Wah I've been waiting for Maybulk to touch RM3.50 again and will pick up some. But the way BDI corrects itself is scary.

The problem with Maybulk strategy as I see it is, they expected a lower volume of trade in 2008/9, so they decide to sell some of their ships. But their contingency to charter ships if demands picked up has costs them more overheads for their revenue, since it's almost as expensive to charter a ship and getting revenue for the charter in the first place.

If I'm not mistaken, they sold almost 3 ships already. And last quarter they were chartering ships to do their hauling which increased their operating costs.

Late April and May is good as the BDI shot up back to new highs, but as it is correcting itself back this month, their 2nd quarter would still show less revenue. But it is expected their 1 time sales proit of their ships would be reflected in the next results.

Maybulk..

The prices of old vessels oledi appreciate 200%. So it is quite logically to lock in profits, and charter some vessels.

At more appropriate time ( economies worldwide are not doing well ), then buy back.

A good transportation company does not usually depend 100% on internal vessels.

If business drops by let say by 30%, then the vessels would be left idle or leased out at a loss.

Kouk Brothers like to expand during recession when assets or companies are going cheap.

What they do have something to do with the future ( of the economies ).

Robert Kuok was a very good sugar future trader in his younger days. He moved with calculated risks.

This post has been edited by SKY 1809: Jun 13 2008, 08:30 PM

But then nowaday Robert Kuok is some wat off-hand... It's all left to his son or relatives (Kuok families)

So the theory of robert kuok risk calculation may not applies anymore....

Even though it's quite safe to say robert kuok won't let his investment down the drain.. but do not discount the possibilities....

Anyway... I've took Star Reit @ 0.845

However, anyone has anything to say about it?

As far as I know Star Reit is heavily dependent on YTL group for its earnings....

No exactly. Reit earning is depended on tenants of the properties. So Stareit earning is depended on Lot 10, JW Marriot Hotel and Starhill tenants. Although YTL is a major shareholder of it and is under YTL group, its earning is not through YTL group business, except/unless YTL group company rent the properties typical eg. would be AMfirst whereby AMbank group is its major tenants. Then for AMfirst, it can say AMfirst's earning is highly depended on AMbank group.

Buying Reit is not as same as buying company share, it has some differences compared to normal shares. So please don't treat it as same as normal share, one will be disappointed if treat it as normal shares. Upside potential is not as much as normal shares unless market goes crazy and bubbling.

This post has been edited by cherroy: Jun 13 2008, 09:11 PM

Why you buy their shares then ?

If you think it is wrong, then now it is the right time to sell them off .If I were you.

If you do not have a bit of trust in the good management of Maybulk or Pbank, basically it is good for you to stay away from Bursa. Some investors believe there are 5 good companies left in Bursa.

This post has been edited by SKY 1809: Jun 13 2008, 09:37 PM

Yea... If you were checking the Stareit properly, you will find out more than 50% of the tenant is actually YTL Group....

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Added on June 13, 2008, 10:05 pmI buy their shares because of the management capability not the brand name of 'Robert Kuok'.

Thus if one just buying the shares because of 'Robert Kuok' name, then it's dangerous as he's some what hands off...

This post has been edited by keith_hjinhoh: Jun 13 2008, 10:05 PM

Did I imply investors to buy shares just bcos of Robert Kuok ?

I just casually mention he was a good sugar trader.

But you have to know who is behind a good management team, whether a company is GLC or political linked even it has a good management,

This post has been edited by SKY 1809: Jun 13 2008, 10:15 PM

You're saying he's moved with calculated risk but this is not the case as he's some what hands-off...

Thus if you're just buying Maybulk or any Robert Kuok related shares and you incorporate this factors...

This is not right. You've biased in the first place.

In fact, a good management team should not have something behind. Big Shareholder is such as trust funds, pension funds are mainly there to scrutinies the actions of management. They should not participate in management or intervent unless the management is doing something silly. Else it will be conflict of interest.

This post has been edited by keith_hjinhoh: Jun 13 2008, 10:21 PM

You are making conclusions basing your own assumptions , not wrong anyway.

A good management cannot manage in air. They are answerable to Board of Directors. Many things still need board approval. Directors are also answerable to shareholders.

Both management and directors are removable, but not the shareholders.

Sales of vessels need board aprrovals, even if the CEO is very powerful ( Companies Acts of Malaysia )

I mentioned he was during his younger days... ...take note.

This post has been edited by SKY 1809: Jun 14 2008, 10:07 AM

Err, whhat assumptions and conclusion i've made anyway?

I'm just stating out the facts...

Management are answerable to Board. Board are then answerable to shareholder. It's suppose to be like that.

Putting back into that phrase, dont you think it leads people to think that way?

Anyway, OT.

Anymore opinion on the Stareit I've bought?

Amfirst is the one I am mostly aware of conflict of interest between its reit and major shareholder. Still I had bought some in it.

But for Stareit, I don't know YTL tenant contribute as much as 50%, thanks for highlighting anyway.

Still I opt for Reit for its yield, instead putting in FD that yield 3.xx%.

As long as those tenants lease is more than 3 years and above, that's mean in this 3 years I can expect the yield to materialise. The one I mostly prefer is Axis reit. Between reit I got, Axis reit is the one I have the most. They are the most diversify and having 13+ properties range from office to industrial.

Instead buying properties and rent it out, I prefer reit which is less hassle which is the primary reason I go for reit. Sometimes I treat them as FD only.

Just my opinion and preferences, doesn't necessary right nor guarantee to make money.

Kinda somehow agree on it. Calculated risk doesn't mean will guarantee make money as well. Transmile is one of the typical example.

Nobody is god in investment, just they have more success story than failed story that make them successful. It is impossible to have every single investment that is making money, just one make more than loss then it is considered mission accomplished.

Invest into a particular share is because you are confidence about the company future, but not because whether it is ABC family or XYZ person that owned it, although it has some factors in it for good management team, just one starts with core consideration is the company management manage to deliver the result.

But nonetheless, given the YTL group cash position and their future growth. In short term, I see no reason they will move out their office lot and some of their leases from StarReit. In longer term, if YTL Group no longer financially sound. Then it should trigger a sell on StarReit too...

The things I dont like about Reit is when their location and properties are so diversified, I can no longer see how well is the location is doing... How much the location worth and so on...

I Prefer touch and see... It's quite proud to be in StarHill and claim i'm just 0.0000000005% of the owner....

Diversified has its good and bad.

One thing good about reit price currently is that they are trading at mostly 10-15% discount over its NAV as anticipated property sector bearish time ahead, as well as potential higher interest rate in the future which I highly doubt FD rate will go higher or go higher as much.

The more discount to their NAV, the more protection on its downside. As long as those property is in strategic location, the property value is there which won't evaporise like those PN17 company.
In fact strategic location property value with good demand only will rise due to inflation in the longer term future.

The good thing of having consistent dividend stock (including reit) is that after 10 years+ or so, basically one has recoup all its initial investment. Even company goes broke, you basicially lose the opportunity cost (FD interest). So after 10 years+, those left over on the share price or future dividend yield is your net return already, just how much as compared to FD interest only.

That's just my personal view which I feel comfortable in investing in dividend stocks which has good consistent result of dividend based on their core business profit. That's also I find difficult to convince myself in investing in the stock like Airasia (highly growth stock that give zero dividend) although I am attracted by its penny stock (0.88).

Very true... But i'm on the safe side.. I actually prefers to see and touch things...

I often trade with OSK that's why i have OSK.

I have confident with YTL group strong financial position, that's why I have YTL. Their track record is good too.

I have confident with Maybulk management, that's why I have Maybulk. I like their annual reports too. But too bad, I can't pay them visit. Else i'd have buy more of maybulk.

I have confident with Help too, I do pay them some visit.. But I have no confident with their track record yet... As they're still new, any bad news will trigger a sell from me...

I have often went to PBBank and HLBank too. That's why I'm targeting PBBank and HLFG.

While I regularly went to GSC Cinema, and PPB is in 'monopoly' situation, they're quite on the safe side... But price is too high ATM... Most probably premium frm Wilmar.

GSC is just a tiny bit or small peanut for PPB group. Instead I view them running those cinema for 'fun' only. Haha.

I personally don't like college business though, too unpredictable.

I prefer to buy SPB (SPB wholly owned Help before it is listed). I got SPB at Rm2.xx before this round of bull run started (2006-2007) but sold off at 3.xx level already at several stage. It did go as high as near to 5.00.
Some sort of profit lock strategy prompt me to sell.

No worry, my Help holding is preety low. So I will see how it goes...

I've done some research. Courses offered by Help is pretty up to standard and they produce some good students too.

Let see how it goes... My entry point of Help is preety low... On par with IPO Prices, so anything happened I should have enough time to lock my profit..

Aiya, Holland game coming next. Go relax guys.

About REITs

I agree that the returns are much better than FD rates.

However, I think the property values could have reached the peaks in Malaysia.

In view of political uncertainties and high fuel prices, the foreigners may want to wait and see. Do not discount the possibility of them selling off ( buyers turn sellers ). If US currency were to strengthen , then their properties may drop in value ( currency loss ).

If businesses go bust, it does not matter whether the tenant agreements are for 3 or 5 years. The rental values would drop too. It is a cycle.

REITS launched recently are to take advantage of high property prices and slower economy ahead.

This could be an impact on Net Asset Value ( if economy deteriorates ), and hence prices of shares drop. The returns may or may not be able to cover book losses . FD could be a better choice.

However, for long term investors, the impact would be less.

Just my 2sen second opinion.

You are entitled to your own investment decisions.

This post has been edited by SKY 1809: Jun 14 2008, 09:59 AM

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