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Friday, 20 September 2013

My Stock - HUAYANG (5062)


How HUAYANG fulfils my stock selection criteria?
1) Annual Dividend Yield 7% based on my average price of RM1.54
2) Business has been growing up for past 3 years (from 2010 to 2012)
3) ROE > 10%
4) However, like most of the property counter, it is not a net cash company which means it has more debt to cash.

I accumulated HUAYANG (5062) in Oct 2012 with average cost RM1.54 and i kept it till today.


HUAYANG is a very good fundamental company even though it is not in a net cash position and it has a lot other advantages as below:
1) Dividend Payout for past few years around 25%
2) HUAYANG is the well known developer in building the affordable house. The group's motto is "Affordable homes for all". This is one of the reason why i like it as the demand of the affordable house is the broadest and most resilient.
3) HUAYANG has a good management team and leading by a young CEO, HO WEN YAN. He is confident to lead the company to a higher high. He has set an internal goal to achieve RM500mil revenue in FY2014 and RM800mil in FY2018.
4) HUAYANG is one of the few companies in KLSE that issued bonus for 3 consecutive years, i.e. 2010, 2011 & 2012.

Back to 2012, the reason i bought HUAYANG is because of its business has been growing up well since 2008 and its attractive dividend yield almost 8%.


 Also, its main project, ONE SOUTH in Sri Kembangan received overwhelming response at the time of launch. Besides that, as outlined in the annual report 2012:

"Our goal is to achieve a revenue of RM500
million in FY 2014
. With 30 years of
experience, and our corporate mission
geared towards affordable housing, we
have full confidence that our affordable
products will continue to fare well."


With this, i was confident that HUAYANG will be doing much better in the coming years.

My Investment Result
I almost double my initial capital, this is not included the RM0.12 dividend that i received in 2012. Also, my holding quantity was enlarged by the issue bonus 2012 and will be enlarging again by the coming issue bonus 2013. Again, this proved that being a long term investor is the right way to build and protect our money :).

About Future
Since it posted a bad result in Q1 of 2014, I will keep eye on the coming next quarter which is Q2 of 2014 to see if the initial goal of RM500mil revenue set by management will be achieved. Being a long term investor is not just buying the stock and then forgets about it. We need to always keep track how the company performs from time to time. We can choose to sell our holding if the company no longer performs as expected.

2 comments:

  1. I like your analysis , can you add me into your blog list?
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    I am new to this. Hope to share and learn more from you. Thanks.

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