Best World

[dreamybear]

If BW did nothing wrong, it will probably release another clarification document to Bonitas Research.

Although BW is still quite a significant portion of my portfolio, I welcome such reports. At least, they conducted site visits to different China franchises/offices and showed some pictures. It is very difficult for us to conduct channel checks as we are not based in China; not easy to travel to different parts of China; hard to get to know any China based distributors or franchise owners.

I am still trying to absorb the materials, but as for the "deserted" franchises, my initial thought is 1Q is usually the slowest for BW, so there may not be much activity anyway. As a matter of fact, I think BW SG lifestyle shops are usually quite empty, although they adhere strictly to operating hours.

[Life is a game]

there was a red flag last year when DBS stop coverage as they cannot reconcile the sales from China. the main problem here is whether BW is engage in MLM in China using franchise or direct selling as front. substance over form. if indeed the case, China authorities are fast on this and 50 percent profit is at stake while other countries sales are decreasing. Also, need more clarity on the one major customer in China, what is the role of that entity.

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[Squirrel]

If BW did nothing wrong, it will probably release another clarification document to Bonitas Research.

Although BW is still quite a significant portion of my portfolio, I welcome such reports. At least, they conducted site visits to different China franchises/offices and showed some pictures. It is very difficult for us to conduct channel checks as we are not based in China; not easy to travel to different parts of China; hard to get to know any China based distributors or franchise owners.

I am still trying to absorb the materials, but as for the "deserted" franchises, my initial thought is 1Q is usually the slowest for BW, so there may not be much activity anyway. As a matter of fact, I think BW SG lifestyle shops are usually quite empty.

Hey there dreamybear. Just want to make sure you actually went into the report itself to take a look and didn’t just read the summary. The pdf report requires you to provide an email before letting you have a look at it. There are quite interesting information inside that you should take into account.

Just Some other observations

Bloomberg article says (https://www.google.com/amp/s/www.bloombe...hares-drop)
1) Best World has the highest short interest over free float in SGX
2) Short Interest doubles over the month
3) Bonitas initiates a short and these companies benefits from short selling stocks
4) Bonitas mentioned the hope that regulators pick up on the irregularities of conduct following crackdown on Quan Jian etc

Would it be too far to imagine Bonitas reporting to authorities MOFCOM about their discoveries? It does seem like they have teams on the ground. Would that mean that there is a very real possibility of BWL’s business in China evaporating overnight? How much business would there be left in Taiwan and the others category to support current market valuation?

[karlmarx]

 Boon, not even looking at the price, so no intention to enter anytime soon.

回头太难     Anyway, just to let you know quite a no. of brokerages has imposed trading restrictions on BW.


BEST WORLD: Investor gives his take on BT article
Published: 06 March 2019

Jason Wee, CFA, who has been a Best World International shareholder for several years, was Head of Asian Small Caps Research at CLSA, until he retired. He contributed this article to NextInsight.

More details on : https://nextinsight.net/story-archive-ma...bt-article

“[i]Writing a gutsy piece challenging a listed company is even more challenging. In my 13 years as an analyst, which culminated with a top ranking for my pan-Asian small caps coverage, I too have come across dozens of companies with questionable business models. Yet, I have only publicly challenged one. The reason is simple - getting it wrong can result in a lingering negative stain on an otherwise healthy and promising business.”

-- Jason Wee, CFA[/i]

---

Mr Wee dismissed the BT article with few supported reasons, and much rhetoric. I wonder how many (unfortunate) BWL investors bought his story.

I also wonder if the former 'Head of Asian Small Caps Research,' truly believed that a management's response should be treated as the true and final word. Or maybe he owns some shares in BWL.

If he truly believed in the integrity of the business, this tells you how much corporate titles, CFA accreditation, and 'many years of experience' are worth when it comes to making/providing quality investment advice: diddly.

If he held shares in BWL, and/or was writing against Marissa Lee only to defend his interest in BWL, this shows you how 'titles, accreditation, and experience' can mean even less.

In any case, an investor should always keep their wits about themselves. Especially when confronted with individuals pronouncing their 'titles, accreditation, and experience.'

[Life is a game]

where is boon? he has alot of knowledge in BW, waiting for his comments.

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[chialc88]

@Squirrel, don't touch. this will takes at least 1 month of selling.

This is the time to keep a cool mind (and listen):



Thank you and appreciate all the tips from valuebuddies.
B especially.

[Squirrel]

@Squirrel, don't touch. this will takes at least 1 month of selling.

This is the time to keep a cool mind (and listen):



Thank you and appreciate all the tips from valuebuddies.
B especially.

Did I give the impression that I would touch this? I thought I have been quite negative on it. I have mentioned many posts back that I am out of this stock and not going to pick it up ever again. This is after all the investigations and discussion by buddies here that I came to the conclusion.

However this is still my best investment ever. Probably one that changed my portfolio forever.

Thanks everyone, the history in this thread is highly valued in my own investment journey and an important chapter.

[dreamybear]

Hey there dreamybear. Just want to make sure you actually went into the report itself to take a look and didn’t just read the summary. The pdf report requires you to provide an email before letting you have a look at it. There are quite interesting information inside that you should take into account.

Just Some other observations

Bloomberg article says (https://www.google.com/amp/s/www.bloombe...hares-drop)
1) Best World has the highest short interest over free float in SGX
2) Short Interest doubles over the month
3) Bonitas initiates a short and these companies benefits from short selling stocks
4) Bonitas mentioned the hope that regulators pick up on the irregularities of conduct following crackdown on Quan Jian etc

Would it be too far to imagine Bonitas reporting to authorities MOFCOM about their discoveries? It does seem like they have teams on the ground. Would that mean that there is a very real possibility of BWL’s business in China evaporating overnight? How much business would there be left in Taiwan and the others category to support current market valuation?

Hi Squirrel,

Yes, I am aware of the pdf. Thanks for your concern - it is much appreciated.
This is a good forum - forumers share their knowledge/concern abt possible pitfalls on investing.

Although I cannot read people like WB, based on my experience in BW AGMs, I cannot imagine the founders are the type of people who will engage in fraud(it's just my personal opinion - do note I am a nobody). Both Doreen and Dora hv also appointed their children as alternate directors on 16 Jan 2019, perhaps signifying handing the Co over to them in the forseeable future.

Having said this, I believe the China growth story will never be smooth, and that doing business in China is super complex(like many countries within a country), and we cannot approach 2nd/3rd/4th tier cities based on our Singapore way - everything done procedure by procedure or every email/decision/minutes of mtg covered/documented, etc. The behaviour/culture of the people will not be like our typical SG MNC / civil service / office workers.

But I think if Nuskin can be very successful in China(despite also facing hiccups along the way and still increasing its China revenue), it means it is feasible. In fact, Ping An ZQ Capital and ZQ Capital invested in Nuskin in 2016(worth mentioning here tt CIC also invested in Noble but ...). The key risk, IMO, is whether the China franchises behave as they shd.

IMO : Given its present situation, for unvested investors, it might be better to stay away till the coming AGM where hopefully things are clearer. BW is currently abt 12x PE & 4-5% dividend yield(inclusive of special div), with China forming 54% of revenue in 2018.

Also, 财经郎眼 has an episode on 15/04/2019 mentioning Medical Pdts/Quanjian/MLM : https://www.youtube.com/watch?v=jSWJfxWcsVI   

On Bonitas, I wld think they engaged local Chinese ad hoc to investigate(rather than having a perm China office), coz I remember watching a documentary whereby another short seller did the same thing to successfully uncover fraud in China.

Yes, thanks for all buddies for their views/contributions indeed !

[dreamybear]

.....

However this is still my best investment ever. Probably one that changed my portfolio forever.

....

Hope it has uplifted your "lifestyle" too !

[chialc88]

@squirrel - good call. Excellent.
Thank you for your great analysis in other stocks too.

I benefited tremendously from you sharing.


It's time to keep cool:

All of the times when everything is wrong

And you're feeling like
There's no use going on
You can't give it up
I hope you work it out and carry on