rather than the 'market inefficiencies' citing insider information of bonus issue, another real reason for the run up of the stock price is its stellar business performance in 1HFY10 results
you can get the report from bursa malaysia
from annual report, it is cited that
The Group is adhering to its dividend policy by paying not less
than 50% of Profi t After Tax as dividends to shareholders.
what this means?
Hai-o profit jumps 57.8% year on year. This will virtually means more dividend in the future.
in addition, PE is going to be down due to improving EPS. Added with more liquidity post the enlarged share capital, it has all the ingredients to go up in next level, at least in term of stock price performance.
let's not forget that stock price is not the only concern here, in fact the real concern should be the real business that it is doing. Its MLM business, which make up 70% of the profit, can perform so strong even in economic crisis time. And this is only mainly from Malaysian operation. I would want to imagine that there will be another surge when they are opening up Indonesian market.
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2 comments:
no doubt... but your comment on indo seem like deviate from your fundamental... more on speculation.... haha..
but in fact i am now very confident with the management team now for this biz.... buy more....
Heng Kar,
I think you should really go to their MLM talk and then tell us how is their business model.
From what I visited the shop, the sales in the retail shop is really so-so only.
But of course, Hai-O now is actually more a MLM company, where a big portion of revenue and earnings is actually comes from MLM.
Giap Seng
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