The Economic Transformation Programme (ETP) - A Roadmap for Malaysia

Resulting from the results and targets of the 1,000-person workshop and 500-person laboratories orchestrated by the Performance Management and Delivery Unit (PEMANDU), Najib has launched the Economic Transformation Programme (ETP): A Roadmap for Malaysia on 25 October 2010.

The ETP contains action plans, hopefully will transform Malaysia into a high-income nation by 2020. This is charted by lifting Malaysia’s gross national income (GNI) per capita from US$6,700 (RM23,700) in 2009 to more than US$15,000 (RM48,000) in 2020. In order to achieve this target, GNI need to continuously grow at the rate of at least 6% per annum.

The ETP is planned to be driven by 12 National Key Economic Areas (NKEAs) announced in the 10th Malaysia Plan, which are:

• Oil, Gas and Energy
• Palm Oil
• Financial Services
• Tourism
• Business Services
• Electronics and Electrical
• Wholesale and Retail
• Education
• Healthcare
• Communications Content and Infrastructure
• Agriculture
• Greater Kuala Lumpur/Klang Valley

It seems that areas ruled by MPSJ, including Subang Jaya, USJ, Bandar Sunway, Puchong, Kinrara, Seri Kembangan, etc. will be at the heart of Greater KL, and hopefully will be greatly benefited from the plan.

However, the planned MRT system under Greater KL, where the Red Line linking Damansara to Serdang, and the Green Line linking Kepong to Kajang, seems to have bypassed the heart!

Under the ETP, 131 Entry Point Projects (EPP) and and 60 Business Opportunities (BO) were planned, spanning across the 12 NKEAs. They include:

• Expanding the production of swiftlet bird nests (燕窝)
• Seaweed farming in Sabah
• Mushroom project
• Establishing dairy clusters in Malaysia
• Growing aviation support services
• Building globally-competitive outsourcing services
• Data centre and green technology
• Islamic financial services
• Launching EduCity @ Iskandar
• Solid state lighting (SSL)
• Home appliances and semi-conductors
• Solar energy
• Developing health metropolis
• Connecting to Singapore via a high-speed rail system
• Deploying nuclear energy for power generation
• Building a regional oil storage and trading hub
• e-Healthcare, e-Learning and e-Government
• Positioning Malaysia as a duty free shopping destination for tourist goods
• etc.

Click here to go to the download page of The Economic Transformation Programme: A Roadmap for Malaysia

A furniture stock called LIIHEN

There are plenty of furniture stocks listed in Bursa Malaysia, including the recently listed HOMERITZ. Most of them are majoritically doing export business, and hence, furniture stocks are known to be cyclical and buoyed by the worldwide economic sentiment.

You would probably not be interested in furniture stock at the moment, especially when the Ringgit is going high against USD, which is not so good for export industries. However, there is one called LIIHEN (7089, 利兴) which attracted my attention.

Located in Muar the "furniture town" in Johor, Lii Hen has been around for decades since 1985, and now their furniture plants spans across an area if approximately 30 acres, undertake the full range of wood-based manufacturing activities from timber processing up to manufacturing and packaging of finished goods.

This is their corporate structure:

The boss, Mr Chua Lee Seng (蔡利成) has been active in local, state as well as national level of furniture associations, and has taken significant roles including executive advisor of Muar Furniture Association, president of Federation of Johore Furniture Manufacturers & Traders Association, etc.

Lii Hen was first listed in 2nd Board in April 2000, and transferred to Main Board in 2002. Most of the time, Lii Hen was a dull counter, except once been "goreng" around October 2004. However, it shows remarkable fundamental improvement since 2009, despite the global economic downturn.

As you can see, from 2009 onwards, its EPS surges, boosting its ROE to above 15%. And then, Lii Hen paid dividend every single quarter. If this is sustainable, it would become a dividend stock too.

Note that there was a fire incident on 28 October 2009 night at one of their main premises, and it was covered by insurance. The fire caused the total loss of buildings, inventories, plant & machinery and factory equipments amounted to RM8.3 million. The fire had caused lost of sales in 2009 Q4, and you can see that quarter has some figures gone red in the table above.

Anyhow, Lii Hen started to show better result a few months prior to the fire incident. After the fire, they promptly recovered and resume the up-trend again, as the disruption of the production capacity due to the fire incident occurred in the preceding quarter had been fully restored at rented premises in 2010 Q1. You see another red in the net profit of 2010 Q2 "due to the erosion of profit margin resulting from the depreciation of USD against RM".

Based on its closing price of RM1.23 on 9 November 2010, and using the figure of its rolling quarter:

• PE = 1.23/0.35 = 3.51
• DY = 0.145/1.23 = 12%

That's why it attracted my attention.

Click here to visit the website of LIIHEN.

Disclaimer: This article is intended for sharing of point of view only. It is not an advice or recommendation to buy or sell any of the mentioned stock counters. You should do your own homework before trading in Bursa Malaysia.

How to make your boss like you

The November 2010 issue of Personal Money magazine has an article titled "9 Ways To Get Into Your Boss' Good Books" which I believe is very advisable for all employee to read, understand and practise in order to excel in their career.

The 9 tips to let your boss like you are:

• Make your boss look good
• Understand your boss
• Understand your boss' expectations and do more than is expected of you
• Provide solutions rather than problems
• Working independently on the job
• Make your time count
• Communicate with your boss
• Watch your code of conduct
• Showing positivism in your life and work

Beside that, the following are something usually done by employee to please their boss, but might not work at all:

• Trying to look productive but nothing is happening
• Making your boss look good in the wrong way
• Tripod-ding and apple-polishing
• Working overly independent of your boss

For detailed explanation of all the above points, grab yourself a copy of November 2010 Personal Money magazine and read through page 59-61.