When you have nothing to do, read books!

As the market going higher, it is getting tougher to find undervalue stocks. For the time being, I would try to gain more knowledge by reading more books.
For those who thinks that books are expensive, you can try to visit BookXcess (Amcorp Mall). You could get at least 50% cheaper than those found in other bookstore. The only downside is that the choice is limited. Recently, they moved to a larger store which is much more comfortable and significant increase of books selection as well.
Before visiting their store, you could check those title available through their website.

                     I purchased this hardcover book for only RM24.50.

I learned the hard and expensive lesson of going to sharemarket without any knowledge. Please do not follow my footsteps. Instead of paying the expensive 'tuition' fees, you could purchase tons of books for your own knowledge.
Even if you think that those books are worthless, at least you have tons of paper to burn rather than few pieces of worthless Contract Note. :)

Palm Oil - Basic Information

When we look into the reports/news/website of palm oil plantation companies, we come across of terms like Fresh Fruit Bunch (FFB), Crude Palm Oil (CPO) and Palm Kernel (PK). They will even produce their monthly production statement for FFB, CPO and PK from the example below taken from IOI Corp website.

                                            Source: IOI Corp website

FFB, CPO and PK

                                          Source: FAO Documents

The photos above are self-explanatory of the terms FFB, CPO and PK. Basically, Palm Oil will be extracted from the mesocarp (pulp) while Palm Kernel oil will be extracted from the kernel. The difference between both types of oil is that Palm oil normally used as cooking oil, while, Palm kernel oil mainly used for soap manufacturing. The prices for both Palm Oil and Palm Kernel Oil are different as well, though they have direct correlation.

                                           Source: MPOB website

The point to note is that some companies do directly sell part of the FFB produced to third party instead of processing it themselves.

                                            Source: TDM AR2008

Hope this is informative for the readers.

Dissecting TDM Bhd

Earnings

TDM Bhd net profit still largely depended on Plantation Division which mean their earnings still depended much on the Crude Palm Oil (CPO) price and Fresh Fruit Bunch (FFB) production. Please do not mistaken the FFB with CPO though. I will post some palm oil information in my next post.

Shareholders

                                                Source: TDM AR2008

As you can see from the list above, almost 70% of the share been tightly held by the state government ,thus, explaining the low daily volume of this share.

For all the readers, this is not a buy or sell call. Please exercise your own judgment or seek advise from your investment adviser.
I shall not be held liable if your share become like this...

or like this

                                       
Enjoy your weekend! :)

TDM Bhd - Dividends Don't Lie?

TDM Bhd (Current Price RM1.85) which involve in Plantation and Healthcare business declared a final dividends of 4 sen per ordinary share less 25% and 9 sen per ordinary share tax-exempted which still subject to Board approvals.
Just for information, TDM have a dividend policy statement of paying out at least 30% of its consolidated annual net profit which was approved on 12th April 2009. (you can refer to TDM website).
I am firm believer of Dividends Don’t Lie, but it should not be the only yardstick of stock selection. Understanding the business, balance sheet and their earnings should remain the main priority.

Some comments on this company by the readers for reference.

Healthcare business

Source: Data from KPJ AR2008

 Source: Data from TDM website and Q409 report

Source: TDM Q409 report

Not for comparison between both companies but to show the increase percentage of number of patients year-on-year.

I would like to add in the chart of healthcare cost in Malaysia but not able to locate it thus far. Please email to me if you have any for me to upload it.

Meaning of Deferred Revenue

Have you come across the term 'deferred revenue' in liabilities column of a company's balance sheet?
Here is the meaning,

What Does Deferred Revenue Mean?
A liability account used to collect deposits and other cash receipts prior to the completion of the sale. 

Investopedia explains Deferred Revenue
Deferred revenue is important because it's the money a company collects before it actually delivers a product. For example, a software company sells and receives payment for a computer program before it gets delivered or installed. This doesn't get recorded as straight revenue because, if something goes wrong with the job, the money is at risk.

Source: Investopedia.com

If you have any terms that you do not understand, you can almost able to look for it in Investopedia (Great site)

KJMC and TDM Bhd

Anyone who pass through Kelana Jaya via LDP should notice that there is one community hospital situated at the side of the highway called Kelana Jaya Medical Centre (KJMC). As I am visiting my friend today, I found out that KJMC actually belongs to a Public Listed company called TDM Bhd.
A check on the website of the TDM Bhd shows that the company actually having core business in Plantation and Healthcare. A quick glance through its latest quarterly report reveals that the earning is impressive and a healthy Balance Sheet. Need some time to digest the reports and get more information on this company. Keep in view.