Best World

[dreamybear]

Yes, those who had "weak hands" or mention (was in their telegram chat) it was more worth while to accept the offer and rotate out to US/China Tech in Jan 2022, on hindsight, would have regretted it.

As OPMI, we are at the mercy of the controlling shareholders. OPMIs could have banded together and mount a challenge against the controlling shareholders. However as seen in the Best World Telegram chat and Sembcorp Marine rally against the merger, it is a big hurdle to unify a large enough pool of OPMI. If we are to take reference to Malaysia politics, it was like how Anwar, Mahatair and a few others banded together against UMNO but then halfway through, the sheraton movement occurred which resulted in the alliance breaking apart.

The moment a few OPMIs are swayed, OPMIs will lose an upper hand against the controlling shareholder even before being able to mount a challenge

In BW's case, what puzzled me most was the lack of active involvement by the Top XX retail shareholders. Given the amount at stake (millions of dollars), I would have thought there could be something more prominent along the lines of votenoformerger (SCM), as those most financially affected fight for their interests.

It has been some 3 wks since the trading resumption, and thankfully, it was largely uneventful - no new short reports, trading halt, etc *touch wood*. I would think the independent reviews, audits, etc over the recent years have addressed the claims by the short sellers. 

However, based on the financial ratios of BW, it has been/is trading at very attractive levels since resumption. Why ? Is it because investors are still apprehensive ? Is it because the $1.36 EAO hasn't gone down well with shareholders given the current share price upon resumption ? 

Nevertheless, this episode has made me wonder whether simplistically speaking, value investing in OPMI context, is merely a game of chance betting on the "reaction" of the mkt participants where deeper knowledge just serves to give better odds. In BW's case*, OPMI investing in BW at current valuation is probably betting that BW will trade back at historical valuations. OPMI do not get to make capital allocation decisions - dividend payout ratio, etc., to affect the share price positively. To fully participate in BW's growth and realize the intrinsic value of BW, it is a different story altogether - one has to buy the entire business at an undervalued price. 

*emerge from long suspension, challenging prospects as described in BW results statement

-------------------

What Is Value Investing?
Value investing is an investment strategy that involves picking stocks that appear to be trading for less than their intrinsic or book value. Value investors actively ferret out stocks they think the stock market is underestimating. They believe the market overreacts to good and bad news, resulting in stock price movements that do not correspond to a company's long-term fundamentals. The overreaction offers an opportunity to profit by buying stocks at discounted prices—on sale......

Market Moves and Herd Mentality
Sometimes people invest irrationally based on psychological biases rather than market fundamentals...... 

https://www.investopedia.com/terms/v/val...-investing  (emphasis added)

[¯|_(ツ)_/¯]

Yup, this would be the Mr Market and MOS theory that's advocated by our value buddies.

Just add on that there are 2 theories which is exactly opposite but both are practiced by successful value buddies:
1) Focus on fundamentally strong company and too advantage to buy when Mr Market throw in a price that value buddies could not resist.

or
2) Just pick up 100-200 undervalue stocks and sell when any of the stock price reached its valuation price or when holding for more than (says) 3 years - which ever come first.

#2 is very interesting and practiced by Eric and Yeoman too.



Gratitude.

[Shiyi]

Yes, those who had "weak hands" or mention (was in their telegram chat) it was more worth while to accept the offer and rotate out to US/China Tech in Jan 2022, on hindsight, would have regretted it.

As OPMI, we are at the mercy of the controlling shareholders. OPMIs could have banded together and mount a challenge against the controlling shareholders. However as seen in the Best World Telegram chat and Sembcorp Marine rally against the merger, it is a big hurdle to unify a large enough pool of OPMI. If we are to take reference to Malaysia politics, it was like how Anwar, Mahatair and a few others banded together against UMNO but then halfway through, the sheraton movement occurred which resulted in the alliance breaking apart.

The moment a few OPMIs are swayed, OPMIs will lose an upper hand against the controlling shareholder even before being able to mount a challenge

In BW's case, what puzzled me most was the lack of active involvement by the Top XX retail shareholders. Given the amount at stake (millions of dollars), I would have thought there could be something more prominent along the lines of votenoformerger (SCM), as those most financially affected fight for their interests.

It has been some 3 wks since the trading resumption, and thankfully, it was largely uneventful - no new short reports, trading halt, etc *touch wood*. I would think the independent reviews, audits, etc over the recent years have addressed the claims by the short sellers. 

However, based on the financial ratios of BW, it has been/is trading at very attractive levels since resumption. Why ? Is it because investors are still apprehensive ? Is it because the $1.36 EAO hasn't gone down well with shareholders given the current share price upon resumption ? 

Nevertheless, this episode has made me wonder whether simplistically speaking, value investing (in OPMI context) is actually just a game of chance betting on the "reaction" of the mkt participants where deeper knowledge just serves to give better odds. In BW's case*, OPMI investing in BW at current valuation is probably betting that BW will trade back at historical valuations. However, to fully participate in BW's growth and realize the full value of BW, it is a different story altogether - one needs to have a controlling stake. 

*emerge from long suspension, challenging prospects as described in BW results statement

-------------------

What Is Value Investing?
Value investing is an investment strategy that involves picking stocks that appear to be trading for less than their intrinsic or book value. Value investors actively ferret out stocks they think the stock market is underestimating. They believe the market overreacts to good and bad news, resulting in stock price movements that do not correspond to a company's long-term fundamentals. The overreaction offers an opportunity to profit by buying stocks at discounted prices—on sale......

Market Moves and Herd Mentality
Sometimes people invest irrationally based on psychological biases rather than market fundamentals...... 

https://www.investopedia.com/terms/v/val...-investing  (emphasis added)

IMHO, value investing should also take into account the corporate governance. The company has not distributed dividends for years as it wants to "conserve cash amidst uncertain operating environment". But the two founders have drawn a salary package as much as the bank's CEOs. What's the "intrinsic value" for if minority shareholders don't get to enjoy it?

[dreamybear]

Yup, this would be the Mr Market and MOS theory that's advocated by our value buddies.

Just add on that there are 2 theories which is exactly opposite but both are practiced by successful value buddies:
1) Focus on fundamentally strong company and too advantage to buy when Mr Market throw in a price that value buddies could not resist.

or
2) Just pick up 100-200 undervalue stocks and sell when any of the stock price reached its valuation price or when holding for more than (says) 3 years - which ever come first.

#2 is very interesting and practiced by Eric and Yeoman too.



Gratitude.

If BW is now on your watchlist/portfolio and u dun mind sharing, may I ask whether you feel that the current BW is a fundamentally strong co and currently trading at an irresistible price of $1.76 (reference your pt 1) ? 

Speaking of Aggregate Value Fund, NAV (Dec 2012) : 100.37, NAV (Oct 2022) : 168.55 => NAV appreciated about 70% over appr 10 years. 

https://aggregate.com.sg/performance/

[dreamybear]

Yes, those who had "weak hands" or mention (was in their telegram chat) it was more worth while to accept the offer and rotate out to US/China Tech in Jan 2022, on hindsight, would have regretted it.

As OPMI, we are at the mercy of the controlling shareholders. OPMIs could have banded together and mount a challenge against the controlling shareholders. However as seen in the Best World Telegram chat and Sembcorp Marine rally against the merger, it is a big hurdle to unify a large enough pool of OPMI. If we are to take reference to Malaysia politics, it was like how Anwar, Mahatair and a few others banded together against UMNO but then halfway through, the sheraton movement occurred which resulted in the alliance breaking apart.

The moment a few OPMIs are swayed, OPMIs will lose an upper hand against the controlling shareholder even before being able to mount a challenge

In BW's case, what puzzled me most was the lack of active involvement by the Top XX retail shareholders. Given the amount at stake (millions of dollars), I would have thought there could be something more prominent along the lines of votenoformerger (SCM), as those most financially affected fight for their interests.

It has been some 3 wks since the trading resumption, and thankfully, it was largely uneventful - no new short reports, trading halt, etc *touch wood*. I would think the independent reviews, audits, etc over the recent years have addressed the claims by the short sellers. 

However, based on the financial ratios of BW, it has been/is trading at very attractive levels since resumption. Why ? Is it because investors are still apprehensive ? Is it because the $1.36 EAO hasn't gone down well with shareholders given the current share price upon resumption ? 

Nevertheless, this episode has made me wonder whether simplistically speaking, value investing (in OPMI context) is actually just a game of chance betting on the "reaction" of the mkt participants where deeper knowledge just serves to give better odds. In BW's case*, OPMI investing in BW at current valuation is probably betting that BW will trade back at historical valuations. However, to fully participate in BW's growth and realize the full value of BW, it is a different story altogether - one needs to have a controlling stake. 

*emerge from long suspension, challenging prospects as described in BW results statement

-------------------

What Is Value Investing?
Value investing is an investment strategy that involves picking stocks that appear to be trading for less than their intrinsic or book value. Value investors actively ferret out stocks they think the stock market is underestimating. They believe the market overreacts to good and bad news, resulting in stock price movements that do not correspond to a company's long-term fundamentals. The overreaction offers an opportunity to profit by buying stocks at discounted prices—on sale......

Market Moves and Herd Mentality
Sometimes people invest irrationally based on psychological biases rather than market fundamentals...... 

https://www.investopedia.com/terms/v/val...-investing  (emphasis added)

IMHO, value investing should also take into account the corporate governance. The company has not distributed dividends for years as it wants to "conserve cash amidst uncertain operating environment". But the two founders have drawn a salary package as much as the bank's CEOs. What's the "intrinsic value" for if minority shareholders don't get to enjoy it?

Well, I think that is a valid point and rather disappointing for us indeed.

Moving fwd, a healthy dividend payout ratio declared over the FY results should be able to support a healthy share price. I fear it cld be "disastrous" for us OPMI if otherwise. In any case, I certainly do not wish to see the share price drifting back to $1.36 !  

[¯|_(ツ)_/¯]

@db

If BW is now on your watchlist/portfolio and u dun mind sharing.
>>> Yes on watchlist but no longer vested.  
>>> All my BW stock was brought below 20cents roughly 10 years ago.  At it's peak, this single stocks was at 40% of my portfolio.  After getting the bonus shares, I sold all in one go when I hear about university students was lure to quite their study and become a direct sell agent; subsequently committed suicide as this "entrepreneur" venture does not play out as plan. Shortly, the short seller story broke out and I felt really lucky that I had jump ship before the price drop and eventual suspension.

May I ask whether you feel that the current BW is a fundamentally strong co and currently trading at an irresistible price of $1.76 (reference your pt 1) ?
>>> In short - yes, BW is a fundamentally strong co - even if you include corp governance.  I'm not very good at valuation because I felt that valuation is a highly speculative and everyone (including insider such as Founder, CEO and MD) do not have a accurate way to valuate their stock.  And, it's even much more difficult to predict the "correct" price of their company.
>>> I see the current price (not just BW but for all stocks) as the balancing point of buyers and sellers aka nothing to do with the company value (or growth potential). 
>>> If you asked me whether I will buy at current price, then the answer would be no. My plan was to buy BW below $1.36 - don't laugh.    
>>> If the day come, I will definitely dip my toes inside. If not, then nevermind law, there are so many fundamentally sound company trading at a fantastic price. There are so many investment opportunities to be discovered aka no need to be so kang-jong with BW.  

Gratitude.

[dreamybear]

@¯|_(ツ)_/¯

Thx for sharing your thoughts. There doesn't seem to be much interest discussing this stock in detail, so it is helpful to know what buddies are thinking.

No, I dun find your plan funny - In fact, I still have an active GTD $1.36 buy order(put in much earlier), though it looks unlikely to be filled, which ironically is a relief to me.

[¯|_(ツ)_/¯]

@db, 
Most (if not all) of SGX stocks were not sexy.
Those sexy one (including BW) had already moved (aka discovered).

Occasionally, there are windows of opportunities pop up for arbitration which is ok for value buddies who is investing as a hobby - but not enough to sustain the family of a full time investor ** OWN VIEW **

Instead of looking for arbitration opportunity, a better way is to identify long(er) term and sustainable business (SGX stocks) which could give a constant stream of income - hopefully could beat inflation.  As far as I am concern, these stocks exist in SGX and I'm sure a lot of our value buddies already vested in them.  One characteristics of these stocks is the business seldom change and the result is rather constant/predictable.  Because of this characteristics, there is actually no need to keep following or discussing about their business/performance. 

What I meant is these perpetual earning machine is already in the pocket of most value buddies and there is no need to keep talking/discussing about them.  Obviously, for those younger value buddies who is looking for quick profit, these perpetual earning machine would not be something that they are keen to learn/invest.  Something/Somewhere sexier would be preferred as the return would be much better in shorter/mid terms. 

---

Just wanted to share also that BW management team is watching vb.com like a hawk.  I think that we should not says too much "bad" things about them.  By my standard, they are doing a good job or at least I really think that they are trying their best and they really thinking that what they are doing is meaningful and contributing +ve to our society. 

If we like to eat hamburger, it's only natural that we wanted hamburger price/cost to drop.  How the price drop, we won't be sure. What we are sure is - it will drop one day.  When the day come, we are the one that's shaking and couldn't pull the trigger.   

---

Let me says something on the timing that I trigger on BW 10 years ago.  If you start reading BW posts from the beginning, valuebuddies were quite active.  Lots of valuations and discussions beyond just this portal. Then the discussion slow down and to almost a stand still. 

Then suddenly, Indonesia tax authority wanted to slap BW with more tax.  I do a quick analysis and felt that the damage (if happen) is not significant and continue watching (with intention to be vested).  

Then suddenly, Indonesia mandate halal for BW products. I was like, ai yo, why you want to challenge the Tax authority? just pay and move on law.  Once I saw how BW management react and handle this curve ball, my confidence go back up again.

Precisely at this point in time, BW was trading below 20cents.  Everyday, I just Q and Q and Q below 20cents.

Good time don't last.  Subsequently, the newspaper reported that someone famous also buying BW and that pushes the price up (which I stopped my market operation). 


 
Gratitude.

[dreamybear]

...Just wanted to share also that BW management team is watching vb.com like a hawk... 

Not sure how you get the info.

Well, the trading volume is getting thin in the last few trading sessions, and there is also a lack of share buyback despite the significant cash holdings.

If the mgmt is reading this, maybe can do something for OPMI to make it "the best is yet to be" ! 

----------------

https://sginvestors.io/sgx/stock/cgn-bes...ce-history

[dreamybear]

With the current share price, BW has once again reached a billionaire dollar mkt cap.
https://bestworld.listedcompany.com/stoc...ntals.html

Of course, the mkt cap fluctuates according to the issued shares / share price, but it has sure come a long way since its dark period of a long suspension & not to mention the dreaded 1.36 number. I wonder which is the major group doing the buying, elevating the share price to the current level - short term traders ? long term investors ? buying based on technical charts ? buying based on fundamentals ? What is the fair market value of the stock, given the rather unique circumstances that it has been thru' and is in ? It is rather disappointing that no analyst is covering the stock after its trading resumption. Perhaps in BW's peculiar situation, one can gain some insights from the share buyback price ?

In any case, this is the stock (business) I am most familiar with amongst my holdings. Although from an OPMI's viewpt I feel some aspects could have been done better, overall it's still a good investment for me, at least so far. *fingers crossed* 

Will BW catch up to Nuskin (market cap/profitability, disregarding currency differences) one day ? Who knows but as long as BW remains one of my core holdings, I certainly yearn for that day, and hopefully it doesn't take too long to fulfil a bear's dream.

----------------

Warren Buffett on MLM's... Are they a Scam? (2013)
https://www.youtube.com/watch?v=l297UcP-gIY

CaseTrust Accredited Business Web Listing 
https://app.case.org.sg/casetrust.plx?rm=results
( Best World Lifestyle (S) Pte Ltd )

Nuskin
https://finance.yahoo.com/quote/NUS/