Wednesday, May 7, 2008


Tips on Filling your Vehicle

Receive the below from one of the friend:
BUY OR FILL UP YOUR CAR OR BIKKIE IN THE EARLY MORNING WHEN THE GROUND TEMPERATURE IS STILL COLD. Remember that all service stations have their storage tanks buried below ground. The colder the ground, the denser the fuel, when it gets warmer petrol expands, so buying in the afternoon or in the evening.... your litre is not exactly a litre.

FILL UP WHEN YOUR TANK IS HALF FULL. The reason for this is, the more fuel you have in your tank, the less air occupying its empty space. Petrol evaporates faster than you can imagine. Petroleum storage tanks have an internal floating roof. This roof serves as zero clearance between the petrol and the atmosphere, so it minimizes the evaporation.

WHEN YOU'RE FILLING UP, DO NOT SQUEEZE THE TRIGGER OF THE NOZZLE TO A FAST MODE. If you look, you will see that the trigger has three (3) stages: low, middle, and high. In slow mode, you should be pumping on low speed, thereby minimizing the vapours that are created, while you are pumping. All hoses at the pump have a vapour return. If you are pumping on the fast rate, some of the liquid that goes to your tank becomes vapour. Those vapours are being sucked up and back into the underground storage tank so you're getting less worth for your money.

ONE OF THE MOST IMPORTANT TIPS IS TO FILL UP WHEN YOUR TANK IS HALF FULL. The reason for this is, the more fuel you have in your tank, the less air occupying its empty space. Petrol evaporates faster than you can imagine. Petroleum storage tanks have an internal floating roof. This roof serves as zero clearance between the petrol and the atmosphere, so it minimizes the evaporation.

IF THERE IS A FUEL TRUCK PUMPING INTO THE STORAGE TANKS, WHEN YOU STOP TO BUY, DO NOT FILL UP - most likely the petrol/diesel is being stirred up as the fuel is being delivered, and you might pick up some of the dirt that normally settles on the bottom.

Tuesday, May 6, 2008

Why Public Bank still a good BUY?

In today’s competitive environment, cost will be the effective way to judge how good one bank is. In this area, Public Bank is the most successful bank for Malaysia (33% compare to HLB 42% & MB 44%). Most of the staffs are hard working, thanks to the management who taking care of their staff well being.  In return, with this kind of working environment, create a good chain reaction.

 If you will to ask around what’s the most quality bank in terms of service efficiency, people mostly give you the answer, Public Bank. Yes, today if you go to Public Bank’s counter, within 5 minutes, you will be called. Even if the queue is so long, the manager will come forward and provide their service.  As a result, it managed to retain the existing customers as well as attracting new business.

 It has the lowest non performing loan (NPL) in the country (1.2% compare to average of 3.1% for industry). Thanks to the risk management policy and practice. When came the loan application process, if the amount is more than 3 million, uncle Teh will personally review the application, even though the team already pass the recommendation.  In this case, one should not compare Citigroup with Public Bank, since you never see Citigroup CEO personally review the application. Hence the risk is less for Public Bank to fall into the financing difficulties with its superior asset quality.

 Why Public Bank able to maintain the high ROE of 17 to 20%? Thanks to the loan growth and the operational efficiency. For the past 3 years, management have giving away most of the earning in terms of Dividend, last year, it paid 75 cents per share. This will give one Dividend Yield of 7% base on stock price of RM10.90.

For the time being, you may not find any of the other bank in Malaysia which beat Public Bank for all the above points. Hence, if one would to look for buying stock in Banking Industry, which one would he go for?

Sunday, May 4, 2008

Reasons why Public Bank not a good buy?

The below interesting article post by 黑俠:
PBBANK是馬來西亞管理最好的銀行!廢話,這大家都懂,但到底怎樣好法? 存款增長快,貸款額增長快;帶動收益增長,但呆帳只有1.23;因呆帳低,所以股東與資產回報為同行最高;資本適足比率處於良好水平,達13.6%;而且派息率高......旗下的信托業務,名譽為同行之最;保險業務的綜合比例低。PBBANK是好公司,無可質疑的,它也是唯一沒在97/98金融風暴出現虧損的銀行,這麼多好處,現在是否值得投資呢?


PBBANK的潛在隱憂

「專業」分析員稱PBBANK雖然是大資本公司,但仍高速成長,為此振奮不已!其實,PBBANK2003年開始,成長已經開始出現不平衡了!實際成長可說已暗藏日後的「危機」(「危機」這詞可能有些誇張),先看看PBBANK的盈利:

1995303,400 1996408,000 1997274,900 

199851,226 1999616,141

PBBANK97/98金融風暴後,在1999年就恢復風暴前的盈利,甚至遠遠超越風暴前

2000716,865 2001700,078 2002770,237 

2000-2002年,盈利增長緩慢,陷入停滯,複增長率是3.4%

2003974,186 20041,266,988 20051,450,281 

20061,795,161 20072,201,786 

2008首季=扣除Goddwill Payment,實際盈利517,387,比去年同期增長8.6

20032008首季,盈利出現驚人成長,複增長率是23%

PBBANK的股價也從2003年中擺脫盤整,開始了上升旅途。

PBBANK的派息率,一直以來都在50%左右

進入2004年,派息率高達167%200590%200684%

200788%4年支付的股利高達6,887,066(6887百萬)

各位PBBANK的股東是否感覺很爽???

但是,「危機」就此種下了!銀行是如何提高盈利的,方法可以說出一大堆,但若要穩健的成長,就是資本必須不斷的增加,資本增加,才能做更多生意,若資本不增加,再怎樣成長,都有一定的侷限。而PBBANK的股東投入資本,自1995年的2,117,500,經過金融風暴,仍可穩建成長至2003年的8,617,795。但自2004年開始了高股利政策,至2008年首季,只有8,757,697,可見投入資本沒增加。投入資本沒增加,那PBBANK2004-2007盈利是如何年增長23%的呢?

答案是:外求資本!這期間,PBBANK的資本增加了86,011,703(860)

其中:銀行存款增加72,254,014(722),發行新股1,505,062(15),發行次級票據2,829,055(28)2008起未來5又發行50次級票據(Subordinated Notes)這本來沒問題,銀行本來就是「借錢滾錢」「財務槓桿」行業,PBBANK的呆帳率仍很低,但是,資產回報率卻從未派發高股利時的1.50%,跌至2007年的1.26%

這裡我嚴重聲明,PBBANK的爛賬還是很低,資產回報還是很高,甚至是同行之最。盡然如此,還有什麼問題呢?

PBBANK目前看不出問題,但關鍵在於,財務槓桿總有一個極限,否則會造成抵禦災難來臨的能力下降,而且一旦監管失誤,就會造成嚴重損失!多數人有種錯誤觀念,認為銀行很穩定,其實,只要了解銀行是如何賺錢,就知道銀行的風險很高!請想一下,日本80年代末經濟泡沫爆裂後的銀行;2007年的美國次級房貸危機,多少間金融機構遭殃,其中包括世界最大的銀行CITI GROUPPBBANK過往的財務槓桿情況如下:

199515.6 199614.8 199714.5

PBBANK金融風暴前的財務槓桿

199812.9 199911.5 200010.0 

20018.5 20029.0 20037.5

金融風暴後財務槓桿逐漸降低

200410.7 200513.1 200616.3 200718.6 

因高股利政策,導致收益無法留存,債務提高了860億,財務槓桿越來越高,超越了金融風暴前的水平,若無高股利政策的話,那股本約有11,927,839,財務槓桿約有14.9倍 如果銀行過度的運用財務槓桿,會增加經營風險,一旦經濟環境轉壞,或者為追求短期利潤而忽視風險,如過度放貸、投資衍生產品、資產證券化等,財務槓桿擴大,潛在風險增加,以下是CITI GROUP的財務槓桿變化:

200013.6 200112.9 200212.6 200312.9

200413.5 200512.2 200615.7

2001發生911,進入低利率時代,2006-07年為抗通膨,轉為升息

200719.2----->>次貸爆發,CITI GROUP虧損幾百億美金。

你們知道CITI GROUP在次貸爆發前,財務狀況如何嗎?

呆帳率  =1.32%(夠低吧?) 資產回報1.14%(收益優良)

資本適足率=11.65%(高於標準) 風險加權資本比率=5.16%(高於標準)

雖然在執行巴塞爾II條例和沒有強制轉移25%的常年盈利至法定儲備下,PBBANK的資本比率料也將獲得提升。其銀行風險加權資本比率(RWCR)和資本適足率(CAR),料將可分別取得70個基點和50個基點的增長。但是,鑒於CITI GROUP的例子,

可見這些衡量風險的計算方法,不能充分反映出未來的潛在風險!


PBBANK的價值估算

PBBANK最新財務數字對比股價是(截筆時):

股價:RM11.40 對比 NTARM 2.614.37

股價:RM11.40 對比 2007 EPSRM 0.62918本益比

股價:RM11.40 對比 2008 EPSRM 0.69016本益比(個人預估)

因行業結構問題,銀行利潤再怎樣高,都有個界限,其股價不應超過NTA3,而PBBANK卻有4.37,顯然過於昂貴..PBBANK股價太高,投資風險性較高..如果現在買進PBBANK,那你是多付個月的錢,先為2008未知的業績埋單!假PBBANK可繼續最少年以最少15%的盈利成長,那現在買PBBANK肯定能賺到錢!前提是未來成長可持續..我估計今年盈利約2,222,8232,380,288EPSRM 0.66RM 0.71之間


PBBANK成長真的沒問題嗎?

PBBANK在發行新的50次級票據後,財務槓桿會高達20 / 21倍,就風險管理而言,已到了頂限!2008股市低迷,相信它的信託銷售及股票相關業務,盈利縮減可能性高;

建築領域放緩,不少大型計劃的取消,會減少借貸活動;PBBANK近期宣布與ING保險公司合作通過本身的基建設備和網絡在全國銷售ING保險的銀行保險產品,分析員估計可提高PBBANK08財政年和09財政年的盈利4.5%4.2%每年可達70億至100億。簡而言之,PBBANK的未來成長,還是有不少未知因素!我早前說過,成長需要資本,PBBANK的資本雖提高,但卻是建立在激烈的財務槓桿運作,實際上已達極限,若不控制降溫,隨時有引火燒身的風險,何況誰能知道大環境何時轉壞呢?因本地成長空間已經飽和,新市場已不多,只能努力開拓殘渣和搶對手的市場海外的盈利雖增長31.5%,但佔集團2006年的稅前盈利13.7%,只微升到2007年的14.5%,短期不可能給PBBANK帶來顯著成長2004年以來的成長,主要還是建立在高財務槓桿下,長期下去是無法持續的,估計其盈利成長會緩慢下來!若它還出現快速成長的情況,那絕非好事,反而更加危險,財務槓桿不斷提高,只要時辰一到,必然遭到反噬!所以,別以為PBBANK的盈利成長遠大於同行,一定是好事,這是要付出代價的!PBBANK要降溫,必須要先犧牲短暫的盈利,以及股價的下跌

1.減少股利,降至30%以下的派息率

 但這會引發股東不滿,造成股價下跌!像某證券分析員說:PBBANK未來5年發售50億令吉的次要債券將可增加該集團的股息派發額。可見重視短期利益之心態多熱烈,完全忽視長期風險

2.加強風險管理,複查貸款素質

3.減少財務槓桿的借貸投資,努力增加股本


PBBANK投資者該如何處理?

如果一早投資PBBANK那不隨意賣出,只要好消息不斷,股價會起,就守住但要知道潛在風險所在,一旦發現增長趨緩、財務槓桿越發嚴重,或感覺不對,就賣出! 至於沒買進還是別買,反正好股票又不只1個......

PBBANK就像一輛失衡的駟馬車,一隻急奔;一隻吃力追趕;一隻緩慢行走;一隻停下吃草; 這樣的馬車,你認為能跑多快?跑多遠?唯有停下調整步伐,才能穩健行走,否則必然出事!

No Money No Talk!

More than 30,000 of shareholders, gather at Ohama City, just to look for meeting with the world's most richest man, billionaire Warren Buffer, who is the world's most successful investor. The crowd has grown bigger every year as shareholders bring family and friends to hear 77-year-old Buffett and Berkshire vice chairman Charrlie Munger, speak. 

Buffett cautioned shareholders that returns in the years ahead from the company's equities portfolio, as well as gains from its own stock, are likely to be lower than those seen in previous decades. He will be very happy to generate gains of 10 per cent a year from common stocks over the long term, but questions whether that will happen.

Buffett says Berkshire has become so large that it's now difficult to find investments that are big enough to influence the company's results materially.

"What we really like is buying large, first-class businesses and just sitting there." But, he adds, that would not produce returns like the past. "Anyone that expects us to come close to replicating the past should sell their stock. It's not going to happen."

Munger says that the current credit crisis is worse than the market disruptions triggered by Enron's bankruptcy earlier this decade. After Enron collapsed, US legislators passed the Sarbanes Oxley Act to try to prevent such massive frauds rocking markets in future. "We now know they were shooting at an elephant with a pea shooter," 

Unlike most shareholder events at which questions are company-focused, the Berkshire meeting is always full of questions about life, the world, corporate leadership, and governance.

Last year, a 10-year-old girl went up to the microphone and asked for life advice. Buffett told her to read a lot as he had never met any smart people who did not read. Munger told her to be reliable when she grew up. The meeting went quiet and then erupted in applause. Some paused to reflect, some nodded with total agreement.
 
* The question and answer session began with one shareholder asking how to be a winning investor. Buffett said people should look at stocks as owning part of a business, use the stock market to serve you and not instruct you and to leave a margin of safety. Another questioner asked where Buffett could expand on where the stock market is headed. Buffett laughed and said "I could expand, but I couldn't answer." Buffett said he and Charlie have no idea where the stock market is headed. He said the question never comes up, because Berkshire invests in companies, not the stock market.

* A shareholder asked Buffett how he stays healthy. Buffett took a piece of See's candy and said "You start with a balanced diet." Buffett says he works out 45 minutes three times a week with a personal trainer, otherwise he does what he wants. He says he likes Mar's candy, Coca-Cola and See's. Buffett says very important factors for him have been a job he loves with people he loves to work with. He gets to work in an air-conditioned office with all kinds of help. He asks "How can you be sour about life when being blessed in so many ways?"

* A shareholder asks about Berkshire investing in Kraft. Buffett says most big food companies are good investments. Strong brands are good assets. He says Coca-Cola, See's, Mars candy all are strong and it is difficult to challenge those brands. What Berkshire buys might have something to do with the price and the management.

* A shareholder asks about investing in small banks or large banks. Buffett says it is good to know the culture of the bank. He says Wells Fargo is one bank Berkshire has invested in that it believes will avoid financial stupidity.

Is it time to buy Stock now?

Recently one of my friend post me the above question through email.  This is  very interesting question, in view of our local stock market is in bull phase since June 2006, come to this year 2008 is nearly two years old. From the past history record, local stock market seem to have the average bull phase of about 2 years. If you would to ask me if now is good time to buy, the answer is Yes and No. Yes - if the price is right! No- if the price is wrong!

Let's look at the top 15 high dividend stock's performance since 2006 and dividend Yield as below:
1) Berjaya TOTO 9.4%
2) Bintulu Port 8.4%
3) Amway 8.3%
4) BAT 7.9%
5) Carlsberg 7.9%
6) JT Intl 7.4%
7) Guiness 7.2%
8) Gamuda 7.1%
9) KFC 6.6%
10) DIGI 6.3%
11) PBB  6.2%
12) Star 6.0%
13) TH PlantationsTH 5.8%
14) Axis REIT AXIS 5.8%
15) Atrium REIT 5.5%

If one were to buy the above 15 stock since 2006, he will have the paper gain of about 25% on average (assume he not yet sell it) and Dividend of 7.5% (which is a lot better than bank's FD). 
Among the top gainer would be Digi, which we notice it's 2006 price was RM12.10, compare to today (Apr 2008) of RM24.20. This is the 100% capital return. The 2nd place would be Public Bank, from RM6.75 to today's RM11.50! A handsome profit of 70%! 
The rest of counters are in the range of 10 to 30% gain, except on stock, Carlsberg, which decline 20%. Hence, overall still gain 32% including dividend. Assume we own all the above 15 stocks, would you going to sell it today and take all the profit now? We are not here to predict the market and we are not in the position to do so as well, since no one can actually predict the market accurately. 

Let's take a broader view of what's happening in world, the crude oil and commodities price are almost at the highest record (including rice price), few countries already feel the heat of this situation. Today's market will get cut short by a number of things, just like what happen in the past. The least expected thing can happen at the wrong time!

Are you afraid of what may going to happen and sell all the stocks you own today?
Or are you waiting for what's going to happen and buy the above stocks at a right price?