KOON Yew Yin, a name that needs no introduction in the Malaysian stock circle – especially so among the retail investor fraternity – is akin to the English football club Manchester United: either you like him or you hate him.
People who look up to him would regard him as a strategic genius to the extent of an investor extraordinaire – the Malaysian equivalent of Warren Buffet.
Haters will remember him for the mega losses they amassed for either jumping into the bandwagon a tad too late or for getting blinded by paper gain so much so they forgot that the gravy train has left them behind.
Having been in the hiatus for a short spell following the consolidation of his favourite rubber glove stock Supermax Corp Bhd (a similar fate impacted all the Big-Four glove makers), Uncle Koon as he is fondly known is back – and this time being ‘perceived’ of promoting LB Aluminium Bhd.
His viewpoint entitled LB Aluminium is Much Cheaper than Press Metal & PMB was uploaded onto the popular I3investor portal at 7.55pm on Sunday (April 11).
To be fair to Uncle Koon – unlike the case of Supermax – he is not advocating a “buy” call on LB Aluminium but merely drawing a comparison between three aluminium product manufacturers, namely LB Aluminium, Press Metal Aluminium Holdings Bhd and PMB Technology Bhd.
“LB Aluminium is selling at PE (price-to-earnings ratio) 5 while Press Metal is selling at PE 71 and PMB is selling at PE 27,” he wrote.
“That is why LB Aluminium share price is shooting up because it is selling so much cheaper than its competitors.”
Let’s not assume – or try to read in between the lines – that Uncle Koon’s last statement is a hint to snap up LB Aluminium especially given that market regulators are very now very stringent with the rendering of investment advice.
Recall that on Dec 30 last year, the Securities Commission (SC) in its latest Guidance Note on Provision of Investment Advice noted that it is more likely to consider discussions on specific stocks on blogs, forums or other social media as an investment advice if they involve the provision of recommendation or opinion which may induce readers to take an action regarding the specific stock.
“Any person carrying on a business of giving investment advice without a license commits an offence under the CMSA which is punishable with a fine not exceeding RM10 mil or imprisonment not exceeding 10 years or both, if found guilty,” warned the SC.
Scrutinising his latest article thoroughly, this writer is of the view that in the name of fairness, Uncle Koon is not issuing a “buy” call except making some obvious comparison to justify the recent uptrend in the share price of LB Aluminium.
A check of LB Aluminium price trend shows that the counter started to trade with hefty volume effective March 31 with 16.32 million shares traded while its share price only picked up by 2.5 sen or 3.42% to 75.5 sen.
Its biggest rise en route to its current level of RM1.20-RM1.30 took place on April 8 when the stock shot up 21 sen or 20.59% to RM1.23 with 27.62 million shares traded.
Fair enough, however, Uncle Koon’s article in I3investor could have sparked a flurry of trading frenzy yesterday (April 12) as LB Aluminium added another 10 sen or 8.33% to RM1.30 with 26.5 million shares exchanged hands.
Anyway, to another school of thought if Uncle Koon could have bought into LB Aluminium much earlier (even prior to March 31) when the share price was in the 70 sen region, that is another issue altogether.
At 11.17am, LB Aluminium was down 6 sen or 4.62% to RM1.24 with 5.45 million shares traded, thus valuing the company at RM308 mil. – April 13, 2021
