Outlook, Long Term Trends, Business Updates

Volatile Outlook is maintained into year end. 

Property stocks in Penang and Kuala Lumpur are likely to do well as long business conditions remain stable including developments i.e. by Titijaya Land Bhd, and Ken Holdings Bhd in Forest City of Johor with its duty-free status since March 2016, should developments continue unimpeded. The property market has obviously slowed down due to numerous reasons, among them, lower number of bank loan approvals as mentioned in the past.

For more on Property Investment/Stocks:

https://iliveidreamitranscend.blogspot.my/2014/09/properties.html

[ Note: The above article is from Sept. 2014 but is still very much applicable as the dynamics of property investment typically does not change much ]

Consumer technology based stocks are likely to suffer more in any downturn. During this period, people tend to allocate more of their money and resources towards necessities i.e. food and pleasurable activities as such travelling. Nevertheless, companies as such Apple should continue to do well especially with upcoming IBM-join-venture service products launches i.e. in medical field wherein iPads may be used to accurately diagnose xRay scans instantly via Watson’s computing capabilities among others. 

Hence, the Food and Beverage (F&B) industry should continue to do well as long as prices reflect the spending power of local markets and costs of F&B business operations do not increase dramatically. Even if cost do increase, i.e. should Starbucks suffer from an increase in coffee bean prices caused by some fungus, they should be hedged from forward contracts if done properly. This will allow enough time for astute traders to roughly ascertain impending cost pressure that might affect profitability and possibly even dividend payouts. For longer term investors, the ever increasing trend of coffee consumption in particular Asia should be a boon for well positioned companies as mentioned Starbucks and Oldtown Bhd or even Super Group Ltd.

[ Note: Coffee is a form of commodity. The article below is regarding the coffee fungus ‘epidemic’ also know as coffee rust that hit around 2012 globally

http://observer.com/2015/09/central-americas-slow-recovery-from-coffee-ravaging-epidemic/ ]

The Long Term Trend given today’s developments would be advancement and good returns in these industries: 

Healthcare, Education and high-tech based companies i.e IBM. 

[ For more on Long Term Trends: 

https://iliveidreamitranscend.blogspot.my/2016/07/manufacturing-globalisation-localisation.html ]

Interesting Updates & News - Malaysia

• A New market for Small, Medium Enterprises (SMe) to be created for SMes’ not yet ready to be listed on the ACE exchange: http://www.thestar.com.my/business/business-news/2016/09/02/bursa-releases-paper-on-new-listing-market-for-smes/

• Private Equity (PE) companies are ramping up promotions as to how they can not only invest and profit from investing into local businesses, but from also bringing in knowledge and expertise to help management in expansion and in enhancing profit maximisation strategies. As long as business founders and PE operators can both come to an agreement on business direction, both parties stand to benefit much. 

• Change in Takeover Rules for Public Companies on the Bursa - August news
  http://annx.asianews.network/content/mixed-views-malaysias-new-takeover-rules-25786
  The above article is a followup of
  “PRIVATISATION TALKS of your stock/share/saham” from previous post;
  https://iliveidreamitranscend.blogspot.my/2016/03/positive-bursa-news-big-quotes.html

• Consumers of financial products can resolve disputes with financial service providers for cases up to RM250,000 for free including insurance claim disputes via Ombudsman for Financial Services formerly known as the Financial Mediation Bureau since 2005.
  For more view their website: http://www.ofs.org.my/en/scope 

Until next time, happy value investing.

[DISCLOSURE: The writer currently owns minority stake in Oldtown Bhd among the mentioned stocks as of 30/09/2016 under his personal account. JR Capital LLP has minority interest in IBM among mentioned stock as of mentioned date.] 

[DISCLAIMER: Everything stated in this blog is purely the opinion of the writer and any decision taken should be based on sound judgement with risks fully born by the decision maker. The writer shall bear no responsibility for any losses due to adherence of advices blogged by the writer or any commenters.  Informational discrepancies are possible and will be corrected if any.]