Bursa: Moving Bullishly Upward

I have taken this article from the On-line STAR. It is written by Fintan Ng and Yvonne Tan.If you are closely monitoring the market or getting more involved in it, this is a good piece to read to get a broad feel of the possibilities of the Bursar sustaining its rise or otherwise.

" The local bourse’s benchmark FTSE Bursa Malaysia KL Composite Index (FBM KLCI) continued to chart highs that were last seen on the eve of the global financial crisis in early 2008 when it closed 0.44% higher at 1,526.53 yesterday, surpassing the 1,524.69 achieved on Jan 14, 2008.

Among the companies that helped boost the index were Malayan Banking Bhd, CIMB Group Bhd and telecommunications stocks such as Maxis Communications Bhd and DiGi.Com Bhd.

But can the market’s strong surge be sustained?

Analysts said that since the pace of economic growth had slowed in G3 economies – the United States, the European Union and Japan – with the outlook for the forseeable future continuing to look unexciting, investors were now looking to other markets and asset classes to place their money.

Tuesday's close

 

Year-to-date, several Asian markets including Indonesia and the Philippines have broken passed their record levels while the FBM KLCI has risen more than 20% since the beginning of the year.

Besides emerging-market equities, commodities have also seen their prices go up.

Spot gold surged to an all-time intra-day high of US$1,414.85 an ounce in London trade while crude oil has risen to near US$87 per barrel.

HwangDBS Investment Management Bhd chief investment officer David Ng said at a briefing yesterday that the local market could very well experience the bullrun of the early nineties when stocks were traded up to 30 times price-to-earnings ratio largely as a result of all the cheap money.

Monday's close

 

He said that Asian emerging markets’ fundamentals such as positive demographics, young population, urbanisation and rising middle class would continue to drive domestic demand.

Ng said the “sweetest place” to park money was in this region as the liquidity created by accommodative monetary policies in developed economies chased higher returns in this part of the world.

However, Morgan Stanley Research analyst Gerard Minack said in a Nov 5 report that there seemed to be a disconnect between the markets and the macroeconomic outlook.

He said what was not clear was whether the US Federal Reserve’s US$600bil plan to purchase government bonds over the next eight months to boost economic growth would work fast enough to significantly reduce recession risk.

Minack asked how long could markets run on the Fed’s latest stimulus without confirmation from macro data that things were improving.

“I’d characterise the macro data as mixed over the past month or so. More telling was the upside-down reaction to incoming news.

“For example, equity markets rallied after the weak September US non-farm payroll report because bad data meant more stimulus,” he said.

Minack pointed out that the S&P 500 finished lower after the stronger-than-expected Institute for Supply Management’s manufacturing index was revealed.

“It’ll be important when markets return to a good-news-is-good or bad-is-bad behaviour,” he said.

ECM Libra Investment Bank Bhd research head Bernard Ching told StarBiz that the Fed’s quantitative easing would merely stabilise developed economies and prevent them from spiralling into a double dip or deflation.

“The stimulus will not be able to change the outlook on US growth seeing as the jobs lost to-date will take six or seven years to replace,” he said.

As a consequence, Ching did not see demand picking up in the G3 economies as debt levels were high and consumption was “tepid”.

Meanwhile, UOB KayHian (M) Holdings Sdn Bhd research head Vincent Khoo said emerging markets,
including Malaysia, would continue to have a positive near-term market outlook until inflationary pressure brought on by the rise of commodity prices reversed the low-interest rate regime.

“The near-term market outlook will be positive, at least through the next few months, but if the threat of inflation is higher, central banks may be less accommodating,” he said.

Khoo cautioned that crude oil price reaching US$100 a barrel would cause some worries.
“Commodity prices just need to be carefully monitored to gauge for inflation,” he added.

KFC Off-Shore

For those following my earlier post on KFC, here are more tidbits of information.

For India, there are now 3 outlets in operation.

On the planning board, KFC expects to have 17 outlets in the subcontinent by the end of next year.

They opened the first at Pune and now they have two in Mumbai.

According to a KFC spokesperson, of the 17 outlets, five would be in Mumbai and these will all be acquired from master franchise holder Yum! Brands Inc. KFC will acquire two outlets in Pune from another Indian franchise holder, Kernel Food Pte Ltd.

Ali said KFC Holdings would open four more outlets of its own by year-end. Of the four, two would be in Mumbai, one in Pune and one in Aurangabad – all these cities are located in the state of Maharashtra, which is on the western part of India.

“We want to build a critical mass as soon as possible. By the end of this year, we will have a total of nine outlets which will involve an investment of about US$9mil,” he said.

He added that KFC Holdings would open eight outlets next year costing a total of US$10mil.

KFC expects a 15% yearly return to investment from the Indian operations. 

Maharashtra has a population of about 100 million, of which 21 million lives in its industrial and financial hub Mumbai and 5.7 million in its education-cum cultural centre Pune.

The Indian consumer market is also considered to be under-developed, having an estimated 1,200 brand restaurants in a country with over 1.13 billion, of which 50% is under 25 years old.

The spokesperson is impressed with the sales recorded in India, saying it should be faster here than in Cambodia.

On whether the company would venture into poultry and chicken-breeding business to support its operations in India, he said: “We’ll do things one step at a time. Maybe we’ll do it in the long run.”

He said KFC Holdings would focus on Maharashtra before looking at other states in India. At the moment, the company is only allowed by YUM! to operate in Maharashtra.

KFC Holdings also announce that it would open six outlets in Cambodia in 2011, with each outlet expected to cost RM1mil. It now has seven in that country.

He also said the company would open a Pizza Hut outlet in Phnom Penh soon.

YTL-Biggest Non-GLC?

Hear ye! Hear ye!

YTL Corp has a hefty cash reserves of  RM10.8bil!

With this chunky treasure trove, it is little wonder that YTL Corp Bhd has emerged to be the largest non-government-linked company in this year’s Malaysian Business Magazine Top 100 Companies survey of Malaysia’s largest listed companies.

YTL Corp said the group moved up to No. 5 from No. 20 previously in the list of Malaysia’s largest listed companies while its subsidiary, YTL Power International Bhd, soared 23 rungs to secure the eighth spot.

With its cash reserves amounting to about RM10.8bil, analysts said YTL Corp could easily acquire assets up to US$25bil-US$30bil without the need to raise more money.

It had been reported that the group was looking at acquisition opportunities in the water utilities, power generation and cement businesses, especially in China where it wanted to grow its presence in cement and power generation.

YTL Corp said that riding on its long history and impeccable track record, the group’s portfolio of businesses had grown tremendously over the last decade and now spanned across Asia-Pacific and Europe.

This strategy had generated excellent returns for shareholders, successfully contributing to an annual average compounded growth rate of 55% over the last 15 years.

YTL is here to stay,my friends...........

Kentucky Turns Indian Juggernaut!

If there is any stock that you want to pick in the Bursa Malaysia, do consider KFC Holdings. It is definitely going places!

Feeling the density,intensity and competitiveness of the operations at home, KFC has trained its sights on the Indian sub-continent.

In October,after opeining close to 500 outlets in Malaysia, KFC opened its third branch in India in Mumbai again-right in the the hub of both entertainment and hi-finance. This is its second branch in Mumbai . It opened the first in June.

Both these outlets were opened on the heels of the opening of an outlet in the educational-cum-cultural hub of Pune which opened in April.

KFCH’s vision is to become the largest integrated food services group in the Asia-Pacific.

India is KFCH’s first venture outside South-East Asia. The company now has 75 outlets in Singapore, eight in Brunei and nine in Cambodia.

KFCH views India with great optimism because the world’s second-most-populous country offers sustainable business growth.

A KFC spokesperson says the Indian consumer market is considered underdeveloped, as it now has about 1,200 brand restaurants in a country with a population of about 1.13 billion.

There is a large consumer base in India, with its emerging middle-class driving consumption for food and entertainment, while 50% of the population are under 25 years old.

“KFCH stands to reap growth prospects for strong organic growth in India, with Mumbai and Pune having a combined population of about 26 million,” he said.

“We can emulate KFCH’s success of a fully integrated operation, delivering consistent support services, reliable source of quality chicken at competitive prices and most importantly, its ability to supply the growing demand for halal chicken,” he adds.

In India, KFCH sources it halal chicken from a local processing plant, Venky’s India Ltd.

The KFC spokeperson said that the Indian venture would also allow KFCH to diversify its earnings base besides reducing its dependency on the Malaysian and Singapore markets.

KFCH’s inroad into India was made possible following an offer from Yum! Brands Inc, the master franchisor of the KFC brand, to develop the franchise in the state of Maharashtra, where both Mumbai and Pune are located.

KFCH will focus on developing its chain of outlets in Maharashtra before looking at other states in India, noting that Maharashtra, which is on the west side of the subcontinent, offers vast opportunity with a population of about 100 million.

KFCH sees exciting times ahead in India. The company plans to have a total of 17 outlets by the end of next year, including five in Mumbai that it would acquire from Yum! Brands.

KFC does not rule out the possibility of KFCH acquiring the remaining KFC franchisees in Mumbai. Apart from the five KFC outlets to be acquired from Yum!, there are now four stores owned by three other franchisees in Mumbai.

“Mumbai and Pune will be our launch pad into India. We’re here to stay for the noble and collective good of all,” he says.

Mumbai Chicken Pte Ltd chief executive officer Hezal Ahmad says KFCH’s outlets in India would be targeted mainly at the youth market. Mumbai Chicken is a member of KFCH.

He says it will also cater mainly to the high-income population which offers better profit margin.

KFCH has maintained its existing KFC image in its outlets in India. However, the interior of the restaurants has been designed to give the right ambience for the youth.

Hezal says total poultry consumption in India is growing by about 5.5% a year while consumption per person rose to 2.1kg in 2008 from 1.4kg in 2003.

However, the 2.1kg consumption per person is still much lower than Malaysia’s which stood at 38kg in 2008.

“The modern lifestyle, increasing number of fast-food outlets, higher number of youngsters and the availability of processed chicken products in the market are boosting chicken consumption in India,” he says.

According to Hezal, KFCH outlets in India will be located mostly in shopping malls with cinemas so as to get nearer to its target market and to capture a bigger traffic.

For example, its first and only outlet in Pune so far is within the Deccan Mall, which is a prime zone for eating and surrounded by 13 colleges.

Pune, a city about four hours drive from Mumbai, is home to about 90 colleges.

With a population of some 5.7 million, of which two million are students, it offered a huge youth market for KFCH to tap.

Hezal says KFCH outlets in India serve vegetarian and non-vegetarian food. The company is developing more non-vegetarian food to add to its menu.

Currently, non-vegetarian food contributes 95% of sales while vegetarian food 5%.

All KFCH outlets in India are run by Indians. Last year, the company sent 14 people from India to be trained as restaurant managers at its Malaysian outlets.


Expect KFC to bring home the Indian harvest soon!

Say Goodbye to Jill

Jill Clayburgh, that glowy beauty of the silver screen has passed on yesterday at the age of 66.

Jill specialised in roles as independent women emerging from the shadows of men.She was nominated for best-actress Oscars for her role in Paul Mazursky’s “An Unmarried Woman” in 1978 and for the comedy “Starting Over” opposite Burt Reynolds a year later.

In “An Unmarried Woman,” Clayburgh played Erica, a comfortable Manhattan wife and mother whose world comes apart when her husband, without warning, abandons her for a younger woman.

By the final reel, she embarks on a relationship with an artist, played by Alan Bates, but also finds her own inner strength, voice and independence.

Clayburgh won the best actress prize at the Cannes Film Festival for her performance.

Her roles during the late 1970s and early 1980s reflected the changes and challenges facing many women during that time.

“I guess people look at me and they think I’m a ladylike character,” she told the Times in 1982. “But it’s not what I do best. I do best with characters who are coming apart at the seams.”

Clayburgh also appeared frequently on Broadway and television. She received Emmy nominations for her performance as a prostitute in the 1975 TV movie “Hustling” and in 2005 for her role in “Nip/Tuck.” She also appeared as the mother of the title character in the hit series “Ally McBeal.”

“Her final film, “Bridesmaids,” has not yet been released.

We say au revoir to Jill.

ONOMATOPOEIA

Some words in the English Language imitate or suggest the source of the sound that it describes; especially animal sounds. For example a duck quacks, a dog barks, a lion roars and a cat meows.

Similarly, many words have been created from sounds created by objects.

So, we say

1.      the babble of a stream

2.      the beat of a drum

3.      the booming of a gun

4.      the ring of a telephone

5.      the clink of a coin

6.      the dripping of water

7.      the gurgle of a stream

8.      the hissing of steam

9.      the howling of the wind

10.  the jangling of chains

11.  the jingle of coins

12.  the lapping of water

13.  the patter of feet

14.  the screeching of brakes

15.  the slam of a door

16.  the toot of a horn

17.  the whack of a cane

18.  the singing of a kettle

19.  the bubbling of water

20.  the crackling of wood

21.  the creak of a hinge

22.  the lash of a whip

23.  the twang of a bow

24.  the wail of a siren

Mr Nobody

For those who are attending Form 1 in 2011, why not read this simple poem and try out this quiz?

 

1.                  Who knows a funny little man?

a)                  The children

b)                  The persona

c)                  The cook

d)                  The gardener

2.                  Nobody knows his name, so they called him……..

a)                  Mr.No One

b)                  Mr. Nobody

c)                  Mr. Noname

d)                  Mr. Noperson

3.                  No one knows he is around as he is as quiet as a………..

a)                  grasshopper

b)                  mouse

c)                  lizard

d)                  cockroach

4.                  What does the word ‘mischief’ means?

a)                  to be a chief

b)                  up to no good

c)                  always misses

d)                  a lady chief

5.                  This unseen person is present in …….

a)                  somebody’s house

b)                  everybody’s house

c)                  no body’s house

d)                  someone’s house

6.                  What does Mr. Nobody do to books?

a)                  draws on them

b)                  tears them

c)                  writes on them

d)                  dirties them

7.                  What does the word, ‘ajar’ mean?

a)                  closed tightly

b)                  open at an angle

c)                  open wide

d)                  closed and locked

8.                  What does Mr Nodoby do to your shirts?

a)                  removes the collars

b)                  remove the buttons

c)                  remove the sleeves

d)                  remove the pockets

9.                  What does the word’ scatters’ mean?

a)                  throw in various directions

b)                  gather from all directions

c)                  throw in one direction

d)                  gather around

10.              Who was supposed to oil the door hinges?

a)                  the father

b)                  the son

c)                  the workman

d)                  Mr. Nobody

11.              What kind of wood did Mr. Nobody put on the fire?

a)                  old wood

b)                  wet wood

c)                  dry wood

d)                  damp wood

12.              What does ‘soil’ mean?

a)                  to fertilize

b)                  to dirty

c)                  to clean

d)                  to add earth

13.              What did Mr .Nobody did with the newspapers?

a)                  he tore them

b)                  he toss them around

c)                  he scatters them

d)                  he sold them

14.              What did Mr. Nobody left on the door?

a)                  handmarks

b)                  fingermarks

c)                  scratches

d)                  grafitti

15.              What will make the curtains fade?

a)                  if you leave the window open

b)                  if you leave the blinds unclosed

c)                  if you leave the curtains open

d)                  if you close the windows

16.              What footwear was left on the floor by Mr Nobody?

a)                  shoes

b)                  boots

c)                  slippers

d)                  socks

Wasn't that easy?