KMLOONG IS THE GOLDEN DRAGON RISING UP IN 2H 2020 WITH STRONG FCPO PRICES

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Prices of Crude Palm Oil continue to rise with strength. The FCPO had broken above 3000 mark for OCTOBER delivery. This is a very good price for plantation company because they will be having good profit margin from the high price that they are selling at open market.

Previously I had introduced a few plantation company, all of them had risen up.

You can check THPLANT, recommend at 38 cents, currently trading at 46 cents

Jaya Tiasa (Jtiasa), recommended at 65 cents, currently trading above 70 cents.

Today want to recommend a good company that is doing good at palm oil plantation previously, and also give dividend yearly. 

This company is KMLOONG (KIM LOONG RESOURCES BHD - 5027)

IN CHINESE, THIS COMPANY IS A GOLDEN DRAGON

THIS YEAR IS BEST YEAR FOR PLANTATION COMPANY TO SEE SHARE PRICE RISING UP STEADILY, JUST LIKE A GOLDEN DRAGON AWAKEN UP TO FLY

WHAT ARE THE REASON FOR PALM OIL PLANTATION TO CONTINUE SEEING A BULLISH PRICE THROUGHOUT END OF 2020 UNTIL START OF 1H OF 2021.

1. CHANGES OF WEATHER AFFECT SOY BEAN HARVEST

THE GLOBAL WARMING EFFECT HAD BROUGHT HEAVIER RAINFALL DURING MONSOON SEASON. THE WETTER THAN USUAL RAIN AND STRONGER THAN USUAL WINDS WILL DESTROY CROPS, HENCE DECREASING THE HARVEST OF GOODS.

2. LOCUST SWARMS ATTACK ON INDIA DEVASTATED AGRICULTURE PRODUCTS, INCLUDING SOYBEAN PLANTATION.

3. GROWING DEMAND FROM ORGANIC BROILERS (CHICKEN FARM) PUSH UP NON-GMO SOYBEAN CONSUMPTION

4. INDIA REPORTED A 30% DROP ON GMO SOYBEAN HARVEST

5. CULTURAL FESTIVAL WHICH ARE LINED UP (CHINESE - MOONCAKE FESTIVAL, INDIA - DEEPAVALI, DECEMBER CHRISTMAS) WILL PUSH UP EDIBLE OIL CONSUMPTION FOR 2H 2020.

US SOYBEAN OIL FUTURE

US SOYBEAN FUTURES

WHY KIMLOONG ?

THIS COMPANY DURING LOWER PALM OIL PRICES STILL CAN BE PROFITABLE, AND ALSO PAY DIVIDEND.

THE COMING QUARTERLY RESULT WILL NOT BE TOO BAD, BUT CAN EXPECT DIVIDEND TO BE DECLARED, PROBABLY AROUND 3 CENTS. DURING GOOD TIMES, KMLOONG PAY 6 CENTS DIVIDEND.

THE DIRECTOR ALSO FEEL GOOD ON THE COMPANY OUTLOOK AND CONTINUE BUYING SHARES FOR COMING RESULT AND DIVIDEND.

KMLOONG PROSPECT AND OUTLOOK POSITIVE, AND WILL BE A VERY STRONG DRAGON AT 2H 2020.

ONCE BREAKOUT FROM RESISTANT LINE RM 1.45, KMLOONG CAN GO FURTHER RM 1.60.

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FGV IS ALL YOU NEED FOR GORENG GORENG PLANTATION - FIGHT ALL WAY OUT

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TODAY, A VERY VERY IMPORTANT EVENT HAPPENED IN THE MALAYSIA DERIVATIVES MARKET. THE FCPO (CRUDE PALM OIL FUTURES) HAD OPENED WITH A BULLISH START, AND END WITH A BULLISH NOTE THAT HAD DEFEATED THE RESISTANT LINE OF 2900 WITH GOOD STRENGTH AND VOLUME

THE PALM OIL FUTURES ALSO TESTED ABOVE 12 YEAR LONG RESISTANT LINE, WITH GOOD STRENGTH TO PUSH TOWARDS 3000

SINCE ALL LOW AND MID LINER PALM OIL COUNTER HAD MOVED, ONLY 1 FAVORITE BIG GORENG GORENG LEFT.

THE COUNTER IS NONE OTHER THAN  FGV - 5222

FGV HOLDINGS BERHAD

FGV PRODUCTION OUTPUT FOR CRUDE PALM OIL IS EVEN LARGER THAN IOICORP BY 4 TIMES!!!!

TECHNICAL CHART SHOW FGV IS IMPENDING TO EXPLODE ALL WAY OUT !!!!

1. BASED ON 6 MONTH TREND LINE, FGV IS ON UP TREND, AND WILL BREAK ABOVE DOWN THE DOWN TREND LINE AND TRADE HIGHER

2. FGV GOT CUP AND HANDLE FORMATION, AND BACKED WITH HIGHER FCPO PRICE WHICH REAFFIRM BREAK OUT

3. FGV BREAK OUT FROM TRIANGLE SHAPE WILL BE A UPWARDS BREAK UP INSTEAD OF DOWNWARDS BECAUSE FCPO PRICES ARE ALL TIME HIGH IN 2020

WHERE WILL FCPO BE HEADING TOWARDS IN 2020?

IN 2008, IT WAS ABOVE 4000!!

LET ME BRING YOU SOME PROJECTION FOR 2020

FOLLOWING THE UPTRENDING PROJECTION OF THE FCPO, THE FCPO HITTING 3100 / 3200 RANGE IS POSSIBLE.

FGV IS THE LAST BIG POWERFUL WOLF IN PLANTATION INDUSTRY GOING TO MOVE !!!

FGV LETS GO - RM 1.50 

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THPLANT TO TURN INTO BETTER FORTUNES IN 2020

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More than 10 years back, there is a financial crisis that brought down a lot of big corporate into their knees. If you would recall back, during the 2008, when everything is tumbling down, PALM OIL and SOY OIL had risen so sharply in the global market.

Now more than 10 years after that event, is this event going to happen again? Are you looking at CRUDE PALM OIL heading to a great break out from the 10 years long resistant bar?

HERE IS CHART FOR US SOYBEAN OIL

HERE IS THE LONG TERM CHART FOR MALAYSIA CRUDE PALM OIL

HERE ARE SEVERAL REASON FOR FCPO TO BREAK OUT 3000 IN YEAR 2020

1. INDIA INCREASING IMPORT DUE TO DEEPAVALI CELEBRATION 

2. CHINA INCREASING IMPORT DUE TO MOONCAKE FESTIVAL SEASON

3. EUROPE/US INCREASING IMPORT DUE TO CHRISTMAS SEASON

OTHER FACTORS INCLUDE

1. GLOBAL COUNTRY LOOKING FOR FOOD SECURITY DURING CRISIS PERIOD

2. PALM OIL INDUSTRY BOTTOM UP ON SHARE PRICE AND READY FOR UPWARDS RUN

3. CRUDE PALM KERNEL OIL & PROCESSED PALM KERNEL OIL TAX EXEMPTION ON EXPORT DUTY FROM 1ST JULY 2020 UNTIL 31ST DECEMBER 2020

There are many counter that are interesting. Some are good, some are bad, some are turning good but still at low prices.

The one I see turning good and still in low price is THPLANT - 5112

WHY I THINK THPLANT IS GOOD ?

THPLANT is having a good technical chart reading. The uptrend is supported with better outlook in the overall industry. With FCPO at good prices, and THPLANT at the lowest price region in the past 10 years, it is not too bad a gamble with calculated risk.

Comparing with other peers around the similar size, THPLANT FFB production is considerable good. 

Now THPLANT is already fully impaired. Although THPLANT have a large debt pile, the lower interest rate will be beneficial with lower interest servicing. A lot of analyst will be expecting a further cut in the coming BNM policy meeting.

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TSH BENEFIT FROM HIGH FPCO AND TIMBER PRICE, BACK WITH EPF PURCHASE FOR A GOOD UPWARD SWING

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Today glove industry stage a nice rebound, with multiple limit up coming back to the market. Market sentiment will continue to be strong with ample of volume.

I do not need to introduce gloves industry counter anymore, because it is known to everyone. Today want to highlight a potential company - TSH RESOURCES BHD (9059)

This company main business is palm oil plantation, including milling and refinery services. Other business is cocoa, biomass energy and timber (wood) business.

Primary revenue contribution is from operation of Palm Oil Plantation, and then follow with Timber sector (wood).

3 MAIN POINT THAT PUT TSH AS AN ATTRACTIVE COMPANY

1.) FCPO PRICES HAD BEEN CONSOLIDATING AT 2800 FOR MORE THAN 1 MONTH. LOOKING TO PUSH ABOVE 3000 WITH MORE BUYING FROM INDIA, EUROPE AND CHINA TO RESTOCK

FCPO projection can go above 3000 with supported buying from INDIA, EUROPE and CHINA as government restock on this commodity

https://www.reuters.com/article/malaysia-palmoil/update-1-industry-body-expects-q3-rise-in-malaysian-palm-oil-exports-to-biggest-buyers-idUSL4N2DO1YR

2.) LUMBER FUTURE ALL TIME HIGH, BENEFIT TSH TIMBER CONCESSION

TSH got 100 years concession for sustainable timber plantation. A few years ago, TSH privatized Ekowood, a company that manufacture timber flooring products. The product are supply to local and international market.

High timber price will give TSH a better margin.

https://www.ekowood.com/en/inspirations/malaysia-projects/

3.) EPF AGGRESSIVE BUYING OF TSH FROM OPEN MARKET

The past 30 days, EPF had accumulated approximately 2% of TSH shares. This I believe is due to the positive outlook from higher palm oil and better margin from timber division.

TSH technical chart is giving good entry point. Current trend look set to see TSH is heading for uptrend, with positive news from industry. The current price is at technical low side, and can point towards potential upward swing.

Can target for a mid term RM 1.20

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WTK RIDING HIGH WITH THE ALL TIME HIGH LUMBER PRICE, BACK WITH UPRISING FCPO PRICE

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Today want to introduce a stock which is overlooked, due to the market attention that is all focus on gloves, vaccine, gold primarily. Malaysia is a diverse market, not only good in gloves, vaccines and gold. There are other important commodities that Malaysia export to such as Palm Oil, Timber/Lumber.

The retail perception of these timber / lumber commodity is that during the MCO lockdown, demand of such goods will fall. Surprisingly, the demand for LUMBER had sky rocketed into all time high (highest in the history) as the lock down force US/EUROPE citizen at home, they are looking into renovating their own house, and doing up repairs that are needed.

This had put up a surprising demand from the lumber operator, where most lumber operator thought demand will not be good, hence reducing output.

The situation now is high demand and low supply, pushing LUMBER FUTURES to all time high in history

So, what can this mean for lumberjack operator in Malaysia?

In Malaysia, those involved prominent ones that are involved in lumber chopping are FLBHD, WTK, SUBUR, JTIASA. 

WHY I CHOOSE WTK ?

Of all, the company with most liquidity is WTK - 4243. That is the reason WTK will perform better than the rest due to availability of liquidity for investor.

At the current market, investor/trader/IB will prefer to trade on company with liquidity. Although FLBHD is going to benefit, but the liquidity of shares will shy away big investor.

WHY WTK CAN BENEFIT IN A DOUBLE KILL MANNER?

There are a few operation under WTK, namely LUMBER, PALM OIL, MANUFACTURING OF TAPES.

Of all, revenue is 70% from LUMBER, 15 to 20% from PALM OIL, and the rest at manufacturing.

The drastic increase in LUMBER LOG price will give WTK a JACKPOT WINDFALL towards it's existing stock pile inventory.

Another benefit that WTK is getting is improving FCPO prices. FCPO predict to hit above RM 3000

As you can see, during crisis time, different country will want to stock up their important supplies. India is going to continue purchasing palm oil, europe as well and China. All these will be pushing CPO towards 3000 and beyond.

WTK CHART STRONG BREAKOUT WITH POSITIVE VOLUME

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WTK recommended at 11th AUGUST 2020 at baseline price.

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