BBPlas

Not keen on this one.
If I have to choose in this sector, my blind pick would be SLP.

hehe no wonder it dropped like 5% today.

HAPSENG mana? Or not qualified?

The more the merrier

KSL also good this year

This post has been edited by Le Don: Nov 17 2014, 03:52 PM


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DIGI

Ada apa dengan yellow man

thong guan looks like kena goreng ni.... any outlook on this?

Scientex major profit comes from properties. Daibochi similar business track recorded a drop in quarter-quarter prodit

BPlastic which slightly related to TGUAN profit down this quarter.

any clue?

Daibochi PE 19 times, DY 3% on 55% payout ratio
Thong Guna PE 7 times, DY 4% on 30% payout ratio
BP Plastics' fundamentals the worst among the industry peers, growth erratic (sometimes up, sometimes down)

Only Digi from my recent veggie list doing well today

Oil price still going down, may be bad for Msia economy since we are the biggest exporter in Asia. Shipping companies, airlines and plastic companies could profit from this trend

Anyone looking at CPO price? Demand could go up because of B7 biodiesel program. If price rebounds, can buy some plantation stocks later.

Btw IFCA graph also looks nice too this year

This post has been edited by Le Don: Nov 18 2014, 11:30 PM


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It's not that straight forward for airlines or rather AirAsia.

For one, they hedge (BET) on stuff like jet fuel and forex. (suggest you read thru their profit reports).
The USD hedge is more important because the bulk of Airasia current debts of over 10 BILLION (yes 10 BILLION) is mostly denominated in USD!!

Sometimes, their hedges go horribly wrong (do google) to the extent that Tony was forced to calm the public and shareholders down by promising no more such bets (... ironically they still HEDGE! LOL! ) (you could also google airline jet fuel hedging and practices)

Anyway, here's why it's not so straight forward...

1. Need to know their hedging positions. ( Me is too lazy to check their latest)

2. Jet fuel. (not same as Brent crude oil)
Yes, jet fuel prices has gone down quite a lot the past few months.
Last month alone, jet fuel lost some 9%!!!!
Anyway jet fuel used to be around 2.80-2.90 per gallon.
Yesterday, it's around 2.36+.
The drop is a lot, no doubt.

However, what's important for traders now is the next profit report for AirAsia is for the period July-Sep.
For this period, jet fuel went from 2.82 to 2.73.
Drop is not that big.

3. USD/MYR for this period, went from 3.20 in July to a low of 3.13 in Aug
Now this period is very important since Tony is a hedger, this is where it's complicated. what did Tony do? Did he get greedy and started hedging that the USD will go down somemore?
And since hitting that low in mid Aug, the USD dramatically made an extremely strong U-turn and closed out Sep around 3.27!!!

Also.... currently...... I think general market/economy sentiments is not that bull.... my thinking and I could be wrong.
So if people not that bull, they might not travel as much.......
Hence the cheaper jet fuel 'might'/'could' be offset by drop in air travelers.............

Not that easy bet.

p/s: IFCAMSC.



I was wrong to be skeptical about it when it was wrong 50 sen +

Yup...

one of them things......

Muhibbah proved me wrong also....................

black list in MRT project.

Le Don

Made a big mistake.

LOL!

AirAsia hedges their jet fuel hedging using Singapore Jet Kerosene.

http://www.cmegroup.com/trading/energy/ref...ap-futures.html

Here's to backup what I am saying about Tony's 'hedging' habits. LOL!

Quote from their May profit report:

As at 31 March 2014, the Group has entered into Singapore Jet Kerosene fixed swaps
which represents up to 17% of the Group‟s total budgeted fuel consumption for the
remaining quarters of 2014.

Quote from their Aug profit report.

As at 30 June 2014, the Group has entered into Singapore Jet Kerosene fixed swap which
represents up to 36% of the Group’s total budgeted fuel consumption for the second half of
2014.

As you can see, AirAsia hedged more on jet fuel hedges the minute he saw the down swing in prices!




---------------

Also:

http://www.theedgemarkets.com/en/article/a...ater-turbulence




This post has been edited by Boon3: Nov 19 2014, 09:45 AM

Is that so.

Anyway, I just don't trust the company enough to trade in it.

http://www.freemalaysiatoday.com/category/...t-site-tragedy/

http://www.theedgemarkets.com/my/article/a...ding-parliament


o.O

Le Don

Quote from yesterday report. See page 27.

As at 30 September 2014, the Group has entered into Singapore Jet Kerosene fixed swaps which represents up to 43% of the Group’s total budgeted fuel consumption for the 4th quarter of 2014.

The Group has also entered into Singapore Jet Kerosene fixed swap which represents up to 21% and 10% of the Group’s budgeted fuel consumption for the 1st quarter and 2nd quarter of 2015 respectively.

Comments:

As can be seen again, Tony's foot prints is clearly visible.

As SJK (Singapore Jet Kerosene) prices fell, Tony got AirAsia entering more fixed swap hedges.

Now on page 28.

AirAsia, via its hedges, now owns 2.74 million barrels of jet fuel!!!!

previous quarter, the amount was 1.1 million barrel.

A year ago, ie same quarter last fiscal year? Only 0.43 million barrels!!

This was mentioned:

As at 30 September 2013, the Group has entered into Singapore Jet Kerosene fixed swaps which represent up to 30% of the Group‟s total budgeted fuel consumption for the final quarter of 2013 with a weighted average price of USD123.13 per barrel.

* interestingly, AirAsia openly stated its average purchase price, which was USD123.13 per barrel.

Comments:

Now yesterday report was for the accounting period ending Sep 2014.

Look at the link yesterday again: http://www.cmegroup.com/trading/energy/ref...ap-futures.html

Clicking on the charts for Nov 2014, I see this:



As can be seen, yes a big decline was seen in Sep.... which is understandable why Tony increased AirAsia jet fuel hedges...

BUT as can be seen, the bigger decline in prices can be seen after Sep, ie in Oct.

WHICH MEANS.......

clearly Tony made these hedges way too early.........

(ironic isn't it? Just exactly like stocks, one should not start buying early in a downfall in prices!!! What is cheap, could get much cheaper!!)

now, AirAsia, as at Sep 2014, has hedged 43% of its fuel consumption for the 4th quarter.....
and " 21% and 10% of the Group’s budgeted fuel consumption for the 1st quarter and 2nd quarter of 2015 respectively"......

so with jet fuel.... becoming much cheaper now..... that means that currently 2.74 million barrels of crude oil was hedged at a much higher price!!!

(ps: not an accountant but I believe there should be some accounting losses from these hedges come next reporting quarter!!)

so back to the main question..... has falling jet fuel prices benefit AirAsia?



This post has been edited by Boon3: Nov 20 2014, 08:16 AM

Thank you for your insight

If the price of jet fuel continue to drop, Air Asia may benefit from it by next year. Still too early to buy

El Nino coming soon and B7 biodiesel program will be implemented this month. CPO price may increase soon so may be a good time to buy plantations soon