Letter from Oversea Malaysian? Do we still invest in Bursa Malaysia?

The Letter below is somebody forward to me, I read with Sad and cry, this is our belove Malaysia! Malaysia Boleh! Let us pray for this Country and our nation, think of our next generation! What we can do on that?



Dear Mr Ooi,
I have been meaning to pen some thoughts for some time now, to letpeople actually read the views of the typical 'overseas Malaysian' whois kept away. I realise that my email is rather long, but I do hope thatyou would consider publishing it (and also keep my name private!).
I shall start by telling a little about my background. Mine is a rathersad tale - of a young Malaysian full of hope and patriotic enthusiasm,which is slowly but surely trickling away.
I am very different from many other non-bumiputeras, as I was giventremendous opportunities throughout my childhood. Born into amiddle-class Chinese but English-speaking family, I grew up with all theprivileges of imported books, computers, piano/violin lessons andtuition teachers.
My parents insisted that I should be exposed to a multi-racial educationin a national school. In my time, my urban national school (a missionaryschool) was a truly happy place - where the Malays, Chinese and Indianstudents were roughly equal in proportion. We played and laughed witheach other, and studied the history of the world together during Form 4,with one interesting chapter dedicated to Islamic history.
Though 75% of my teachers were Malays, I never really noticed. My Malayteachers were the kindest to me - teaching me well and offering me everypossible opportunity to develop. I led the district teams for Englishand Bahasa Malaysia debating competitions. I was the only non-Malayfinalist in the Bahasa Malaysian state-level elocution competition. MyMalay teachers encouraged me to transfer to a government residentialschool (sekolah berasrama penuh) so as to enable me to maximise myacademic potential. I refused because I was happy where I was, so theymade me head prefect and nominated me as a 'Tokoh Pelajar Kebangsaan'.Till this day, I am absolutely certain that it was the kindness of allmy Malay teachers which made me a true Malaysian.
I excelled at school and was offered a Singaporean governmentscholarship to study overseas. I turned them down because I wanted toensure that I would remain a 'true Malaysian' in the eyes of Malaysia.So I accepted a Malaysian government scholarship to study at OxfordUniversity. Throughout my three years as an undergraduate, the officersat the MSD looked after me very well, and was always there to offersupport.
I graduated with first class honours, and was offered a job with aleading investment bank. The JPA released me from my bond, so as toenable me to develop my potential. I shall always be grateful for that.I worked hard and rose in rank. My employer sent to me to HarvardUniversity for postgraduate study and I climbed further up theirmeritocratic ladder.
Now I am 31 years old and draw a comfortable monthly salary ofUS$22,000.Yet, I yearn to return home. I miss my home, my family, my friends, myMalaysian hawker food and the life in Malaysia. I have been asked manytimes by Singaporean government agencies to join them on very lucrativeterms, but I have always refused due to my inherent patriotism.
I really want to return home. I have been told by government-linkedcorporations and private companies in Malaysia that at best, I wouldstill have to take a 70% pay cut if I return to Malaysia to work. I amprepared and willing to accept that. My country has done a lot for me,so I should not complain about money.
But of late, my idealistic vision of my country has really come crashingdown, harder and faster than ever before.

I read about the annual fiasco involving non-bumiputera top scorers whoare denied entry to critical courses at local universities and areoffered forestry and fisheries instead. (My cousin scored 10A1's for SPMand yet was denied a scholarship).
I read about UMNO Youth attacking the so-called meritocracy systembecause there are less than 60% of Malay students in law and pharmacy,whilst conveniently keeping silent about the fact that 90% of overseasscholarship recipients are Malays and that Malays form the vast majorityin courses like medicine, accountancy and engineering at localuniversities.
I read about the Higher Education Minister promising that non-bumiputeraMalaysians will never ever step foot into UiTM.I read about a poor Chinese teacher's daughter with 11A1's being denieda scholarship, while I know some Malay friends who scored 7A's and whoseparents are millionaires being given scholarships.
I read about the brilliant Prof. K.S. Jomo, who was denied a promotionto Senior Professor (not even to Head of Department), although he wasbacked by references from three Nobel Prize winners. Of course, histalent is recognised by a prestigious appointment at the United Nations.I read about UMNO Youth accusing Chinese schools of being detrimental toracial integration, while demanding that Mara Junior Science Collegesand other residential schools be kept only for Malays.
I read about the Malay newspaper editors attacking the private sectorfor not appointing enough Malays to senior management level, whilstinsisting that the government always ensure that Malays dominateanything government-related.
I read that at our local universities, not a single Vice-Chancellor orDeputy Vice-Chancellor is non-Malay.I read that in the government, not a single Secretary-General of anyministry is non-Malay. The same goes for all government agencies likethe police, armed forces, etc.
I read about UMNO screaming for the Malay Agenda, but accusing everyoneelse of racism for whispering about equality.I read about a poor Indian lady having to pay full price for a low-costhouse after being dispossessed from a plantation, whilst Malaymillionaires demand their 10% bumiputera discount when buying RM2million bungalows in a gated community.
I read about my beloved national schools becoming more and more Islamicby the day, enforced by overzealous principals.I read about my Form 4 World History (Sejarah Dunia) syllabus, which nowcontains only one chapter of world history, with Islamic historycovering the rest of the book.
As I read all this, I tremble with fear. I love my country and long toreturn. I am willing to take a 70% pay cut. I am willing to face ademotion. I honestly want to contribute my expertise in complexfinancial services and capital markets. But really, is there a futurefor me, for my children and for their children? I am truly frightened.
I can deal with the lack of democracy, the lack of press freedom, theISA, our inefficient and bureaucratic civil service, our awful mannersand even a little corruption. But I cannot deal with racism in myhomeland. I think this is the single biggest factor which is keepingpeople like myself away.
And bear in mind - there are so many of us (researchers, scientists,bankers, economists, lawyers, academics, etc.). What people read aboutin Malaysia (like Dr Terence Gomez) is but the tiniest tip of theiceberg. You will be amazed to know about Malaysians denied JPAscholarships (which would have made them civil servants), took loans toattend Ivy League universities, but who are later asked to advise ourgovernment (on IT, economics, etc.) at fees running to millions of USdollars. Such information will never be published because it ispolitically incorrect.
I pray for God's blessing on this great country of ours.I pray that He blesses our leaders with the foresight and humanity tosee that this will not work and cannot continue. I pray that they willhave the strength to make our country a home for all Malaysians and thatthey will have mercy for the poor, including the non-Malays. I pray fortrue racial harmony and acceptance (not just tolerance) in Malaysia.Yours sincerely,A very frightened Malaysian abroad.

Fast return on Bursa Malaysia? Don't Dream

Yesterday a young investor told me, she lost 70 k during last couple a month. She don't know stocks market all for her life. Just recently joint a malaysia famous chinese cari forum for stocks. She know somebody there and trust their advice. simply throw the money to tomei, oilcorp, uemworld, uem builder.. evne worst is mobif........

It is sad to heard that and hard to believe still got such thing happen in our neigbour or friends, Now she keep asking me the same question. How can i get back the lost money in short term? I tell her. may be for life you won't recover it. unless you go back to fundamental and study , learning basic. otherwise keep money into Shell, or Public bank to earn dividend.

Education and education is important. hope any one friends got similar experience. please forward to this blogs. i willing to share with all ! how to minimise the lost.

For that young friends, final advice, don't believe any body just believe yourself.... ( see my first posting)

A reply from Carotech CFO, WHY Carotech stock balance increase

Thank you for your support and interest in our Company. I believe you may have mistake our stock level for last year. As at 30 June 2005, we had RM15.5m in stocks and this increased to RM29.7m as at 30 June 2006. The significant increase was largely due to (1) The increase of our production capacity by 265% in FY2006 compared to FY2005. Although, the increased capacity was commissioned in the last quarter of FY2005, it was towards the last months in FY2005 and was only fully commissioned in the first quarter of FY2006. (2) Due to the significant increase in capacity, some of our old back end (phytonutrient plant) equipments could not cope with the increased capacity and was constantly failing us in FY2006. This was announced in our Q2 results announcement. Consequently, we were unable to process all our phytonutrient WIPs. We have installed the new equipments in Q4 of FY2006 and are beginning to clear the WIPs as fast as we can.

We thank you for your concern on the possible constraint to our cashflow with such high stocks and we are very mindful of it and will monitor this closely. However, as you are aware, the business of Carotech is essentially in breaking down CPO into four major components, namely Biodiesel, Glycerin, Palm Vitamin E and Carotene. We do not pick and choose what we produce as these 4 components are in CPO and would be a waste if we do not extract any of them. Therefore, inevitably our stocks would increase, in the event our plant is not able to process any of them, resulting in them being in WIP stocks.

Our stocks are keep under close monitor and tight control as these are high value stocks. We have experienced in the past holding these products for more than 3 years without any significant problems. Therefore, provided they are kept in accordance with our Standard Storage Procedures there should be ok and available for future sales once our phytonutrient plant is back to full operation. We are mindful of the need to provide or expense stocks that are no longer of value to the company and this is done monthly.

I hope the above clarifies your queries. I look forward to your continued support and interest in our companies.

Best Regards,
Andrew Goh
Chief Financial Officer Hovid Bhd / Carotech Bhd 121 Jalan Tunku Abdul Rahman 30010 Ipoh, Perak MALAYSIA Tel : +605 506 0690 ext. 166 Fax : +605 506 1215 Webpage : www.hovid.com
Subject: Carotech accounts

Dear Accountant/ Financial Controller.


I am the small investor for hovid and carotech, I asm impressive for your business model , recently when I read the Quarterly annocement for carotec, I found some question on following

1. The stocks level of Carotec from 5 m a year ago to 25m until june 2006, In view of your Sales and your Stock level is extremely exceed 120 day holding level. My question here :

a. The high stock level is for production user or what other reason, The rational to keep 120 days stock. Does short supply of Raw material or re- order lead time? if for future use, why need to build up the stock now ? This question is rather important to view the tight cashflow and heavy expansion. to cope with market demand on bio diesel.

b. Any valuation issued on stock holding ? damaged or expired goods ! need to ractify? For Company size like hovid or carotec 20 M is BIG SUM.

Hope to received reply soon as myself and my group of friend is very impress your business model.


TQ


A reply from Carotech, I am Thank for sincere reply from him, I been write to many FC/Accountant for listed company. Some of them even not reply me, some of them will only reply with very formal answer. But…
I am public this reply due to impression that, they are sincere and trust to shareholder. With the special business (bio-diesel) and the only bio- diesel operator in Malaysia (listed unit). I will keep buying Carotech and Hovid. (not any recommdation to other.Mark my word, only trust yourself!)

Only thing is the historic of it, is too short for further analyses their financial result. And recently week in their share price(0.85at last Friday 23/9/06). I saw a golden opportunity to accumulated.

Why Shareholder like Dividend

Shareholders like dividends because...
Shareholders have their own personal cash needs and self-select the companies whose dividends satisfy these.
Preferred shareholders like common share dividends because it creates a cushion that must be cut before their own dividends are.
Shareholders feel the risk of returns from reinvested earnings at a later date, is higher than the risk of cash received today.
Benjamin Graham and David Dodd, in the classic 1934 reference Security Analysis, suggest that retaining earnings is, in effect, management dictating to owners how to invest their money.
Reasons companies don't pay dividends
Management and the board may believe that the money is best re-invested into the company: research and development, capital investment, expansion, etc. Proponents suggest that a management eager to return profits to shareholders may have run out of good ideas for the future of the company.
When dividends are paid, shareholders in many countries suffer from double taxation of those dividends: the company pays income tax to the government when it earns any income, and then when the dividend is paid, the individual shareholder pays income tax on the dividend payment. This is often used as justification for retaining earnings, or for performing a stock buyback, in which the company buys back stock, thereby increasing the value of the stock left outstanding. The shareholder will pay a tax on capital gains (which is often taxed at a lower rate than ordinary income) only when the shareholder chooses to sell the stock. If a holder of the stock chooses to not participate in the buyback, the price of the holder's shares should rise, but the tax on these gains is delayed until the actual sale of the shares. Certain types of specialized investment companies (such as a REIT in the U.S.) allow the shareholder to partially or fully avoid double taxation of dividends.
Shareholders in companies which pay little or no cash dividends can reap the benefit of the company's profits when they sell their shareholding, or when the company is wound down and all assets liquidated and distributed amongst shareholders.

The above is more useful link for US concept, in Malaysia, we need to settle the tax difference before we can earn out net dividend or money received. This is unfavour for creating shareholder value or encouraging public to invests.

Why I am fail in investing in Bursa Malaysia?

The purpose of the article is share my fail experience to all to avoid you continous losing money in your investing career. Regardless where you are and who you are.

1. Don’t Ever Think of borrow money or bank loan or bank overdraft , Market fluctuation will make u crazy and heart attack
2. Don’t invest in warrant. Or anything so call tools for financing. Unless you are gambler (for gambler advice you go casino, atleast the change is 50% to 50%). The only exception is you are rich enough and holding substantial volume of that counters.
3. Don’t ever invest in small cap with no strong background (Big Cap holding or rich man holding). Only permissible when they are trace records .
4. Don’t ever buy at first day of IPO of any stocks, the change going south after first day is 80% (don’t believe, try yourself)
5. Don’t ever think of speculate or listening to rumours.
6. Don’t trust any body or word from any body, only trust yourself, of course you must prepare yourself before you can trust yourself.
7. Don’t try to win the market , you only can follow the market except you are riches can control that particular counter (syndicate).
8. Only invest in high growing, potential sector counter, don’t go again market.
9. Only Buy Big Cap with strong branding or industries with inelastic demand
10. Only buy with any high dividend counters, money won’t cheat you.
11. Don't invest in "IT stocks", The industries is highly competitir and you may win 50% over nite or you may lost whole at last, Good example is AKN MSG , Redtones.. high may be 3.00 now only 30 cent. just imagine you left 10% after all, I am not pin point to any counter at the movement,. Just for sharing.
12. Don't invests in sector you donno or you don't know how the Company operation.
13. Don't buy the stocks which you donno the owner!.
14. Don't buy the industries, highly dependance on Raw Material Price and Highly dependence of few customers
15.buy small caps only when they got strong owners or big caps subsidiary.