Best World

[Roberto76]

Just saw some posts on share junction. wanted to list a few interesting replies here. hope it is useful.

1. <Edited Out by Moderator>

2. read through the article and i, in fact must say that BW should actually thank Bonitas.
They claim fake sales etc, but then they say Best World's founders exponentially accelerated their combined annual take home pay by 20x in five years, earning less than S$ 2 million in 2013 to receiving S$ 40+ million in cash in 2018. If really no money, how can the founders increase by 20X.
Bonitas also claimed that there was not much selling going on, in fact none. BW do not do channel stuffing, that' s why ppl can' t buy the products on the spot at the lifestyle centres. They need to place order, make payment then come back and collect at a later date. Upon collecting payment, the centre will aggregate the orders, place order with BW, then BW will send the products to the centre.  

3. <Edited Out by Moderator>

[CY09]

A Reminder not to post defamatory comments without evidence, even if they are quoted from other sources

[weijian]

Bonitas Research calling Best World "a fraud" on their report

https://www.bonitasresearch.com/company/best_world/

Their CEO looks like a fraud. Go see his face and you will know what i mean

This is an unwarranted personal attack. The post is undecent, disrespectful and violate forum rules below: https://www.valuebuddies.com/thread-1844.html

Although you are a first time offender but this crosses the line severely. A 3 days suspension has been meted.

Moderator

[Big Toe]

Best world piqued my interest, even though I have 0 intention of owning it at any price(with very slight desire to short it). Great for learning.Franchise or direct selling model does not really matter in my opinion. From evidence presented in reports, it is at best operating in a grey area in China. Let's just skip that and assume they are operating within legal boundaries. My best guess is their products cant sustain high growth or even stay at the same level 5-10 years from now. The only way to do that is to constantly innovate(RnD) and be best in class.

Correct me if I am wrong, I don't see supplier quality, biotech, lab jobs on their main site. Even if they do not formulate/manufacture most of their products who's checking and testing these products? Outsourced 100%? Instead I see a lot of .... fluff(I dont like fluff, not at all). So at the end of the day, what is best world as a company? A company with real sustainable and durable moats?

So I have a bit of time on my hands and decided to check on their Dr's Secret You tube channel as well as youku. Well, Youku is entertaining You tube. First glance not bad, top videos have 300+K to 800+K views. But wait, after watching these videos, the top video has >800K views with 2 likes 3 dislike and 0 comments? The majority of the videos have tens to hundreds views with the same content. After the ordeal of watching the videos, I decided to go back and continue watching my favorite character on you tube. Nyango star. Nyango star is a cross between an apple and a cat, fyi.

[weijian]

 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.'

I will observe this at the sidelines with an open mind.

Some years back, Glaucus Research (predecessor to Bonitas Research) initiated a short report on China Minzhong (CMZ). It was a company i owned then (I even increased my stake after the clouds were cleared) - End of the day, probably both Glaucus Research made money (since CMZ dropped 50% on the day the report was released) and I also made money (when Mgt did a MBO). Fraud was never proven - but 1 thing for sure was that it prompted Mgt to do shareholder friendly things like increased dividend payout/scale back on CAPEX etc. But at the same time, it also kept investors away despite all these shareholder friendly moves.

My guess is that it is probably too early to take sides - Mr Wee could be right. Bonitas could be right. What is really interesting is to see how this evolves in real time and see the behaviors/reactions of all the various actors, and then hopefully learn a few new interesting things about human behavior.

So keeping this open mind allows an independent unrestricted broad view of this whole saga, and hopefully allows me to keep similar independent thoughts when i have to encounter my next.

[weijian]

Since the Datapulse saga, SGX regCO has learnt its lesson to set the terms of reference for special audits - direct report to SGX regCO and also SGX regCO to set the terms of reference for the audit. IMO, It should definitely also be the one to appoint the independent auditor.

SGX orders independent review of issues raised by Best World short-seller

THE regulatory arm of the Singapore Exchange (SGX) has ordered a review of Best World International's business in China, to address all matters raised in a short-seller report after the stock fell 9 per cent on Wednesday.

The reviewer will be required to report directly to SGX RegCo and the company's audit committee. The Business Times understands it has not been determined whether the review will be done by PwC (which Best World hired for an independent review on the franchise model adopted by the company in China last year) or another party.

In a statement on Wednesday, SGX RegCo said it is aware of Bonitas Research's short-sell report on the premium skincare firm: "We posed earlier today a trading query to the company and its shares have since been halted.

"We expect the company to call for a full independent review of all matters raised in the report so that shareholders will have a complete picture and can make informed decisions.

"We expect to be consulted on the terms of reference of the review and will require the reviewer to report directly to us and the company's audit committee."

https://www.businesstimes.com.sg/compani...ort-seller

[luckystar]

One thing I am waiting to see is whether the Chinese authority has been alerted to BW alleged supposedly illegal MLM activities in China. Bonitas can stand to make a lot of money on its short position should its accusations be proven true. I would be keenly watching whether Bonitas made the complaint to Chinese government.

I would do it if I were Bonitas.

[karlmarx]

I will observe this at the sidelines with an open mind.

Some years back, Glaucus Research (predecessor to Bonitas Research) initiated a short report on China Minzhong (CMZ). It was a company i owned then (I even increased my stake after the clouds were cleared) - End of the day, probably both Glaucus Research made money (since CMZ dropped 50% on the day the report was released) and I also made money (when Mgt did a MBO). Fraud was never proven - but 1 thing for sure was that it prompted Mgt to do shareholder friendly things like increased dividend payout/scale back on CAPEX etc. But at the same time, it also kept investors away despite all these shareholder friendly moves.

My guess is that it is probably too early to take sides - Mr Wee could be right. Bonitas could be right. What is really interesting is to see how this evolves in real time and see the behaviors/reactions of all the various actors, and then hopefully learn a few new interesting things about human behavior.

So keeping this open mind allows an independent unrestricted broad view of this whole saga, and hopefully allows me to keep similar independent thoughts when i have to encounter my next.

You're right, I'm getting ahead of myself. It isn't over yet. 

But the points raised by boon, Marissa Lee, and more recently Bonitas, are sufficient for me to not want to put any money into it.

It doesn't make sense to me to put money into companies where its revenue generating model/ability is doubtful, to say nothing of its expensive price.

[Retired@52]

Dear Value Buddies,

Some Lessons to Learn from this Saga, regardless of the outcome of the investigations.
Short Sellers normally target a company which share price runs up with a whopping few thousand % in a relatively short period of time.

The adjusted share price of this company was $0.128 in February 2016. It rose to $3.33 in Feb 2019
(A whopping 2,600% or 26 baggers in 3 years)

I bought this share in 2009 at about $0.20 per share. I sold it in 2017 at about $2.60
(Made hundred over thousand, about 1,300% or 13 baggers in 8 years, not too bad an investment)

Ability to “Let Go” is important. Let others earn the last few dollars, it is far too risky.

When I chose to retire at age 52, many of my friends asked: “If you were to work for another decade, wouldn’t you make another 1 or 2 Million Dollar?”
I said “Yes” But the risk is too high:
I may get sacked then loss all the reputation.
I may get sick due to stress then loss the health.
I will definitely loss my time to do all the enjoyable things which I’m now doing.
So dear friends, when we make enough, let go and let others take the last few Dollars.

[chialc88]

Thank you Retired@52 reflections.

Well done and excellent tips to "Let go".

As we are not vested, let's just keep an open mind and see how the saga unfold.

I have confident on the D2 integrity.

They definitely will ensure that their business is legitimate.

That's not my point.

My point is what's the Franchisee conducting *their* business?

I'm quite sure, bwl DS license is abused by the Franchisee.

Damaged already done.

Question is how bad will it impact the business?

D2 will try very hard to restore the trust of the public (and share holders)?

Let's give them some time and a chance to clarify.