Investment Idea - Dec 2010

Dear investor,

Sugar, Petrol and Gas price going to increase again, meaning another round of inflation is coming, we can benefit from our investment as well!
Choose the Industry leader that going to benefit the most among the same industry! Never buy the industry loser. (the loser can go burst anytime)
For example, AirAsia and MAS was showing good result, then we can consider invest in AIRPORT. (just check the price of AIRPORT, it already more than double since last year)

Another example, sales of vehicle improved, UMW, Honda, Toyota, Proton all shown good result, but all cars need to pay for TOLL company, hence we can consider PLUS.
This is the idea of how we choose best of the best. (I am writing this not to tell you to buy AIRPORT or PLUS right now, it just example how we set the investment strategy)

Last week, CIMB research mentioned about KLK, a leader in Palm Oil industry. There are many points mentioned on the research report, you may refer the attachment. If I were to invest in KLK, I will buy Batu Kawan instead of KLK. The reason is because Batu Kawan hold 46.57% of KLK, meaning:
1 BKAWAN share = 1.1628 KLK share + “Others Assets” 

Batu Kawan price at RM16.30 as of last Friday, KLK is RM21.38. Hence, Batu Kawan having great value than KLK. What happen if Batu Kawan share price going down? For sure I will buy more if the price fall below RM16. (never buy the stock if you dare not buy more when the price go down, it's the indication you don't understand the company or not choosing the great company)

p/s: this is not recommendation to buy any stock, the intention is to show the way of choosing great business, as many just choose the cheap instead of choose the value! I plan to invest in Batu Kawan and keep it for 3 years!
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