With the 'phenomenm' swing by Haio from RM8 down to RM6.2 and now back to RM7.6, a 22.5% swing over the course of 1.5 month. i decided to find some trace as to why this happen. i couldn't find any relevant infor and has to conclude that it is purely sentimental driven.
i have a friend who has, under my constant promotioning of the shares, having some discussion with me on haio. He has previously shunt the stock, preferring glove stocks, which i shunt. However, months back he has said haio has forged some alliance in china and will probably do some great business in china. Referring to this actually what i do understand is indeed Haio has forged some alliance in china but its near future growth is not in china. In fact it is targetting Indonesia. Here is related report on this matter. In fact i feel more comfortable with Indonesia than china as china business scene is bit different from what Haio is exceling in Malaysia, where its majority Malay driven MLM business is very successful. Indonesia is having a more similar environment than china and that's why i am optimisitic with its Indon's venture. Below is the announcement regarding this matter
Article entitled "Hai-O aims to strengthen Indonesian ops"
We refer to the news article, appearing in the New Straits Times, Biznews page
B6 on Thursday, October 29, 2009 in particular pertaining to the sentence
which is reproduced as follows :-
"Tan said the group is on track to achieve over 10 per cent growth in profit
and revenue for the current financial year ending April 30 2010, . "
The quoted statement is strictly an aspiration set to be achieved by the
Company after taking into consideration the Companys recent performance,
growing in the number of distributors in our multi level marketing division and
the ongoing sales promotion activities in plan. For the 1st quarter ended 31
July 2009, the Company had achieved financial performance with growth rate of
about 32% and 36% increase in revenue and profit after taxation respectively as
compared to the corresponding quarter of the preceding year.
The targeted revenue and profit to grow by 10% per cent this financial year is
an internal target set by the Company to achieve and not in any way intended to
refer to any financial estimates, forecasts or projections of the Company and
have not been reviewed by the external auditors of the Company.
The announcement is dated 29 October 2009.
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3 comments:
Cheah Wei,
What I heard now is to join as MLM members of Haio, one needs to pay RM20k, which includes membership fees and the goods. Hence, Haio can recognize the RM20k as revenue, so, the more agent to sign up, the better. I heard also that members are allowed to take loans for this RM20k. Hence, this may make the potential prospects to pay the RM20k using personal finance loan.
Hence, I think the party can go on for some more time.
However, the moment when Haio has lower dividend, that would be the time to be cautious.
Disclaimer: I also own Haio, but a very small portion only.
Giap Seng
i love Haio ;) i am confident to the management team... and the growth on indonesia. From the report, china will be the last in the region for Haio to go in the biz.
Should i do some technical analaysis instead? hehe...
thanks for the information Giap Seng :)
will the current announcement of the 50% increase in EPS, that translate to lower PE and potential increase in dividend. in addition, bonus issue of 1 to 5 (which roughly means a 20% return). although the action is dilutive, it is definitely no brainer to hold and earn from it over long term
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