandar land prices going up.
"I don't particularly envisage Singapore land prices... coming down so the arbitrage will narrow but I don't think that it is ever going to go away. But yes, I expect that the arbitrage is going to narrow."
Malaysia's ambitious Iskandar development in southern Johor may have a spin-off effect that would eventually aid Singapore's crowded housing market.
It may even help cool prices, as foreign investment meets increased demand for services and homes.
A plan for seamless connectivity from Johor Baru, Malaysia, to Woodlands in Singapore by 2018, is an attractive allure for investors.
Funds are pouring in, in the hope the development will yield economic benefit.
Singapore has invested some US$153 million (RM 463 million) into the services, education and health sector of the Iskandar Malaysia development, and analysts say further down the line, this will have a positive impact on the Singapore economy.
CIMB Research economist Song Seng Wun said: "If we do have at our doorstep an increased pool of qualified knowledge based labour force, we may be able to tap on that pool, bring them to Singapore and add to Singapore's productivity growth prospect, going forward.
"So if those two investments in those two areas were to work out over the near term, I think it could lead to more significant investment from the Singapore side.
"So I think while the outlook is positive, there are still perhaps many hurdles along the way before we can say we are going to get a significant upgrade with regard to property being moved to a higher plain in Johor.
"That could mean the pressure on property in Singapore could be alleviated because there is certainly now a much more viable option in Johor as a result of the improved communication, logistic network, the whole landscape as an alternative for Singaporeans to base themselves in Johor either for home or for business."
Singapore has already implemented measures to cool booming property prices, and the government may get some help in calming the market, now that the Iskandar project is open for investment.
Credit Suisse analyst Tan Ting Min said Malaysia will benefit from stronger investments from Singapore while Singapore could operate out of Iskandar, which has good infrastructure, and relatively cheaper land and labour.
"Hence, we expect the land price arbitrage to narrow from the current estimated 1-to-16 ratio.
"How quickly this land price arbitrage narrows depends very much on how quickly Singaporeans adopt the idea of moving their manufacturing bases to Johor," Tan added.
"I think we are realistically talking about something that is still in the works, perhaps a decade or more before we can really talk about Johor as a real hinterland," Mr Song said.
KPMG corporate finance partner Vishal Sharma said: "I think in terms of the land price arbitrage I expect you would see the Iskandar land prices going up.
"I don't particularly envisage Singapore land prices... coming down so the arbitrage will narrow but I don't think that it is ever going to go away. But yes, I expect that the arbitrage is going to narrow."
Thursday, September 01, 2011
Why only palm oil?
By Zaidi Isham IsmailPublished: 2011/08/31
THE next time you go to the shopping mart to buy a food item, take a look at the ingredients label.
Chances are it will say the generic term vegetable oil rather than soyabean, rapeseed or palm oil.
Labelling of vegetable oils in the US, Europe and Malaysia has been accepted as the industry norm due to health reasons.
However in other parts of the world, such as Australia and New Zealand, the vegetable oils labelling is not carried as there are no laws requiring food manufacturers to do so.
Since 2009 however, some of Australia's lawmakers have been taking steps to change all that. They want to ask food manfucturers to specify the vegetable oil content, especially palm oil.
This has riled up Malaysia, which sees the move as unfair and discriminatory and can be seen as a non-tariff barrier on palm oil.
Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said it is okay to label palm oil on food products but Australia must compel other vegetable oils to do the same.
The playing field must be fair.
"Why just palm oil? What about the other oils? if you just single out palm oil, people will be asking, what's wrong with this product? We want to put things right from the start. Palm oil poses no danger to health at all."
Isn't it good to label palm oil? The oil is already known for its health benefits. So what is there to fear?
No problem, if the labelling is based on health grounds.
But Malaysia sees the whole labelling issue as a front by the non-governmental organisations to weed out which food manufacturers use palm oil and which do not.
Once it is able to identify the company which uses palm oil, it will launch an attack on the food company to stop its imports, like what they did to Cadbury and Kit Kat.
Their campaigns were so intense that both companies have stopped using palm oil.
NGOs will also link palm oil to forest degradation and the destruction of orang utan habitats.
It is because of this, Dompok led a 10-day trade mission last July to woo Australian parliamentarians not to support the initiative.
The Australian Parliament is due to convene this September to debate the "The Truth in Labelling - Palm Oil Bill", passed last month by the senate and is now on its way to the house of representatives.
The Bill is spearheaded by the independent senator Nick Xenophon and has received strong support from the Greens, the World Wildlife Fund, Zoos Victoria and Greenpeace as well as crucial backing in the senate from the coalition.
Dompok said the Malaysian Government will continue to negotiate with Australia's lawmakers by sending envoys in the coming months to talk them out of it.
Dompok said the Bill threatens the livelihood of 570,000 smallholders in plantations and a further 290,000 in downstream industries.
Out of the four million hectares of oil palm estates in Malaysia, 40 per cent is handled by smallholders.
"The industry has helped a lot of our people to come out of poverty. We have almost reached the point where we can't go much further with palm oil plantations," said Dompok.
He said Malaysia, which has national parks and world heritage sites, is very conscious of its need to preserve its own forests, which cover 55.7 per cent of its total area, well above the 50 per cent it guaranteed to retain at the 1992 Rio de Janeiro Earth Summit.
Besides arguments by NGOs that it destroys the habitat of Malaysia's 11,000 orangutans are baseless as the primate can only be found in Southeast Sabah and Southern Sarawak, which has been gazetted as forest sanctuary and are far from oil palm estates.
There are no orang utans in Peninsular Malaysia.
Malaysia's land used for agriculture, including for palm oil, is governed by strict laws and must be registered and licensed by the Malaysian Palm Oil Board.
"The move to label and and penalise palm oil has the potential to reverberate globally," said Dompok.
He said the labelling will also be cumbersome to Australia's food makers which can cost up to A$60,000 (RM186,000) just to label palm oil on a single food item.
Dompok said the government is deeply disappointed that the Liberal, National and Greens parties and Senator Xenophon have chosen to put politics ahead of the mutually advantageous relationship between Malaysia and Australia.
"This legislation undermines the spirit of our co-operation, especially now when our two countries have forged an asylum seeker deal."
All is not lost for Malaysia however. Should the Bill be passed, Malaysia can take up the battle at the World Trade Organisation where Malaysia can present its case against Australia's discriminatory move on palm oil.
Malaysian Palm Oil Council chief executive officer Tan Sri Dr Yusof Basiron said Malaysia has to fight all the way as NGOs are using Australia and New Zealand as their testing ground to see whether the Bill can be passed.
"Should it be passed, the NGOs know that if they can do it in Australia, it can also be done in the US and Europe," said Yusof.
THE next time you go to the shopping mart to buy a food item, take a look at the ingredients label.
Chances are it will say the generic term vegetable oil rather than soyabean, rapeseed or palm oil.
Labelling of vegetable oils in the US, Europe and Malaysia has been accepted as the industry norm due to health reasons.
However in other parts of the world, such as Australia and New Zealand, the vegetable oils labelling is not carried as there are no laws requiring food manufacturers to do so.
Since 2009 however, some of Australia's lawmakers have been taking steps to change all that. They want to ask food manfucturers to specify the vegetable oil content, especially palm oil.
This has riled up Malaysia, which sees the move as unfair and discriminatory and can be seen as a non-tariff barrier on palm oil.
Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said it is okay to label palm oil on food products but Australia must compel other vegetable oils to do the same.
The playing field must be fair.
"Why just palm oil? What about the other oils? if you just single out palm oil, people will be asking, what's wrong with this product? We want to put things right from the start. Palm oil poses no danger to health at all."
Isn't it good to label palm oil? The oil is already known for its health benefits. So what is there to fear?
No problem, if the labelling is based on health grounds.
But Malaysia sees the whole labelling issue as a front by the non-governmental organisations to weed out which food manufacturers use palm oil and which do not.
Once it is able to identify the company which uses palm oil, it will launch an attack on the food company to stop its imports, like what they did to Cadbury and Kit Kat.
Their campaigns were so intense that both companies have stopped using palm oil.
NGOs will also link palm oil to forest degradation and the destruction of orang utan habitats.
It is because of this, Dompok led a 10-day trade mission last July to woo Australian parliamentarians not to support the initiative.
The Australian Parliament is due to convene this September to debate the "The Truth in Labelling - Palm Oil Bill", passed last month by the senate and is now on its way to the house of representatives.
The Bill is spearheaded by the independent senator Nick Xenophon and has received strong support from the Greens, the World Wildlife Fund, Zoos Victoria and Greenpeace as well as crucial backing in the senate from the coalition.
Dompok said the Malaysian Government will continue to negotiate with Australia's lawmakers by sending envoys in the coming months to talk them out of it.
Dompok said the Bill threatens the livelihood of 570,000 smallholders in plantations and a further 290,000 in downstream industries.
Out of the four million hectares of oil palm estates in Malaysia, 40 per cent is handled by smallholders.
"The industry has helped a lot of our people to come out of poverty. We have almost reached the point where we can't go much further with palm oil plantations," said Dompok.
He said Malaysia, which has national parks and world heritage sites, is very conscious of its need to preserve its own forests, which cover 55.7 per cent of its total area, well above the 50 per cent it guaranteed to retain at the 1992 Rio de Janeiro Earth Summit.
Besides arguments by NGOs that it destroys the habitat of Malaysia's 11,000 orangutans are baseless as the primate can only be found in Southeast Sabah and Southern Sarawak, which has been gazetted as forest sanctuary and are far from oil palm estates.
There are no orang utans in Peninsular Malaysia.
Malaysia's land used for agriculture, including for palm oil, is governed by strict laws and must be registered and licensed by the Malaysian Palm Oil Board.
"The move to label and and penalise palm oil has the potential to reverberate globally," said Dompok.
He said the labelling will also be cumbersome to Australia's food makers which can cost up to A$60,000 (RM186,000) just to label palm oil on a single food item.
Dompok said the government is deeply disappointed that the Liberal, National and Greens parties and Senator Xenophon have chosen to put politics ahead of the mutually advantageous relationship between Malaysia and Australia.
"This legislation undermines the spirit of our co-operation, especially now when our two countries have forged an asylum seeker deal."
All is not lost for Malaysia however. Should the Bill be passed, Malaysia can take up the battle at the World Trade Organisation where Malaysia can present its case against Australia's discriminatory move on palm oil.
Malaysian Palm Oil Council chief executive officer Tan Sri Dr Yusof Basiron said Malaysia has to fight all the way as NGOs are using Australia and New Zealand as their testing ground to see whether the Bill can be passed.
"Should it be passed, the NGOs know that if they can do it in Australia, it can also be done in the US and Europe," said Yusof.
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