A Wonderful Company to Invest for the Long Term (Screen 4)

Chart of Revenue, PBT and EPS.over 13 years

Revenue = Red line
PBT = Green line
EPS = Blue line

Chart of EPS, High Price and Low Price over the last 13 years
EPS = Brown line
High Price = Blue line
Low Price = Purple line

GHI

This company is Topglove.

A Wonderful Company to Invest for the Long Term (Screen 3)

Chart of Revenue, PBT and EPS.over 13 years

Revenue = Red line
PBT = Green line
EPS = Blue line

Chart of EPS, High Price and Low Price over the last 13 years
EPS = Brown line
High Price = Blue line
Low Price = Purple line























EFG

This company is Maybank.

A Wonderful Company to Invest for the Long Term (Screen 2)

Chart of Revenue, PBT and EPS.over 13 years

Revenue = Red line
PBT = Green line
EPS = Blue line

Chart of EPS, High Price and Low Price over the last 13 years
EPS = Brown line
High Price = Blue line
Low Price = Purple line

























CDE


This company is Nestle.

A Wonderful Company to Invest for the Long Term (Screen 1)

Chart of Revenue, PBT and EPS.over 13 years

Revenue = Red line
PBT = Green line
EPS = Blue line

Chart of EPS, High Price and Low Price over the last 13 years
EPS = Brown line
High Price = Blue line
Low Price = Purple line



























ABC

Better Investing

A.  Analyse Growth

Step 1: Historical Sales

Historical sales growth is the first of four indicators BetterInvesting uses to identify well managed growth companies.

It is desirable to invest in companies whose sales growth is strong and consistent and generally growing faster than the overall economy and inflation combined. *

Is the company's historical sales growth rate acceptable for a company its size?
Check growth rate % - have sales grown faster than the competition and the economy?
Check growth rate trend - have sales figures changed direction recently? If sales are up or down do you know why? Are the forces that caused growth in the past the same ones that will create growth in the future?
Does the company deserve further study?

Compare your candidate company to:
Others in the same industry
Peer group average
Industry average

* Review background economic and inflation data
Gross Domestic Product Data
Inflation Data


Step 2: Historical Earnings Per Share

Historical earnings per share (EPS) growth is the second indicator BetterInvesting uses to identify well managed growth companies.

It is desirable to invest in companies whose EPS growth rate is strong and consistent and generally growing faster than the overall economy and inflation combined.

Is the company's historical EPS growth rate acceptable for a company its size?
Check growth rate % - have earnings grown faster than the competition and the economy?
Have EPS figures changed direction recently? If so, do you know why?
Does the company deserve further study?

Compare your candidate company to:
Others in the same industry
Peer group average
Industry average


Step 3: Historical Stock Price Review

You've reviewed the company's historical sales and earnings growth. Both should be growing
1. Faster than the economy and inflation combined
2. Faster than competitors
3. Consistently

If these conditions have been met then check that EPS is growing in line with sales.
1. Check that the graph lines of sales and EPS are mostly straight and moving together in parallel toward the upper right-hand portion of the graph.
2. Compare the growth rates of both sales and EPS using the rates given in the data grid.

Next, determine whether the company's stock price has tracked the growth rates of Sales and EPS. A company's stock price will typically follow the earnings growth rate -- price follows earnings. Looking at the graph you can see the relationship of stock price to EPS.

Steady growth in stock price is an indicator of management's ability to grow sales and EPS and that the market has confidence in the company.

It is desirable to invest in companies whose share price increases as its sales and earnings increase. Price bars show how much movement up and down there is in the stock price each year. Skilled management can control the variables in the company so that the high and low prices travel smoothly upward. More up and down movement means more risk.

Check
Are earnings growing in line with sales?
Has the company's stock price moved in line with EPS?
Does this company deserve further study?


B.  Evaluate Management

Step 1:  % Pre-Tax Profit on Sales

% Pre-tax Profit on Sales is the third indicator BetterInvesting uses to identify well managed growth companies. A good percent pre-tax profit margin shows a company is well managed.

It is desirable to invest in companies whose percent pre-tax profit is increasing or at least staying the same. Examining the most recent five year average helps us determine this.

Is the 5 year average percentage of pre-tax profit on sales increasing or at least staying the same?
Is the percentage of profit consistent over time?
Does this company deserve further study?

Compare your candidate company to

Others in the same industry
Peer group average
Industry average

Step 2:  % Earned on Equity

% Earned on Equity (ROE) is the fourth indicator BetterInvesting uses to identify well managed growth companies. It tells how effectively company management is using the shareholders' money to make a profit.

It is desirable to invest in companies whose ROE percentage is increasing or at least staying the same. An exception is when a company is paying off debt, which is covered in the next section.

Is the percentage of ROE increasing or at least staying the same?
Is the percentage of ROE consistent over time?
Does this company deserve further study?

Compare your candidate company to
Others in the same industry
Peer group average
Industry average


Step 3:  Total Debt

One indicator of management skill is how debt is employed.

Most companies borrow money to help them reach their goals. Companies go into debt to buy equipment, real estate, and many other things. Some industries use debt more than others. Borrowing some money can be very good because it helps the company do things it could not afford to do on an all cash basis. Borrowing too much money can be very bad because it increases risk in two ways:

1. Debt increases the risk to common shareholders because the company must pay the claims from debt and preferred stockholders before common shareholders receive anything.

2. High levels of debt are risky for a company because it has to pay its debt obligations whether it's doing well or not. If the company runs short of money during a recession, the debt obligations could force the company to go out of business.

Check:

Is the total debt increasing or decreasing?
Review the company web site and official reports to understand the reasons for significant changes in total debt.

Look at Total Debt and % Debt to Capital together to understand how the company is managing debt.

Step 4:  % Debt to Capital

One indicator of management skill is how debt is employed. Look at Total Debt and % Debt to Capital together to understand how the company is managing debt.

The percent of total debt to capital helps you understand whether company management is using debt conservatively or liberally. The ratio enables you to make valuable comparisons between the company you are studying, peer companies and the industry.

Some industries such as banks, financial institutions, and utilities typically operate using higher levels of debt. Some successful companies in other industries have proven that they can carry high debt over many years. Younger companies often have relatively higher levels of debt, but because they are young they don't have a track record that shows they can manage it well over many years. This adds considerable risk as an investment.

Check:

Is percent of Debt to Capital increasing or decreasing markedly?
Review the company web site and official documents to understand the reasons for changes in debt levels (company expansion, acquisitions, divestiture, etc.)
Is the company on a "spending spree" financed by debt?
Is the company borrowing enough to help it stay competitive?

Compare to:
Historical trends
Peer Group
Industry averages


C.  Forecast Sales Earnings

Step 1:  Forecast Sales

If the company you are studying has not met any of the BetterInvesting standards you have studied so far, you should discard the company and begin the study of another.

If all preceding indicators have met the BetterInvesting standards then you have more than likely identified a quality growth company. You now need to consider its potential as an investment for your portfolio.

You must predict how well your investment candidate will perform in the future by estimating sales and earnings.

First, forecast the rate at which you believe sales will continue to grow in the future.

Forecast company sales by considering:

1. Historical results -- consistent strong growth
2. Competition
3. Changes in consumer or market preferences
4. Changes in products or services offered

Is your forecast moderate, meaning it does not rely on extreme conditions or situations?
Is your forecast sustainable, meaning it does not rely on events or circumstances that are not likely to occur regularly?
How does it compare to other companies you may have studied?


Step 2:  Forecast Earnings

Forecast the rate you believe earnings will grow in the future. Your forecasted earnings growth rate will establish an estimate of how much money the company will be earning per share five years from now. This EPS forecast will help you establish an estimated high price the EPS would support.



D.  Assess Risk and Reward

Step 1:  Forecast High Price

How high is the price of the stock likely to go in the next five years?

The answer comes by multiplying the highest likely earnings per share by the average high price earnings ratio.

1. The default high EPS forecast is determined by your entries in the preceding screen.

2. The average high PE forecast is determined by reviewing historical data and current PE primarily, and competitive information as well.

Changing the numbers in the boxes changes the forecast.


Step 2:  Forecast Low Price

How low is the price of the stock likely to go in the next five years?

The answer comes by multiplying the lowest likely earnings per share by the likely average low price earnings ratio.

The default values displayed are based on historical averages.

You need to decide whether or not they reflect the company in the next five years and adjust if necessary.

Step 3:  Assess Stock Price

Now that you have estimated the high and low prices for the next five years, find the current price and determine where it falls within the high-low range.

The range between the high and low prices is divided into three zones: sell, hold and buy.

1. If the current price is in the top range, the stock is in the sell range.

2. If the current price is in the middle range, the stock is in the hold range.

3. If the current price is in the lower range, the stock is in the buying range.

Step 4:  Determine Potential Gain vs. Loss

Even though well considered, forecasts are not certain.

By comparing the current price to

1. Your forecast high price and
2. Your forecast low price

you determine your potential gain and potential loss.

It is desirable to invest in companies offering a potential gain at least three times the potential loss.


E.  Determine 5 Year Potential

Determine 5 Year Potential

Compounded Return is the projected annual price appreciation plus the projected average annual yield.

The Price Appreciation is the increase in the price of the stock, assuming you sold the stock at its projected high price.

The Yield is the projected average annual return on the price, paid as a dividend. Yield is calculated by dividing the dividend by the purchase price of the stock.

If the company performs as well as you expect, and you sell the stock at the forecast high price, this will be your financial return.





Better Investing - Core SSG
http://www.betterinvesting.org/public/default.htm

http://www.betterinvesting.org/NR/rdonlyres/CB93E207-7341-4225-B609-8197173DFBB9/0/P1JudgmentandtheSSG4pp.pdf

http://www.betterinvesting.org/Public/SingleTabs/Webinars/archives.htm


Stock Research Form

4.0 CONCLUDING DIALOGUE (STOCK SELECTION REPORT)

To complete, make selections from choices presented in each statement below.

1.       The company is (well-established) (new) and operates (internationally) (nationally) (regionally).

2.       The product line or service is (diversified) (limited) and sold to (consumers) (manufacturers) (other companies) (government(s)).

3.       Business cycles affect sales and earnings (minimally) (moderately) (severely).

4.       Interest rates for T-bills are historically (low) (average) (high) and seem to be (trending upward) (steady) (trending downward).

5.       Current inflation rates are (low) (average) (high) and seem to be (trending upward) (steady) (trending downward).

6.       In its industry the company is the (largest player) (in the top tier) (an average or smaller size company).

7.       The company has a (continuous dividend record for ________ years) (an inconsistent dividend record) (no dividend record).

8.       The business cycle seems to be (trending upward) (steady) (trending downward).

9.       The current stage of the business cycle tends to (help) (not effect) (hurt) the profits of the company which suggests (no concern) (caution) (optimism) for the company under review.

4.1 YOUR PROJECTIONS ON THE SSG (SUMMARY)
	Projection	Rationale
Sales Growth Rate (%)
EPS Growth Rate (%)
High P/E
Low P/E
Low Price
% Payout
4.2 YOUR FINAL RECOMMENDATION (BUY, SELL, HOLD)

When to Sell?

Selling “Myths”
• MYTH – Once a stock has doubled our investment it is time to sell.
• MYTH – Wait until a stock is back to even before selling.
• MYTH – Sell if the stock price falls 10% (or some other %) below the
purchase price.
• MYTH – Only sell when your SSG says “Sell.”
• MYTH – If a company is meeting our growth expectations, then do
not sell.
• MYTH – Don’t sell a stock until you have found a good replacement.
• MYTH – Sell everything when we are going into a bear market.
• MYTH – Don’t sell because it’s a “good company.”

Valid Reasons to Sell
• When something is truly wrong with the
business and it won’t likely be fixed within a
year
• When the stock price has risen so much that
future gains are unlikely.
• When you find a better stock. Frequently this is
a back‐door way of exiting a weak holding.

How can you become a better seller?
•Write it down – have written rules for selling just like you do
when buying
•For an investment club – rotate stock assignments so one person
isn’t identified with “her” or “his” stock
•Remember, stocks are a means to an end. The goal is to grow
your wealth. You aren’t being disloyal to a stock if you sell it.

http://www.betterinvesting.org/NR/rdonlyres/12386A1B-284F-4E75-B02C-D9396B363B26/0/StockUpFeb2015Slides4pp.pdf

Breaking the Slow-Growth Myth of Consumer Staple Companies

By Stanley Lim Peir Shenq, CFA - March 29, 2016 

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Some investors think that consumer staple companies are slow-growing, lumbering companies whose stocks do not provide much opportunity for high capital gains. They may be wildly mistaken.

To show why that’s so, let’s take a look at two large consumer staple companies that are listed in Singapore and Malaysia. They are Thai Beverage Company Limited (SGX:Y92)and Nestle (Malaysia) Berhad (KLSE:4707.KL).

Thai Beverage produces and distributes alcoholic beverages, non-alcoholic beverages, and snacks mainly in Thailand. Nestle (Malaysia), on the other hand, is a food and beverage conglomerate that sources the bulk of its revenue from Malaysia.

If you had invested in either of them over the past 10 years, you would have at leastquadrupled your money as the following table makes clear.

Source: S&P Global Market Intelligence

More importantly, the duo’s stock market returns have been backed by solid growth in their underlying businesses as well. You can see this in the table below:

Source: S&P Global Market Intelligence

A company would see its profit more than double over 10 years if its profit is growing at a CAGR of 8.0%; both Thai Beverage and Nestle (Malaysia) have bottom-lines which had climbed at rates faster than 8.0% per year.

Investors who have the impression that consumer staple companies are a bunch of slow-growing and boring companies may want to rethink that assumption. If a tripling of my investment every 10 years is considered boring, I can seriously live with that.

https://www.fool.sg/2016/03/29/breaking-the-slow-growth-myth-of-consumer-staple-companies/

Investing overseas: What you need to know

Saturday, 26 March 2016

BY YAP MING HIU MONEYandYOU

WITH the ringgit weakening over the past year or so, those of you who haven’t already, are probably starting to toy with the idea of investing overseas.

Diversification across markets, asset classes and currencies is one of the basic tenets of investing. Those who follow this strategy religiously would likely have seen their investment portfolios perform better than those who remained entrenched in the local market.

What used to be considered fairly robust returns – such as ASB dividends of 8% per annum and EPF dividends of 6.5% per annum – now seem menial if you take into account the 30% drop in the value of our ringgit.

It is no surprise then that by now, many Malaysians have accepted the fact that the ringgit may not bounce back to RM3.20 to US$1 anytime soon, and that it is time to diversify their assets by means of foreign investments.

This is good. But before putting your money into foreign investments, you need to know what you are getting yourself into, and carefully consider your decisions before making your moves.

Firstly, how much of your investable assets should you allocate to foreign investments?

The rule of thumb is to allocate not more than 30% of your investable assets into foreign currency investments. The reason for this is that your daily life still revolves around the Malaysian currency, and your foreign investment is merely a means of bolstering your net worth.

Besides, if the US currency weakens, you run the risk of losing a significant amount of money if your primary invested assets were in US dollars. In recent months, anyone who bought into the pessimistic view out of fear that the ringgit would touch RM5 to US$1 would have seen the value of their foreign investment shrink owing to the strengthening of the Malaysian currency. Therefore, putting more than 30% of investable assets into foreign investments would be over-investing, not to mention highly risky.

The second point to consider is, how do foreign investment markets fare in comparison to Malaysia?

If you have not had any experience investing overseas, you may be in for a big surprise. Many Malaysians assume that the investment market overseas works more or less the same way as it does locally. However, this is not the case.

Unlike Malaysia, foreign investment markets such as US, Singapore and Hong Kong are far more open and have fewer regulatory restrictions. There’s also less government support for their market. As such, while these markets enjoy higher levels of global portfolio fund flows, they also experience higher levels of volatility and price fluctuations.

Let us take the example of bonds. In Malaysia, bond investments behave almost like a fixed deposit type of investment – steadily up and predictable (partly due to the accreting value of bond coupons recognised by the fund over time). However, the same can’t be said in other countries.

In the graph, you can see that a Malaysian bond fund (Fund A) moved up steadily over the period of comparison whereas the US (Fund B) and European (Fund C) bond funds experienced higher levels of price volatility and underperformed Fund A. All three funds invest in somewhat similar investment grade papers, only that they invest in different markets. This is mind blowing for most Malaysian investors.

In fact, I had a client who once lost up to 20% of his investment in an Asian bond fund domiciled in Singapore. What made him very upset was that he wasn’t properly advised by the banker of the risk exposure of such a fund. Had he done a little more due diligence or consulted an independent financial advisor before investing into the fund, he would not have been caught off-guard and suffered such a significant loss.

The same applies to equity investment overseas. Many investors would have a hard time trying to adapt to markets that are more volatile than our FTSE Bursa Malaysia KL Composite Index.

The next point to consider is this: How safe is your capital when investing in foreign products? If things are not going well, will you be able to retain your capital at the least?

Let me highlight the example of an offshore commodity product that I once came across. This product focused on physical trading of commodities like timber, metals, aquaculture, rice, plant-based oil, crude oil and biofuel. It supposedly had an attractive track record, yielding double-digit annualised returns for more than two years since its inception. It targets to provide investors with a fixed 2.25% quarterly distribution (i.e. a total of 9% per year).

One of the most common mistakes made by Malaysian investors, however, is the tendency to look at foreign investments through the lenses of their local perspective and experience. At first glance, you might think this investment is no different than any other equity unit trust funds available in Malaysia – a credible alternative investment with good diversification credentials worthy of consideration.

However, the product turned out to be a scam and the investors lost all their money. This is not an isolated case. Due to their limited knowledge and experience, many Malaysian investors fail to differentiate genuine investments from scams. That costs them a lot of money.

Cashflow needs

Thus when investing in foreign markets, it is always better to stick to licensed and reputable fund managers that invest in regulated investments and markets. Lastly, before putting your money into foreign investments, you should thoroughly assess your cashflow needs in order to maximise the holding power of your investments.

A good cashflow management practice is to establish one’s ideal cash reserve before dabbling in investments. For working adults, this emergency fund should be able to cover six months of one’s cashflow needs such as living expenses, loan repayments and any other lump sum cash requirements over the next three years. I recall an incident where a client of mine underestimated the amount of cash he would need to execute his plans of building a bungalow on a plot of land he owned.

Only midway through the construction process did he realise that he was short of cash, after having invested the remainder of his liquid assets in foreign investments. In the end, in order to complete his dream home, he was forced to withdraw his foreign investments at a loss.

A situation like this could have been easily avoided with a little bit more cashflow planning and foresight. Make the necessary provisions for your short-term cashflow needs and you will position yourself to better withstand any unexpected investment market volatility.

Diversification of investments across markets, asset classes and currencies is a recommended risk management strategy for any investor and should be diligently pursued. However, never assume that investing overseas is similar to investing in your home ground. In the case of Malaysia’s relatively stable investment environment, entering into foreign investment markets could be akin to stepping into rough sea from a calm bay – it might come as a shock if you are unprepared.

Conduct your research thoroughly – find out more about the investment environment, the country’s regulations, and study the investment product carefully. Consult a professional if required, such as an independent financial advisor, to address any concerns you may have. Once you’ve considered the above and decided to invest, make sure that you monitor the performance of your investment closely.

The more volatile a market, the faster you’ll need to take action on your profits or losses. Park your profits somewhere safe to prevent losing it to the fluctuating market. If your investment is making a loss, then act fast with a contingency plan at hand.

Remember, the more prepared you are, the more likely you are to succeed. All the best!

Yap Ming Hui (yapmh@whitman.com.my) is a bestselling author, TV personality, columnist and coach on money optimisation. He heads Whitman Independent Advisors, a licensed independent financial advisory firm. For more information, please visit his website at www.whitman.com.my

Bank Negara Malaysia 2015 Annual Report

http://www.bnm.gov.my/files/publication/ar/en/2015/BNMAR2015_slides.pdf

http://www.bnm.gov.my/files/publication/ar/en/2015/ar2015_en.pdf

Outlook for the Malaysian Economy in 2016 

The international economic and financial landscape is likely to remain challenging in 2016 and will be a key factor that will influence the prospects of the Malaysian economy. Depending on their nature, global developments can pose both upside and downside risks to the Malaysian economic growth. The Malaysian economy is expected to grow by 4.0 – 4.5% in 2016. Domestic demand will continue to be the principal driver of growth, sustained primarily by private sector spending. Private consumption growth is expected to trend below its long-term average, reflecting largely the continued household adjustments to an environment of higher prices and greater uncertainties. These moderating effects, however, will be partially offset by continued growth in income and employment, as well as some support from Government measures targeted at enhancing households’ disposable income. In an environment of prolonged uncertainties and cautious business sentiments, private sector investment growth is projected to be slower compared to its performance in the past five years. Capital expenditure in the upstream mining sector will continue to be affected by the environment of low energy and commodity prices. Support to private sector capital spending will mainly stem from the implementation of on-going and new investment projects, particularly in the manufacturing and services sectors.

 Reflecting the Government’s commitment to more prudent spending, growth of public sector expenditure is also expected to be more moderate but would continue to be supportive of overall growth. Public investment is, however, projected to turn around to register a positive growth, reflecting higher spending by the Federal Government on fixed assets and the continued implementation of key infrastructure projects by public corporations. The external sector is expected to remain resilient in 2016. Despite subdued commodity prices, Malaysia’s export performance is projected to remain positive, in line with the modest improvement in external demand. The well diversified nature of Malaysia’s exports will continue to support the overall growth in exports. Gross imports are projected to expand further amid an increase in intermediate imports to support the sustained performance of manufactured exports and the higher growth in capital imports due to continued expansion in domestic private investment. The overall trade balance in 2016 is expected to continue to record a surplus, albeit one that is smaller. The services account is projected to record a narrower deficit on account of an expected improvement in tourism activity. Overall, the current account surplus is projected to narrow further to 1.0 – 2.0% of gross national income (GNI). On the supply side, all economic sectors are projected to expand, albeit at a more moderate pace in 2016. The services and manufacturing sectors will remain the key drivers of overall growth. Despite the lower oil and gas prices, growth in the mining sector will be supported by new gas production capacity. Growth momentum in the construction sector is projected to moderate slightly in 2016 amid a modest expansion in both the residential and non-residential sub-sectors. Headline inflation is projected to be higher at 2.5 – 3.5% in 2016 (2015: 2.1%), due mainly to increases in the prices of several price-administered items and the weak ringgit exchange rate. However, the impact of these cost factors on inflation will be mitigated by the low global energy and commodity prices, generally subdued global inflation and more moderate domestic demand. The trajectory of inflation during the year, however, could be more volatile given the uncertainties relating to global oil and commodity prices as well as the pace of global growth.


Economic and Monetary Management in 2016 

Monetary policy in 2016 will focus on ensuring that monetary conditions remain supportive of sustainable domestic growth with price stability, taking into consideration the evolving risks in the external and domestic environments. In particular, global economic and financial developments will need to be closely monitored and assessed in terms of their implications for the domestic growth and inflation outlook. Monetary policy will also continue to take into account the risk of financial imbalances. In addition, given the expectation of continued volatility in external flows, the Bank’s monetary operations will be directed towards ensuring that domestic liquidity in the financial system will remain sufficient to support the orderly functioning of the domestic financial markets. Fiscal policy in 2016 will continue to focus on fiscal consolidation. The 2016 Budget was recalibrated in January 2016 to incorporate the expected decline in global oil prices. 
Government spending was reprioritised and measures were introduced to broaden revenue sources. Fiscal spending will be prioritised towards high impact infrastructure projects that could have large multiplier effects by increasing the productive capacity of the economy. In addition, emphasis will continue to be accorded towards ensuring inclusive and sustainable growth through welfare enhancements, particularly in the form of socio-economic support to the lower- and middle-income segments to help them cope with the rising cost of living. Given the expectation of a challenging global financial environment, Malaysia will likely be confronted by volatile movements in capital flows. However, Malaysia’s deep and developed financial markets are well-positioned to intermediate these flows, thus ensuring that the functioning of the domestic financial markets will continue to be orderly and supportive of the real economy. Malaysia’s ability to withstand external shocks will also be augmented by its ample buffers and robust policy frameworks that have been steadily built over time. 

UK student property getting popular in Malaysia

March 18, 2016, Friday

London Spring Place is a new purpose-built student housing project comprising 386 fully managed en-suite rooms and self-contained studio suites.

KUALA LUMPUR: Cornerstone International Properties has launched the second phase of the London Spring Place (LSP) project in Malaysia following the sell-out launch of Phase 1 in Malaysia in 2015. London Spring Place is a purpose built student accommodation in the UK.

In a press statement to The Borneo Post yesterday, it stated that Phase 1 of LSP, which sold out within months, was a runaway success in Malaysia, a sign that more Malaysians are seeing the viability and benefit of investing in UK student property, especially in light of the ringgit volatility and local and global economic uncertainty.

“Traditionally reserved for institutional investors, UK student property is now open to individual and private investors and has grown in popularity in Malaysia,” said Cornerstone International Properties director Virata Thaivasigamony.

“We are firm believers in this investment type as it has proven to be recession-proof and the strongest performing asset class in the UK with annual nett yields as high as 8 per cent, superseding the meagre 4 per cent and 2.5 per cent gross yields from residential rental projects in Kuala Lumpur and London, respectively,” said Virata, citing Felda’s investment in a student property in the UK in 2015 in a move to diversify assets.

“We saw a sharp increase in our UK student property sales numbers compared to residential property in Malaysia. In 2015 alone, 73 per cent of our inventory sold to Malaysians was UK student property. Our top-selling student property project, London Spring Place (Phase 1) which was extremely popular among Malaysian investors, sold out last year.

“In fact, Cornerstone International Properties sold an impressive 80 student units for the developer of London Spring Place alone! We just launched Phase 2 early this month and the take up rate has been extremely positive.”

Cornerstone International Properties is the exclusive marketing agent for LSP in Malaysia. LSP units come furnished with a fully equipped gym, cinema room, communal study and games rooms, onsite laundry, and high-speed WiFi in every room.

The popularity of UK student property is largely attributed to its strong performance, the strongest performing asset class in the UK since 2011, surpassing all other property asset types, according to Knight Frank. The risks are low as there is an acute undersupply of purpose built student accommodation in the UK. Default in rent is rare as a result of parental guarantee, thus investors are assured of regular and timely rental returns.

Malaysians investing in UK student property are excused from capital gains tax in addition to relief from rental income tax.
The London Spring Place Phase 2 roadshow will be in Sabah and Sarawak from 10am – 7pm this Saturday and Sunday (March 19 & 20), at Le Meridian Hotel Kota Kinabalu, Sabah; Pullman Hotel in Kuching, Sarawak; and RH Hotel in Sibu, Sarawak. For details call 016-228 9150 or 016- 228 8691.

Read more: http://www.theborneopost.com/2016/03/18/uk-student-property-getting-popular-in-malaysia/#ixzz43iDL4ulZ

Malaysian capital market continues to expand in 2015 despite headwinds — SC

March 11, 2016, Friday

Ranjit said RM86 billion was raised through the issuance of private debt securities (PDS) and RM4 billion via initial public offerings.

KUALA LUMPUR: Notwithstanding various headwinds, the Malaysian capital market continued to expand in 2015 to reach RM2.82 trillion in size compared with RM2.76 trillion in 2014, the Securities Commission said.

Growth was driven by the equity market which grew from RM1,651 billion in 2014 to RM1,695 billion by end-2015 while the bond market improved to RM1,125 billion against RM1,110 billion registered in the previous year, said Chairman Datuk Seri Ranjit Ajit Singh in the SC Annual Report 2015.

“Such expansion attests to the sustained ability of issuers to obtain long-term financing from the Malaysian capital market, as fundraising activity remained robust throughout the year,” he said.

Ranjit said RM86 billion was raised through the issuance of private debt securities (PDS) and RM4 billion via initial public offerings (IPOs), bringing the total funds raised through the primary market to RM90 billion in 2015 compared with RM92 billion in 2014.

Meanwhile, a sustained expansion in buy-side liquidity over the year also contributed towards the relative resilience of the capital market, with assets under management (AUM) by fund management companies rising by six per cent to RM668 billion in 2015 from RM630 billion in 2014.

Unit trust funds continued to be the largest source of clients’ AUM with net asset value of RM347 billion by end-2015 compared with RM343 billion in 2014.

The unit trust industry, which is an important proxy for retail investor confidence in the capital market, also recorded surplus sales over redemptions, with the number of units in circulation growing from 425 billion in 2014 to 458 billion in 2015.

While the capital market recorded net portfolio outflows in 2015 in line with global emerging market trends, the value of foreign ownership in the corporate bond market increased slightly from RM13.9 billion in 2014 to RM14.0 billion by end-2015.

Liquidation of foreign portfolio positions in the equity market also took place at a measured pace, with the FBMKLCI recording a decline of -3.9 per cent compared with the MSCI Emerging Markets index which fell -17 per cent over the same period, said the report.

In 2015, Ranjit said the SC continued to diversify channels for financing and investments while broadening access to the capital market by pursuing measures to deepen existing market segments and nurturing new growth areas.

One such area of focus was the Islamic capital market, where Malaysia had firmly established its reputation as a global leader in Islamic finance and the world’s largest issuer of sukuk.

He said extensive work was underway in formulating a roadmap which articulated the SC’s strategy to establish Malaysia as a global Islamic fund and wealth management hub, the release of which was slated for 2016.

Another key market developmental thrust is SC’s ongoing efforts to facilitate access to market-based financing for early and growth-stage companies.

“One of our first initiatives in this regard is the establishment of a regulatory safe harbour for equity crowdfunding (ECF), a class of fundraising activity which enables entrepreneurs to obtain market-based financing for start-ups and early-stage companies,” Ranjit said.

In February 2015, SC became the first regulator in the region to introduce a framework for ECF, with six applicants subsequently approved to become registered ECF platform operators in Malaysia.

Also, as a long-standing champion of initiatives to strengthen the quality of corporate governance in Malaysia, the SC recently concluded the implementation period of the Corporate Governance Blueprint 2011 with 83 per cent of its recommendations already fully implemented.

Moving forward, near-term deliverables included revisions to the Malaysian Code on Corporate Governance 2012, as well as, the release of the Corporate Governance Priorities 2020 which will detail SC’s initiatives for the next five years, he added. — Bernama

Read more: http://www.theborneopost.com/2016/03/11/malaysian-capital-market-continues-to-expand-in-2015-despite-headwinds-sc/#ixzz43iC2FzXt