Sunday, April 03, 2016

CBIP Slow but Steady

The FBM KLCI closed at 1750 on 24.12.2013. Last Friday 1.4.2016, it closed at 1711. This means the market had dropped 39 points or 2.23% during this period.

Via my post dated 24.12.13 in my blog, Wisdom Wise, I recommended CBIP as a good stock to buy and keep at RM3.20. 

Last Friday, CBIP closed at RM2.28. In year 2014, it gave a bonus issue of 1 for 1 and free warrants of 1 for 3 after the bonus issue. The warrants were last traded at 47.5 sen per warrant. Factored in the dividends paid during this period. it works out that for every 1000 shares you bought at RM3,200 the value of it would have gone up to RM5,013. This means an upside of 57% in 2 years & 3 months. Although this is short of anything fantastic, it has beaten the market by a big margin, hands down. 

What’s in store for CBIP? In the 4th quarter of 2015, EPS came in at 7.42 sen. In the corresponding quarter of the previous year, EPS was 4.14. This is up 79%!  Not bad by any standard.

As at 31.12.2015, some key statistics & metrics of CBIP were as follows:

Current assets: RM421.88 ml
Current Liabilities: RM154.08
Current Ratio: 2.738
Cash RM196.91 ml
Share Capital RM269.124
Total shares issued 538.248 ml (Par Value 50 sen per share)
Borrowings RM19.728 ml
Total liabilities: RM154.079 ml

From the info mentioned above, it can easily be seen that the stock has a strong balance sheet with cash alone enough to cover its total liabilities. 

The management in its filings with Bursa has indicated that the planation sector of the group is likely to add profits to its bottom line in 2016

I expect that its 1st quarter ended 31.3.2016 to be commendable, and that 2016 would be a great year for the stock. 

TA-wise, the chart shows that the stock is in a gradual uptrend. The special dividend of 4 sen paid on 15.3.2016 is a harbinger of better things to come. 

Investment is never without risk. Anything can happen. You buy, sell or hold at your own risk absolutely. 

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