FED-UP or frustrated with the ill health of the local bourse in recent times, investor extraordinaire-cum-philanthropist Koon Yew Yin a.k.a Uncle Koon is ‘temporarily’ quitting the stock market.
“Since I am holding cash, I am not in a hurry to buy back stocks,” he pointed out in his latest blog. “I know patience is the key to successful investment. I do not want to take unnecessary risk. Currently, we have MCO (movement control order) and also political uncertainty. Who will be the next Prime Minister?
The 88 year-old who is often touted as the Malaysian version of Warren Buffet – or one man institutional fund – recently shared the taste of humble pie when he admitted that his ‘newfound’ love with steel stocks – and Leon Fuat Bhd in particular – has not been bearing the desired fruits.
“Recently the number of COVID-19 cases was surging so fast that our Government started to impose lockdown and mandatory MCO. During MCO all workers cannot go to work in Leon Fuat and many other companies,” justified Uncle Koon.
“As a result, I can foresee that Leon Fuat will report reduced profit in the next quarter ending June 2021. That is why I posted three articles to explain why I have cashed out of the stock market.”
Uncle Koon claimed that he started to buy aggressively into Leon Fuat until 80% of his stock holdings was Leon Fuat about six weeks ago when he saw the steel counter selling below RM1 with its latest earnings per share (EPS) at 11.65 sen for the quarter ended March 31, 2021 while its price-to-earnings ratio (PE) stood at only two times.
‘False alarm’
Earlier on Sunday night (July 18), Uncle Koon ‘cheekily’ sent out a shocker which gave the impression that he is quitting for good, prompting FocusM to double check with him whether he was sure with his intention.
“Tonight I am celebrating my retirement from the stock market. I am drinking my last bottle whisky called Queen Margot which is the best whisky in the world. You can Google to confirm what I said,” he said on his WhatApp posting.
Apart from Leon Fuat, other stocks that are closely associated with Uncle Koon in recent times include Supermax Corp Bhd, Dayang Enterprise Holdings Bhd, JAKS Resources Bhd, Latitude Tree Holdings Bhd, Lii Hen Industries Bhd and VS Industry Bhd, Gadang Holdings Bhd and Hengyuan Refining Co Bhd.
Of the named stocks, recall that Uncle Koon was locked in a fierce battle with JAKS after both he and his wife Tan Kit Pheng (main pic; left) mopped up large quantity of the stock, only to be subject to forced selling in view or margin calls when the price of JAKS started to plunge after touching a high of RM1.85 in February 2018.
“Based on our average selling price of 80 sen, our average purchase price of RM1.20 per share and our total holdings of 160 million shares, we have lost RM64 mil,” he noted in a blog posting dated Dec 8, 2018. ‘This is my most expensive lesson in my life.”
Price pressure
Fast forward to current times, Uncle Koon is engaged in a bit of friction with fellow stock market guru/pundit Ooi Teik Bee who has recently offered “21 reasons” for buying into steel stock Hiap Teck Venture Bhd.
“MCO is restricting the movement of everybody. Workers cannot go to work for Hiap Teck. Even if Hiap Teck can produce some steel products, building contractors will not buy Hiap Teck’s products because construction workers cannot go to work,” opined Uncle Koon.
“Unfortunately, Mr Ooi Teik Bee does not agree with me. To spite me, he continues to criticise me in i3investors forum. He is entitled to his opinion and I am also entitled to my opinion. Only time can tell who is right and who is wrong.”
As such, Hiap Teck’s will continue to face depressed share price just like one of the 10 steel companies namely Leon Fuat, Choo Bee Metal Industries Bhd, Mycron Steel Bhd, Prestar Resiurces Bhd, Leader Steel Holdings Bhd, Melewar Insustrial Group Bhd, Tashin Holdings Bhd, Astino Bhd and CSC Steel Holdings Bhd.
“I will start to buy back Leon Fuat and other stocks when there is no more MCO and when workers can go back to work,” added Uncle Koon.
Despite turning his back on the stock market, Uncle Koon assures that he is not taking a back seat from his noble philanthropic act of sponsoring poor and deserving students as he still has hoards of spare cash to spare the needy. – July 20, 2021
