Maybank.. a laughing stock?

National bank in Malaysia, Maybank buying Bank of International Indonesia (BII)... a news that caused maybank stock price to plunge since the news starts spreading through insider to investors... What logic would it be that when all other banks have withdrawn their bid but Maybank still pays more than 4.5 times book value of BII??... Is there any reason behind this transaction that public(tax payers) is not aware of?

First of all, in the short run (3-5 years) Maybank will reap nothing but continue to pump in cash into this blood sucker in the first few years... having paid so much to Temasek (~RM2.63bil)... what does Maybank stands to get in return? this is an insult to Malaysian if the management of Maybank were to say that BII is worth that much.... even the attempt of buying Public bank at 4.5 times its book value deserve grave consideration....

The way I look at this, it's nothing but a "negotiated" move... someone has gotten their shares so it's just paying what they have taken.... from business point of view, it's a lousy move... if they do their homework, this is definitely not an option to go.... pure stupidity from business standpoint.

Is genting fairly priced?

Genting is spending lots of money on the Singapore casino project and would only start to reap from it by end of 2010....will this giant be a good buy at current price below RM5.95? If the market is efficient, neither technical analysis nor fundamental analysis would be meaningful as none of them would be of any advantage to investors.... identifying systematic mispricing is impossible, any information on earning prospect and dividend is worthless, even insider info might be of little use if market is of strong efficiency...

i personally think malaysian market is a strong market, given the fact that insider trading is rampant... and our SC is just a white elephant... regardless, there will be exception and historical trend will continue to emerge and repeat itself...

Now back to Genting, believe I'm seeing a positive divergence in the making... and thought anything below RM5.75 is a good deal. The company’s plantation together with it’s oil and gas exposure also gives this company the best of both worlds now that the oil price stands at a staggering USD135 per barrel.

Ranhill

This stock has been losing steam since Jan this year and current stood at around RM1.50. The possibility of the pipe line project located in the northern region is likely to be a long shot now that all the states involved are control by opposition parties. Truth is even if the government is controling these states, it would not have take off easily let alone the situation Malaysia is currently in.

The Ranhill is therefore likely not to benefit from this "project" in the future given the uncertainty of the policy lead by the fed government. Without this project Ranhill still have plenty of project on hand to keep them busy for the next 5 years. Given the company's historically strong operating margin of ~30%, well diversified business and strong income from it's utility business makes it worth for you to keep this company in your radar.

I do not rule out possibility of privatization yet... ;)

What next?....

Many people has started to question the Malaysian market these days ever since the ruling government lost 4 of its the important states in the peninsular.

Question such as will the NCER, SJER, ECER and other major projects such as the 2nd Penang bridge in Penang state and other government enforced contract such as the the PGCC.

Well first of all, in my opinion the PGCC is doom.... it will never materialize. Realistically, it is not fit for implementation... PORR is another project poised to be scrapped....property buyers in Malaysia, becareful before you sign up for any new property... for you may end up holding it for a very long time...

Mortgage crisis is ending, oil price is hogging the lime light for now... >USD120 a barrel is just obscene...for a limited resource, those suppliers surely know how to squeeze the world consumers dry... credit crisis is not gonna end as quickly as some of us wanted it to be.... it's just gonna get tougher from here on... financial crisis from credit card spending is inevitable... one after another, the world just have to ride this one out... inflation is already here... the question is when it will recover?... banking sector is facing an uphill task in keeping up with the rising expectation of skeptical investors hoping for capital return on their investments...

Shortages of building materials is stifling the construction industry and for a house that needs RM250k to build from scratch a year ago, now needs ~300k on average across the country....

the fed gov has got to do better than this... projects announced in the 9mp have to be continued and supported from all angles to ensure that promises are kept....

US economy is reaping the bad seeds planted since the time Greenspan is in office and Bernanke is just clean up mess... US dollar is not going to recover its value unless they end the Iraq war and stay quietly at home building the new foundation for the country's economy going forward...

China market has retreated quite a big chunk in view of the nearing Olympics...Shanghai stock exchange will be hovering around 4k come the next 6 months... I expect nothing interesting... rather Singapore stock market is one of the best location to invest in for now in view of the good corporate governance and stability of the country in the Asian region....

For traders, I anticipate the Malaysian market will not have any major movement until the UMNO general assembly meeting draws nearer...so if you have been actively trading for quite a while, take a break la... what's the rush?... you won't lose much.... :)