This is the 4th Trip to PAN MALAYSIA CORP (4081) Annual General Meeting since I first bought its shares 7 years ago with a group of Investors in OSK Johor. I started investing in Shares 7 years ago and bought into 130 Counters in the KLSE. At that time PM Corp was traded at 25 cents a share. It has fallen to as low as 7.5 cents but recovered to 14 cents.
Why Do We Still Keep This Counter Since It Has Been Performing Miserably? We have posted on 27th May 2013 that PM Corp (4081) is the most undervalued share in the KLSE. In 2008 before the LEHMAN BROTHERS’ COLLAPSE I sold off all the 130 counters except one – OPCOM.
OPCOM which we bought as high as RM1.00 crashed to below 30 cents! But in 2008 when everything was in shock & panic, OPCOM was debt free. Its NTA (Net Tangible Asset) was 50 cents. Moreover, it is giving a decent dividend of 6%. So we loaded up on OPCOM. As the market rebounded we sold off as high as RM1.00. For those who have bought at 30 cents.
They have already received back their original capital. There were capital repayment of 22.5 cents & tax exempted dividend of 10 cents. OPCOM is still traded at 75 – 80 cents currently. Warren Buffet says, “To be fearful when others are greedy; and to be greedy when others are fearful.”
After Selling Off OPCOM we revisited One Particular Counter Because
- It has High Tangible Net Asset.
- It Has A Highly Defensive Business – Consumer Food- chocolate especially.
That Counter is PAN MALAYSIA CORP (4081).
My 3 earlier Trips to the AGM were held in CORUS HOTEL, KL (Right Across Petronas Twin Towers). It was the first time I attended an AGM. And what a hostile scene I saw. Disgruntled shareholders were voicing their unhappiness over their losses. I was the Only One Who Was Optimistic, then.
I spoke of the glowing prospects of PM COPR Which Own The NETWORK FOOD INDUSTRIES. LIKE APOLLO, OFI (ORIENTAL FOOD INDUSTRIES), NESTLE, DUCTH LADY MILK INDUSTRIES, HUP SENG, COCOALAND, OLD TOWN COFFEE, GUAN CHONG, MAMEE & MANY OTHER MALAYSIA FOOD MANUFACTURERS Which Will Do Exceeding Well Because Of CHINA MELAMINE FOOD POISONING!
All 3 Past Meetings In KL were in Hostile Atmosphere. Because the Company is still bleeding losses! In All 3 Meetings I was still optimistic! I strongly believe that it will not fail because it is now ALMOST DEBT FREE & CASH RICH! Not only that, I told Director Mr. James Wong Ngen Fatt that he had done an excellent job in turning the RESULTS POSITIVE FOR THE LAST FIVE QUARTERS.
The Attitude Has Definitely Turned For The Better in the latest AGM held at CORUS PARADISE HOTEL IN PORT DICKSON.
However, one or two shareholders still speak in serious tone at the Meeting. I spoke to a Mr. Ong after the Meeting and asked him why he was still unhappy when the results are so good now. He said that he is worried for the RM90 Millions Cash that the Management might misuse. So he is here to voice out his concern.
I asked him whether he knew about the further RM38.2 Millions Cash Sale of Woodland Warehouse? In Singapore. He Said that he had “No Idea”. But he said that he bought PM Corp at a price as high as RM1.80 in 1994. Actually, I told him, the NTA & Intrinsic Value of PM Corp is RM1.30 if he would wait patiently.
Among the Directors is Mr. Wong Aun Phui. At 91 one years old he is still strong and healthy. His secret is to exercise 30 minutes a day & never eat outside food. He bought a house with an acre land in Jalan U Thant – 50 years ago. The Price? At 90 cents per sq ft. He said that it is now worth RM500 psf.
I said it is worth far more than RM500 psf. Located within View of Petronas Twin Towers in KL it is now worth RM1,500 psf. You see, the very rich invests for decades. In this case – 5 decades. At 90 cents psf – an acre works out to be around RM40,000 then. And at RM1,500 an acre would be worth over RM65 Millions today! This is the lessons for us.
At The AGM The Directors Have Proposed Share Capital Reduction & Distribution By Cash Or Treasury Shares.
“OVER A SHORT PERIOD THE SHARE MARKET IS A VOTING MACHINE; BUT OVER A LONG PERIOD OF TIME THE STOCK MARKET IS A WEIGHING MACHINE.”
Wishing You All The Best! Have a Productive Day.
NOTE: WHY THERE IS SO LITTLE TRADING ACTIVITY IN PM CORP? BECAUSE THE THIRTY TOP SHARE HOLDERS OWN 77% OF THE LISTED SHARES. PLUS THE COMPANY SHARE BUYBACK OF MORE THAN 8%. OVER 85% OF SHARES ARE TIGHTLY HELD. THE TREASURY SHARES WERE PURCHASED FROM 30 CENTS TO 20 CENTS.
THERE REMAINS ONLY LESS THAN 15% FREE FLOAT FOR TRADING IN THE OPEN MARKET. WHEN THIS 15% IS TAKEN UP, YOU WON’T BE ABLE TO BUY SO UNDERVALUED SHARES ANY MORE.