Sold TGuan @ 0.90

After thinking over weekend, i decided to close my position in TGuan.

I have been buying and selling this stocks. Thus the average cost for the stocks i bought is 0.825 , selling price is 0.90 with dividen 4 cent. Total earning for this stocks is (0.115 / 0.825) 100% = 13.9 % Net earning = 11% over 6 mths. Not impressive at all. The reasons why i am selling this stocks is because , i see KLSE are way too hot , today transaction volume hit RM1.7billion, this is abnormal at the rainny days, is market really that good/hot? I

When i gone into details of TGuan financial report, i discover something. For 100miliion+ revenue it makes, it only return with 5 % net profit. The profit margin is too low. I have not seen any progressions to improve net profit. TGuan are targeting overseas market for it export business . Apparently, Strong Ringgit policy will not benefit them. For every 1 % when Ringgit appreciate, it will result profit decline of 1% in Tguan. If their price are no longer competetive, they will not have advantage in overseas market.

Considering a few factor, i decided to withdraw my stacks from this company. I do not know wheter i will regret or bitch about it if it soars, but i practice to invest cautiously. KlSE has reach 1430,while world market has been volatile. Obviously, there is risk. My experience told me that i should close this position and wait the right timing for better stocks. I had one in my mind. I need to be patience and wait.


"In this picture Volkswagon Tiguan "

Hold - TGuan

Quite regret that i didnt sold off when it touch 1.12 and buy back now. My AVP is 0.825. Is buy and hold in long run will be profitable? I do not know.

TGuan price has been dropping in the recent market correction. Maybe i should consider to buy somemore? I see value in this stocks, but market are irrational. 0.825 is definetely a good buy. Another point of view, i pay 0.825 for all the inventories, it still give me 0.22 cents cash per share, after netting off everything.


Ok. Back to its finacial report 2nd quater
share issue 105,204

Revenue increase to 111,067 from 102,139

1. Inventories - 85,332 / 105 204 = 0.811
2. Cash - 34050 /105 204 = 0.323
3. Cash - 7438 / 105204 = 0.07
4. Short term dep inc - 7438 from 2950
5. Reserve Inc - 106,919 from 99202
6. Short Tem Borrowing Inc -30789 from 22,332 prev
7. Long Term Borrowing Inc - 5143 from 209 prev
8. Trade R = 68192
9. Trade P =52216

TR - TP - LTB - STB = 68192 - 52216 -5143 - 30789 = -19956
Debt per share = -0.18


Quatertly EPS = 4
NTA - increase 8 cent to 2.02 from 1.94.
Dividen = 5%

2nd quarter earning is no suprise . I just take the minimum assumption, first and 2nd quarter EPS 9cents, 3rd and 4 quarter market no good make 6cent. EPS 15cent. This stock shld value at least 105 cents. If 3 and 4 quarter eps reach average 8 cent. One year eps 17. If 3 and 4 quarter doing well then eps 19.

valuation
15 x 7 = 105cent
17x 7 = 119cent
19 x 7 = 133cent


The sales normally peak during festival seasons. Currently market sentiment no good. I decided to hold one more quarter.

TGUAN

I ask A, A siad this one can buy. Last time csc i also ask A, A said can buy. Must have faith he never lie to me. So What i bought today

Let me analyze
tguan x 11000 @ 0.82

why buy this?

1.Based on recomendation from investment guru's Hutu

3Q09 eps = 10.56
Projected = 15

Actual
FY09 eps = 13.51
cash per share = 0.3522
net cash company
NTA = 1.93

current asset 177,910
current liability 72,264
long term borrowing 207
cash 37,060 increase
share 105,205

cash per share 37060/105,205 = 35.22c
cash vs share % 35.2/0.82 = 42.95% --> cash rich
trade receivable acceptabe. potential to give dividen. ( so , it was truth coz announce that it pay 4 cent dividen)

Receivable turnover Ratio
tguan = 68575/403,060 x 365 = 62.09 (Actual Full Quarter)

If Trade Reveivable + Inventories net of Trade payables and borrowing

Invotories value roughly 74,000/105205 = 0.70(minimum)


industrial benchmark pe = 10
if pe = 10 this will translate to share price 1.35

potential to be 1 bagger

price(march) vs eps(FYEnd)
2002
1,27 vs 10.2 benchmark =12

2003
3.1 vs 0.206 benchmark = 15

2004
2.25 vs 0.2548 benchmark = 10

2005
1.75 vs 0.2144 benchmark = 8.16

2006
1.47 vs 0.2033 benchmark = 7.23

2007
0.86 vs 0.1139 benchmark = 7.55

2008
0.70 vs 0.042 benchmark = 16.6

2009
0.82 vs 0.135 = ???? (undervalue)

A first and final tax exempt dividend of 2% ( 2 sen per share ) amounting to RM 2,104,090
in respect of the financial year ended 31 December 2008 was paid on 7 August 2009.

So i projected the 4cent will paid on 7 August 2010 this year.

What i bought today - TGuan

What i bought today

tguan x 11000 @ 0.82

why buy this?

1.Based on recomendation from investment guru's Hutu

3Q09 eps = 10.56
FY09 eps = 15
cash per share = 0.25
net cash company

current asset 153,571
current liability 54,874
long term borrowing 235
cash 26,570
share 105,205

cash per share 26,570/105,205 = 25.2c
cash vs share % 25.2/0.82 = 30% cash rich
trade receivable acceptabe. potential to give dividen.

Receivable turnover Ratio
tguan = 65940/293602 x 273.75 = 61.48days (3Q)



industrial benchmark pe = 10
if pe = 10 this will translate to share price 1.50

potential to be 1 bagger

price(march) vs eps(FYEnd)
2002
1,27 vs 10.2 benchmark =12

2003
3.1 vs 0.206 benchmark = 15

2004
2.25 vs 0.2548 benchmark = 10

2005
1.75 vs 0.2144 benchmark = 8.16

2006
1.47 vs 0.2033 benchmark = 7.23

2007
0.86 vs 0.1139 benchmark = 7.55

2008
0.70 vs 0.042 benchmark = 16.6

2009
0.82 vs 0.15* (undervalue)