Analysis on AIRASIA

We will not buy any stock that we do not understand about it. Only buy which company you can understand the company's product and how it make profit.

Therefore, let me list down the reason why i bought AIRASIA and how i understand about AIRASIA.

1)Great management
2)High profitability
3)Leader in the LCC industry
4)It's Brand Name

Let me elaborate the points above.

Great Management

Two years ago, many people don’t like AirAsia. The only reason they choose AirAsia just because it is cheap. The reason they don't like is

-Attitude of its staff were bad.
-The food on flight is lousy.
-It doesn’t assign seat numbers for passengers.
-Delays and cancellations are common.
-Sometimes combined the passengers of two flights into one.

Previously, people has such complains because they are not familiar with LCC. Most of them is first time took LCC Airline. They just compared with MAS with the service, food, assigned seat and etc. However now people has used to it and know about what is LCC Airline.

An important thing which can prove AIRASIA has a great management is reduction of delayed flight. More people now prefer AirAsia than MAS, even when they are on business trip (employers will pay ticket's fees ), because they are fed up with the (infamous) flight-delays of MAS and AirAsia makes their schedules more flexible, because it has a higher flight frequency than MAS. They have more choice for the departure time.

Lets look at the chart below:

AIRASIA that has a consistent punctuality which the customers' respect and build up its name, thus gain a bigger market share in long run.

It has prove that it's management is great. Of course i also have confidence to Tony Fernandes:)

Analysis on KFC Holding Berhad

Financial report
As we know, KFC is a famous fast food restaurant in Malaysia. But KFC Holding Berhad's business is not only KFC restaurants. KFC Holding Berhad's business as below:-

1) KFC restaurants
2) Rasamas restaurants
3) Ayamas retail

Attached here the financial reports of KFC Holding Berhad.

From the report above, we can see that KFCH is negative profit on 2005. This figure has make me curious. Everyone know that KFC restaurant always full of people. How it's profit will be negative?
When i check the numbers of Rasamas retaurant and Kedai Ayamas then i come out a conclusion.

Number of Rasamas retaurants reduce from 31(2004) to 14(2005) that means 17 of the Rasamas retaurants in 2005 was not run well and end up to be shut down.

Number of Kedai Ayamas and Ayams Depots is keep reducing too.

KFCH has lost a lot when it try to expand Rasamas and Ayamas. After KFCH reduce the branches of Ayamas and Rasamas, it has a big increase in it's profit in 2006. Therefore i believe that KFCH will have a stable growth in future.

Competitors of KFC
From few fast food restaurant, only one can really competive with KFC in Malaysia which is Mcdonald. How many Mcdonald restaurants in Malaysia? As on 31.12.2007, only 177 Mcdonald in Malaysia since it's 1st restaurant on 1982. That means average 7 outlets opened per year compare to KFC is average 11 outlets opened per year.

In Malaysia, KFC is top fast food restaurant.

Share portfolio from 14.07.2008 to 12.08.2008

Previously i have mentioned that i deleted TENAGA from my watchlist. The reason as per below:-

1) It is a Government link company.
2) Malaysia's politics is unstable.
3) i am not trust enough to the management of TENAGA.

After i sold out TENAGA, few stocks with good management system is in my mind. i had make a decision to choose two of the stocks in my watchlist. The transaction i made from 14.07.2008 to 12.08.2008 as per below:-

Date stocks name buy/sell units Avg price transact cost
14.07.2008 AIRASIA buy 2000 0.86 14.52
15.07.2008 KFC buy 1000 5.875 32.4
01.08.2008 AIRASIA sell 1000 1.13 14.34
05.08.2008 AIRASIA sell 1000 1.13 14.34
12.08.2008 KFC sell 1000 6.5 36.25

Total investment amount = RM7641.92
Total net profit = RM 1053.16
% of net profit= 13.78%

Why i choose AIRASIA and KFC on this time? And why i sold out them?

Share portfolio from 01.11.2007 to 09.06.2008

From 01.11.2007 to 09.06.2008, i have put all my capital in one share which is TENAGA. The reason i choose it at that time is :-

1) 80% of electricity of West Malaysia is from TENAGA.
2) Other companies difficult to involve in this sector.

Combine the two reason above, TENAGA is nearly monopoly in electricity sector of West Malaysia.

Attached herewith the transaction i make from 01.11.2007 to 09.06.2008.

Date Buy/Sell Units Price
01.11.2007 Buy 500 9.3
15.01.2008 Sell 500 10.1
01.05.2008 Buy 1000 6.7
09.06.2008 Sell 1000 8.5

I have make some profit from the transaction of TENAGA as above. But after i study more, i decide to delete TENAGA from my watchlist. I will share my concern and what stock is in my current watchlist in my next post. Enjoy everyone of investment in KLSE.

Investment road

Hi everyone, i am just a simple guy who interested in investment in Malaysia stock market. I start doing research and study of Malaysia's stock market since i was in Univesity. "Compound interest" these two words really attract me and make me feel how amazing of investment. I read many books about investment. From so many investment tools, i had make a choose which is invest in stock market. Why i choose invest in stock market? Why not property? I have three main reason why i choose share market as my investment tools.

1) Do not need much capital
2) High return
3) Warren Buffet(richest man in the world)

Investment in share market is not a gamble. Therefore, study and researching is very important to make sure you choose a right stock and a right time to invest. Knowledge and experience is important to make you rich.

I has start my investment plan from last year October. The first share i bought was TENAGA. I make a 10% profit for my 1st investment. Which i really satisfy my result of my 1st time. But TENAGA is already not in my watchlist. I will share my investment portfolio from time to time and the reason for choosing this stock in this blog. Hopefully who has any comment or any suggestion, can just leave me a message here, let us discuss and improve together in share market.