Well, its been oil and gas and more oil and gas, does it really matter which counter?
SP Setia - 500% run for the warrants, I am happy, upside limited from here on.
Affin - denied by CIMB and Affin, bottomline Affin will have to merge with someone within 6 months, bottomline, its still cheap ... single girl at a party with drunks, action not over yet.
Hap Seng Consolidated - the selling over last 2 days was apparently by a fund (local), over done, scary though ... if go through exercise should come out ahead even if you bought at RM7.40.
Air Asia - RM3.30 is about right in this run up.
Gamuda - haven't moved really.
DRB Hicom - when people say its a syndicate play, I say b.s., which syndicate has that kind of money to bring it up from 1.40 to 2.20??? shares being mopped up by you know who, an exercise is imminent, but we don't know when.
TA and OSK - Good volume, these two should be hitting 1.10 and 2.40 soon in this run.
Tokyo Trip
I have tons of photos on my camera, my iPhone, my friend's iPhone ... its so hard to get organised. I could be posting for a few days straight on this trip alone. Not my first time to Japan, but it was well organised. Now that AirAsiaX flies to Haneda, there is no need to join a tour, just take a similar itinerary as below free and easy:
Day 1: Asakusa, Sensoji temple, the rows of traditional snacks cooked on the spot delicious, just remember that you should not be eating as you walk, stay in one corner and finish your snack. Walk around Asakusa and then drop by Ginza.
Day 2: Roam Roponggi, esp Roponggi Hills, a modern architecture marvel. Move to Shinjuku, take in the x-rated dvd shops. Drop by Harajuku on the weekend as well.
the sumo wall outside the kokugikan
robouchon, good stuff
the takanawa street @ harajuku, madness
Day 3: Full day tour to Mt Fuji, Lake Ashi cruise, and cable car ride up the mountain. Then get to take bullet train back.Day 4: Spend whole day at Omotesando, forget about Ginza, this is very happening and fun. Must have lunch at Cafe Anniversaire, its brilliant and you will definitely get to see a wedding or two as the whole alley include a church setting for wedding events.
Day 5: Spend an afternoon watching sumo live, you will love it. My idol Asashoryu was recently fired for street fighting but the current yokozuna Hakuho is pretty good too. Great seats all around, can even see the cellulite on their ass.
Day 6: Shop at Shibuya. Catch a show at Blue Note Tokyo, unbelievably Christopher Cross was performing. If I was a week early it would have been Patty Austen, next week it would have been Earl Klugh. Brilliant.
There are other things you could do: Disneyland, take the 2 night stay at Mt Fuji/Hakone where you will get to enjoy traditional onsen with real hot springs, naked. You can take in the early sights at Tsukiji as well.
Try and splurge by going to a few 3 or 2 Michelin star restaurants such as Robouchon, Ryugin, Kanda, Koju ...
had to include this live abalone, the size of my palms, before the teppanyaki chef got to it ... yummm
On My Way Back
Its been a tiring 8 days in the Land of the Rising Sun ... now stuck at Changi on my way back to KL. Read The Straits Times and thought it was very funny to see UOB Kay Hian circulating a memo to thier staff on "how to do self exclusion" from the 2 integrated resorts. You can actually apply to have yourself barred from entering the two casinos, or your parents or spouse could do that for you as well, provided there are sufficient proof that you are a problem gambler.
Now, why would a top local broking house do that? Its a bit embarressing. A gentle reminder? Or do you already know of problem gamblers within your midst? Must be some over-power-hungry HR staffer trying to win brownie points.
As if you didn't already know that stocks investing is almost like going to the casino - except that we don't yell picture picture loudly ... we do yell profanities though, whether they are going up or down. Or is it that the broking house knows that more money lost at casinos will translate to less funds available for stock punting or "remisiers' collateral".
Anyways, came across The Black Swan book by Taleb again, I have one big black swan but this black swan is a positive one not a dangerous one. I think most people would have the US economy sputtering at 2%-3% growth in 2011 .... the black swan is, how about 5%-6%. Think about it.
My other early prediction in 2010 about CIMB buying Public Bank did not come true, not yet anyway ... temporarily, CIMB may have shifted its target to acquiring Affin Bank @ RM4.50 according to reliable sources. So reliable, that they had to call me up in Tokyo. Traders beware.
I checked prices yesterday with a friend and relayed the story, he said "no-la, CIMB came out with a buy report on Affin". I said, "I knew about the buy report 3 days ago, sometimes things are not so obvious, sometimes they are so obvious you forget to look a bit further.
Now, why would a top local broking house do that? Its a bit embarressing. A gentle reminder? Or do you already know of problem gamblers within your midst? Must be some over-power-hungry HR staffer trying to win brownie points.
As if you didn't already know that stocks investing is almost like going to the casino - except that we don't yell picture picture loudly ... we do yell profanities though, whether they are going up or down. Or is it that the broking house knows that more money lost at casinos will translate to less funds available for stock punting or "remisiers' collateral".
Anyways, came across The Black Swan book by Taleb again, I have one big black swan but this black swan is a positive one not a dangerous one. I think most people would have the US economy sputtering at 2%-3% growth in 2011 .... the black swan is, how about 5%-6%. Think about it.
My other early prediction in 2010 about CIMB buying Public Bank did not come true, not yet anyway ... temporarily, CIMB may have shifted its target to acquiring Affin Bank @ RM4.50 according to reliable sources. So reliable, that they had to call me up in Tokyo. Traders beware.
I checked prices yesterday with a friend and relayed the story, he said "no-la, CIMB came out with a buy report on Affin". I said, "I knew about the buy report 3 days ago, sometimes things are not so obvious, sometimes they are so obvious you forget to look a bit further.
Children behaving badly – Unmins
What is an Unmin? It is short for Unaccompanied Minor which is an airline term for children travelling on aircraft alone. In the vast majority of cases they are schoolchildren travelling too or from their parents’ overseas posting during holiday times. Frankly they can be an absolute pain in the butt. I should know. I was one.
These kids are handed over at the airport to an airline employee (often known as an ‘Auntie’) whose job it is to escort them to their final destination. Each child is supposed to wear a neck ribbon with a plastic pouch containing their documentation and identifying them as ‘young travellers’. If I recall my documents went in my back pocket and the pouch got flushed down the first toilet. Perhaps this is why so many airport toilets get blocked?
Actually you might be amazed by what gets flushed down airport toilets especially the one just before customs. I have seen everything from drugs to diapers and once a cardboard box of dried Nigerian fish. The most interesting thing I saw was a man taking one small suitcase and putting it into a second larger one. He then went to the baggage handling desk and reported the small case as missing whilst stating it was full of valuable designer clothes! Anyway, I digress, back to the Unmins.
As an airline manager based in Africa it was partly my job to manage these thrice yearly migrations, especially as I knew most of the parents in the region. I felt responsible for getting little Katie or Josh back to the bosom of their family although frankly I think the last person they needed or wanted to see was me. I think they felt I cramped their style somewhat especially as, with my childhood experiences, I knew all their tricks.
The girls were probably the worst. They would arrive at the airport all demure in their school uniforms and behave like butter would not melt in their mouths. Until they got on the plane that is. Immediately the seat belt light went off they would dash to the toilet where they created a long slow moving queue. Woe betides any aging gentleman traveller with a weak bladder because relief would be a long time coming.
What came out was not what went in. The plain little uniformed schoolgirl had transformed into an excellently made up woman in tight fashionable clothes that walked up the cabin aisle like it was a catwalk and then ordered a large gin. It all became very confusing and I once outraged a young woman from Barclays Bank by insisting she took her tarty clothes off and got back into her uniform!
The worst time was night flights. They used to party hard especially when the smuggled alcohol came out. I once caught two kids ‘at it’ under a blanket until I poured the contents of an ice bucket over them before things went too far. Another budding entrepreneur was charging boys $1 a feel. One irate passenger complained to me that the two children in front of him were drunk and rowdy. He said he was someone senior in giant oil company and there would be consequences. I did not have the heart to tell him the two kids were sons of his Chief Executive.
These Unmins did have their uses as some savvy passengers began to discover. They travelled the same routes all the time and knew the aircraft and any transit stops backwards. If you followed them you found all the short cuts, best bars and cheapest duty free sales and could save time and money. It was uncanny the way they knew which immigration queue was going to move fastest.
It was a relief to get to our destination. Women used to rush to the toilet and come out girls again. Strong mints were chewed to hide the smell of alcohol on breath and those ghastly pouches were placed over necks. They would walk off the plane like angels and choirboys. Occasionally we would have to grab one who tried to wander off and I once had to stop a lad skateboarding down the taxiway at Lusaka after a Boeing 737.
Everyone used to breathe a sigh of relief. Until it was time for them to go back to school that is!
These kids are handed over at the airport to an airline employee (often known as an ‘Auntie’) whose job it is to escort them to their final destination. Each child is supposed to wear a neck ribbon with a plastic pouch containing their documentation and identifying them as ‘young travellers’. If I recall my documents went in my back pocket and the pouch got flushed down the first toilet. Perhaps this is why so many airport toilets get blocked?
Actually you might be amazed by what gets flushed down airport toilets especially the one just before customs. I have seen everything from drugs to diapers and once a cardboard box of dried Nigerian fish. The most interesting thing I saw was a man taking one small suitcase and putting it into a second larger one. He then went to the baggage handling desk and reported the small case as missing whilst stating it was full of valuable designer clothes! Anyway, I digress, back to the Unmins.
As an airline manager based in Africa it was partly my job to manage these thrice yearly migrations, especially as I knew most of the parents in the region. I felt responsible for getting little Katie or Josh back to the bosom of their family although frankly I think the last person they needed or wanted to see was me. I think they felt I cramped their style somewhat especially as, with my childhood experiences, I knew all their tricks.
The girls were probably the worst. They would arrive at the airport all demure in their school uniforms and behave like butter would not melt in their mouths. Until they got on the plane that is. Immediately the seat belt light went off they would dash to the toilet where they created a long slow moving queue. Woe betides any aging gentleman traveller with a weak bladder because relief would be a long time coming.
What came out was not what went in. The plain little uniformed schoolgirl had transformed into an excellently made up woman in tight fashionable clothes that walked up the cabin aisle like it was a catwalk and then ordered a large gin. It all became very confusing and I once outraged a young woman from Barclays Bank by insisting she took her tarty clothes off and got back into her uniform!
The worst time was night flights. They used to party hard especially when the smuggled alcohol came out. I once caught two kids ‘at it’ under a blanket until I poured the contents of an ice bucket over them before things went too far. Another budding entrepreneur was charging boys $1 a feel. One irate passenger complained to me that the two children in front of him were drunk and rowdy. He said he was someone senior in giant oil company and there would be consequences. I did not have the heart to tell him the two kids were sons of his Chief Executive.
These Unmins did have their uses as some savvy passengers began to discover. They travelled the same routes all the time and knew the aircraft and any transit stops backwards. If you followed them you found all the short cuts, best bars and cheapest duty free sales and could save time and money. It was uncanny the way they knew which immigration queue was going to move fastest.
It was a relief to get to our destination. Women used to rush to the toilet and come out girls again. Strong mints were chewed to hide the smell of alcohol on breath and those ghastly pouches were placed over necks. They would walk off the plane like angels and choirboys. Occasionally we would have to grab one who tried to wander off and I once had to stop a lad skateboarding down the taxiway at Lusaka after a Boeing 737.
Everyone used to breathe a sigh of relief. Until it was time for them to go back to school that is!
What does a hotel brand really mean?
Does that seem a weird question? Probably so but what I am trying to say is, does the logo over the door actually mean, or importantly guarantee anything? Is it saying ‘This is a Hilton, Holiday Inn, Four Seasons or whatever and this means you should expect and get what that brand markets?
This question is borne from spending many years trying to truly understand and make sense of the hospitality industry. It is a vital sector yet commentators and industry bodies barely notice it when compared to say airlines. What does make it so very different? And why should anyone need to care?
I think the difference is ownership hence my original question. You see there are quite a few different ownership scenarios within a single brand. Because a hotel displays say Hilton over the door does not mean it is owned by Hilton. Very often it is owned by someone completely different but Hilton has the management or marketing contract to run it and is employed by the owner to deliver an agreed profit. They are an employee of the owner and have to act accordingly.
So what I am saying is that if you negotiate with a hotel chain you may not be speaking to someone who has absolute control over policy, inventory or pricing with all their properties. Hence you can find yourself in a position where various properties opt out of some commercial agreements which are good for the whole family but not for them. It is a bit like a global TMC who has to sacrifice profit in one location to deliver a good deal in other countries. Most TMCs have had to come to terms with this but I do not think hotels have.
The issue becomes even more convoluted when you are dealing with hotel consortiums. These are mainly pure marketing organisations where hotels (of a certain comparable quality) link their properties to an umbrella brand in order to take on the big boys and achieve global coverage. Again, this does not mean that such consortiums can tell these hotels what to do as far as pricing and inventory is concerned.
Probably still the most influential person in any hotel is its General Manage who can, and do, instruct their reservations office to close out heavily discounted negotiated corporate rates if they think they can sell for more. Even worse for the bigger corporations is when their travellers tell them that the hotel ‘price at the door’ is cheaper than that negotiated by their procurement department. Sounds familiar?
Another side effect of confused and disparate ownership is the woeful lack of management information you get fro the hotel industry. The only really useful thing IATA does for airlines is it provides a standardised language and reporting base that is essential for meaningful information. Hotels do not have this type of global format hence they all do things in different ways. You really would be shocked by how little they know about their customers and what they spend.
So what am I trying to say? I am advising all buyers to find out exactly what control/ownership of key properties a chain or consortium has. Maybe you should insist on key contract clauses like last room availability and lowest price on the day. Perhaps require countersignature by the GMs of the main hotels confirming they understand and support the contract. Finally, why not think of ways to make your oh so wise travellers become willing watchdogs by actively encouraging them to test the system. You know how they love it so!
By the way, I have mentioned a few hotel brands in this post. This has been purely for general illustrative purposes only and does not imply that I was refering directly to them.
This question is borne from spending many years trying to truly understand and make sense of the hospitality industry. It is a vital sector yet commentators and industry bodies barely notice it when compared to say airlines. What does make it so very different? And why should anyone need to care?
I think the difference is ownership hence my original question. You see there are quite a few different ownership scenarios within a single brand. Because a hotel displays say Hilton over the door does not mean it is owned by Hilton. Very often it is owned by someone completely different but Hilton has the management or marketing contract to run it and is employed by the owner to deliver an agreed profit. They are an employee of the owner and have to act accordingly.
So what I am saying is that if you negotiate with a hotel chain you may not be speaking to someone who has absolute control over policy, inventory or pricing with all their properties. Hence you can find yourself in a position where various properties opt out of some commercial agreements which are good for the whole family but not for them. It is a bit like a global TMC who has to sacrifice profit in one location to deliver a good deal in other countries. Most TMCs have had to come to terms with this but I do not think hotels have.
The issue becomes even more convoluted when you are dealing with hotel consortiums. These are mainly pure marketing organisations where hotels (of a certain comparable quality) link their properties to an umbrella brand in order to take on the big boys and achieve global coverage. Again, this does not mean that such consortiums can tell these hotels what to do as far as pricing and inventory is concerned.
Probably still the most influential person in any hotel is its General Manage who can, and do, instruct their reservations office to close out heavily discounted negotiated corporate rates if they think they can sell for more. Even worse for the bigger corporations is when their travellers tell them that the hotel ‘price at the door’ is cheaper than that negotiated by their procurement department. Sounds familiar?
Another side effect of confused and disparate ownership is the woeful lack of management information you get fro the hotel industry. The only really useful thing IATA does for airlines is it provides a standardised language and reporting base that is essential for meaningful information. Hotels do not have this type of global format hence they all do things in different ways. You really would be shocked by how little they know about their customers and what they spend.
So what am I trying to say? I am advising all buyers to find out exactly what control/ownership of key properties a chain or consortium has. Maybe you should insist on key contract clauses like last room availability and lowest price on the day. Perhaps require countersignature by the GMs of the main hotels confirming they understand and support the contract. Finally, why not think of ways to make your oh so wise travellers become willing watchdogs by actively encouraging them to test the system. You know how they love it so!
By the way, I have mentioned a few hotel brands in this post. This has been purely for general illustrative purposes only and does not imply that I was refering directly to them.
Hap Seng Consolidated Revisited
Assume 1,000 Hap Seng Consolidated
Cost = RM7,500
Bonus Issue: 2,000 shares
Total shares: 3,000 shares
Rights Issue (1 for 5): 600 shares @ RM1.33 = RM798
Warrants Issue (1 for 5): 600 warrants free
Total cost: RM8,298
Holdings: 3,600 shares + 600 warrants
Theoretical ex-all share price: RM3.00 - RM3.20
Theoretical warrant price: RM1.50 - RM1.80
Dividend @ 11 sen = RM396
Shares Value: RM10,800 - RM11,520
Warrants Value: RM900 - RM1,080
Potential Proceeds: RM12,096 - RM12,996
Cost of Investment: RM8,296
Potential Return (on the 3 month exercise): +45.8% to +56.6%
I am not the only one punching the calculator. The proposed placement of 124.532m new shares @ RM6.49 will bring about some RM808.21m cash to the company. Of that sum, RM240m is for capital expensiture for the existing group's businesses. RM300m is to pay down borrowings, and RM268m for working capital.
The rights issue will bring about another RM654m cash to the company. Of that, some RM220m is for potential land acquisition, RM200m for repayment of borrowings and RM234m for working capital.
Thats a lot for working capital if you add RM268m plus RM234m = RM502m.
Considering the amount for working cap and expansion, the company has injected a war chest of RM502m + RM460m = RM962m. In addition it will be paying down some RM500m in borrowings as well.
The new paid up will see some 2.689bn shares plus 448m warrants.
My theoretical ex-all price is based on the new fundamentals for the company, I could wrong or over-optimistic here of course. As things stand the ex-all price is around RM2.30. Judging from the lucrative exercise, there should be few sellers leading up to the ex-date. It should be well supported up to RM8.00.
Tokyo Rising Day 1 & 2
In Tokyo for now ... Pierre Gagnaire is a 2 Michelin star chef. Its pattserie is at the lobby.
Will be trying its degustation menu later on Saturday. Life is too short.
I must say, his tart was pretty mind blowing.
I must say, his tart was pretty mind blowing.
Days 1 and 2 at Tokyo ... had to rush back to Shinjuku Washington to get the Nagasaki beef .. the Manhattan Table serves very good Miyago Prefecture beeft and Nagasakui tenderloin. They are not your Kobe beef or wagyu beef type ... more like great OZ or NZ material, but much softer yet flavourful.
The yolky, chicken don at Roponggi.
The unexpected Shiseido Gallery building selling sweet stuff @ Ginza. Pretty good macarons.
TT Pierre Gagnier, the 2 Michelin star chef's pattiserie @ ANA Intercontinental Hotel.
Green tea and strawberry mousse.
Green tea and strawberry mousse.
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