Why Singles Aren't Getting Married?

Dr. Tom and Dr. Beverly Rodgers in the book titled The Singlehood Phenomenon identify what they called "top ten brutally honest reasons people aren't getting married".

1. Skepticism about love and marriage
2. Lack of faith in God's provision
3. Unresolved issues from the past
4. Confusion about the rules (of dating/courtship)
5. A poor understanding of the purpose of marriage
6. Fear of getting hurt
7. Wanting the perfect mate
8. Not dealing with prior heartbreak
9. An unbalanced emphasis on career (wanting to get established before getting married)
10. Concern that their marriage will fail

Worthy Mate

Karen Kingsbury in A Time to Dance

"Female eagles like to test their male counterpart. When the female knows a male is interested, she leads him on a chase through the skies, swooping and diving and soaring high above the hills. When the chase is nearly over, she flies as high as she can and flips onto her back, free-falling toward the ground. It is the male’s job to place his body over hers and grasp her talons, flapping his wings with all his might to keep her from certain death. Moments before they hit the ground, the female pulls out of the dive and circles the male. Because he had been willing to stay even unto death, he will have proven himself as a mate. The eagles are joined for life from that point on."

Sector Picks

Empirical research shows that stock returns depend as much as 50% on sector selection(theme), 30% on market trend, and only 20% on individual counters. As such, selecting a right sector to invest at the right time will decide your stock returns eventually. Undoubtedly, oil and gas, construction and property sectors are in the limelight at the moment.

Oil & gas sector - Eastern Corridor Economic Region, to be announced soon.

Construction & property sector - Northern Corridor Economic Region, to be announced by Prime Minister this coming Monday.


(AmResearch : Riding on Petro Dollar Boom)

Investment highlights as appeared in the www.theedgedaily.com - 19 July 2007

We are retaining our bullish stance on the sector. Admittedly, share prices have rallied and valuations have expanded but we see ample room for sustained price movement.

First, momentum of contract awards will get stronger over the next six months. Expect an estimated RM13b (1H2007 : RM5 billion, 1H2006 : RM2.6 billion) worth of contracts from the Kimanis project, installation of pipeline contract, deepwater fields development and award of multiple overseas projects.

Second, while offshore activities have gained traction, we have seen a resurgence of onshore oil & gas (O&G) projects. Nevertheless, no physical work has started so far, and we remain skeptical on some private initiated projects which is a tad too ambitious. The potential unveiling of Eastern Corridor development by Petronas will however, strengthen the flow of downstream projects.

All in, demand from both offshore and onshore projects will further harness the deep values of O&G asset owners, specifically those with fabrication yards. Fabricators and EPCC contractors stand to benefit the most as the splurge in onshore projects has further intensified demand for their services.

Third, we have seen nascent signs of mergers and acquisitions (M&A) activities which should gain traction as capacity shortfall, strong demand and rising rates prod companies to acquire. Companies with O&G assets and experienced personnel will be prime targets, as witnessed in Seadrill's acquisition into SapuraCrest. To be sure, Brooke Dockyard's 20-acre yard is also of interest to O&G players.

UMW is our top sector pick, trading at an implied O&G PE of 10x for its fast growing O&G earnings, we believe the market has not fully appreciated its O&G business.

We initiate coverage on Kencana and Dialog Group with a "buy" call given re-acceleration in their earnings cycle.

Besides strong operational performance, we believe Coastal Contract and Alam Maritim are next in line to unfold strategic propostions. Wah Seong is working on plant expansions to meet upcoming surge in pipe-coating projects.

We continue to like KNM for its strong earnings CAGR of 47% and impressive deliverance track record. We are also issuing a "buy" call on Petronas Gas. We have, however, downgraded Ramunia from buy to hold given uncertainties following its recent cost dispute with Carigali PTTEPI.

In our O&G sector report released in March 2007, we highlighted that contract flow momentum for the industry will get stronger over the next 12 to 18 months, with contract size getting larger as O&G fields progress to the capex-heavy development stages.

This will accelerate demand for O&G assets and reaffirms our opinion that the prime beneficiaries of this upcycle will be O&G assets owners, given that supply available remains tight.

We also believe that mergers & acquisitions may be unfolding prodded by 1) the need to acquire assets, capacity and extend market presence and 2) undercapitalised balance sheets.

Share prices have rallied
In the last three months, share prices of O&G companies have rallied on the back of contract awards and positive macro news flow. The rally was supported by contracts secured, expectations of sizeable upcoming projects and most importantly, solid earnings deliverance.

Listed O&G companies' 1QFY07 results registered solid sequential earnings growth. During the recent reporting season, we saw numerous upward revision in earnings forecasts and target prices. Thus far, earnings expansion have kept pace with the rise in share prices, leaving valuations still attractive.

The O&G companies are also making headways overseas, further underpinning our bullish conviction on the sector. Over the last three years, local O&G companies had actively embarked on the acquisition of businesses and technology and formed strategic alliances to upgrade and enlarge their products and services offerings.

Hence, we are now beginning to witness higher overseas earnings and rising bids for overseas projects.

RM5 billion worth of jobs in 1H2007
Contracts worth about RM1.8 billion were awarded over the last four months bringing the total to RM5 billion in 1H2007, almost double (92% higher) the RM2.6 billion worth awarded in 1H2006.

Offshore O&G activities were indeed very active. But, there were also several significant announcements of major onshore O&G projects by both Petronas and non-Petronas backed companies. The aggregate value is estimated to be RM28 billion although some of these projects may not take off.

These include:
1. Petroleum products storage facility off Tanjung Bin (PTB), estimated at RM1.4 billion,
2. Trans-Peninsula pipeline project across Kedah to Kelantan, estimated at US$7billion or RM24billion. This is an ambitious project which we believe would be difficult to execute;
3. Dialog and Transfigura's onshore tank terminal and centralised tankage facility in Port Tanjung Langsat (PTL), estimated to cost at least RM0.72billion; and
4. Storage facility by Perstine Oil (M) Sdn Bhd, estimated at RM1.8 billion.

Petronas may be unveiling development plans for the Eastern Corridor which will likely include O&G projects. This is because this corridor is located near rich hydrocarbon reserves and is currently a base for gas processing and petrochemical plants.

Our conversation with industry sources also revealed that a new refinery off Kedah could potentially be constructed by SKS Development. While the slew of macro announcements have indeed stirred interest on the sector, it remains to be seen whether these massive projects will materialise.

Early signs of mergers &acquisitions
We also saw nascent signs of M&A taking place:
1. Seadrill Ltd's substantial stake of 12% in SapuraCrest Petroleum (SapCrest). This is in line with our view that companies with O&G assets are good candidates for acquisition in the current O&G run and tight supply situation; and
2. Naim Cendera's acquisition of a 45% equity stake in Dayang Enterprise Group. Dayang currently owns two marine vessels and one support vessel. Besides O&G assets, Dayang is also a Petronas licence holder and would provide the Naim group a foothold to bid for Sabah-Sarawak O&G assets.

Strengthening balance sheet for growth
In the last three months, we saw O&G companies proposing capital raising exercises: 1) to fund expansion plans, 2) to strengthen balance sheet to take on larger jobs and 3) to address high gearing.

The capital raising exercises include:
1. Issuance of RM600m Islamic securities by Alam Maritim;
2. Private placements by Alam Maritim (45 million ordinary shares), Wah Seong (54 million), Ramunia (45 million) and Coastal Contract (34 million). All in, capital to be raised could amount to RM350 million to RM400 million; Restricted issue of 68m shares at indicative issue price of RM1 per share by Ramunia; and
3. Petra Perdana's proposed spin-off listing of Petra Energy, its integrated brownfield services unit. Planned issue of approximately 46m Petra Energy shares would raise an estimated RM115 million.
Kencana Petroleum and Dialog Group, in our view, would be next in line to embark on capital raising exercises.

Kencana, possibly in preparation of huge contract flows coming onboard, especially with plans to fabricate drilling rigs, while Dialog would require funding for contruction of centralised tankage facility and tank terminal in PTL, Johor.

Driver over the next 12 months
Contract awards are expected to swell over the next 12 months, underpinned by an estimated RM13 billion worth of contracts expected to be dished out. These include the Kimanis project, installation of pipeline contracts, contracts from development of deepwater fields (RM3.5 billion to RM5.5 billion per O&G field) and award of multiple overseas projects bid by local O&G companies Size of these contracts are at least twice the size of contract awards totalling RM5 billion over the last six months.

Kimanis, Sabah gas terminal project
The Kimanis, Sabah gas terminal project had some headstart over the last three months. About 15-20 companies have formed consortiums to bid for the project. So for, only pre-qualification bids have been submitted by the consortiums comprising of both local and international companies.

We understand tender for construction of the gas terminal in Kimanis has been issued whilst tender for supply, construction and laying the 500km onshore pipelines would be issued some time in the coming two months.

According to industry sources, the contract value for construction and commissioning of the terminal is estimated at RM1 billion while the 500km pipeline from Sabah to Bintulu, Sarawak is estimated to cost about RM2 billion to RM2.5 billion.

The entire project is estimated to cost about RM5 billion (including pipelines or transportation of O&G from offshore Sabah). We estimate that about RM1.5 billion to RM2 billion per annum would flow through the sector from 2008 to the first half of 2010.

Pipelaying contract for offshore Malaysia
Contract for installation of pipelines (pipelaying) from Petronas, Shell and ExxonMobil is likely to be announced in 3Q2007. Contract size would be at least RM3 billion according to industry sources. The previous contract worth RM2.0 billion expired at end-2006.

We expect overseas contract newsflow in the coming months to further sustain buying interest in the sector :
1. Wah Seong Corporation's ("Wah Seong") potential bid for pipe-coating project in Europe and China;
2. Ramunia Holdings Bhd ("Ramunia") recently entered into a collaboration with Punj Lloyd to bid for projects (potentially worth up to US$1 billion or RM3.45 billion) in Mumbai High North Development, India. A maiden bid has been submitted for the development. The group's aggregate contract bids todate amounted to RM9 billion and more than half are international jobs;
3. Alam Maritim has submitted bids for offshore vessel chartering services contracts with Saudi Aramco. The group is awaiting the results currently; and
4. SapuraCrest is forecasting overseas revenue to hit about 30% of group turnover in FY08F versus 15%-20% in FY07. The group will be more active in bidding for international jobs once Sapura 3000 and the Derrick lay barge are commissioned in 2008. Onshore projects to lift sentiment and earnings

Besides burgeoning orders and contracts from exploration, development and production activities offshore, Malaysia O&G companies especially engineering, procurement, construction & commissioning ("EPCC") contractors and process equipment fabricators are receiving further boost from the recent emergence of onshore oil, gas and petrochemical projects in Johor and Northern Corridor and potentially the Eastern Corridor Development.

O&G asset owners are still the best leverage to the upcycle
We are more convinced that O&G asset owners are best leverage to the current upcycle. This is especially so for fabricators which owns fabrication yards.

Fabricators, yard owners and EPCC contractors
Rising demand for offshore platforms, floating production units, floating production storage and offloading (FPSO), drilling rigs, offshore marine vessels, process equipment coupled with the recent resurgence of onshore oil, gas and petrochemical facilities locally (storage facility, terminal, centralised tankage facility and refineries) have and are building demand for fabricators and fabrication yard

Fabricators with proven delivery track record are poised to register burgeoning order book and earnings.

EPCC contractors with both offshore and onshore capability are in an even better position such as Kencana Petroleum.

Strategic alliances would spur stronger growth. Listed O&G companies with strong strategic alliancessuch as Dialog, KNM and to a certain extend Kencana and Ramunia, we believe, would be in a stronger position to outperform and strengthen penetration overseas.

M&As in the making
In our opinion, M&As among O&G companies would emerge more strongly over the next two years. Corporate developments such as Seadrill's shareholding stake in SapCrest and Naim's acquisition of Dayang todate we believe, is only the tip of a huge iceberg.

From our talks with industry players, we conclude that O&G companies with assets and experienced O&G personnel will be prime targets, a case in point is Seadrill's recent move.

To further prove our point, we hear that Brooke Dockyard's 20-acre fabrication yard is currently of interest to a local O&G company and a potential acquisition is said to be forthcoming.

The industry is likely to witness more foreign companies taking strategic stakes in local oil & gas companies, we understand that numerous proposals have been made to local O&G companies. Coastal, Alam Maritim, Kencana and Ramunia are among the few that have received proposals over the last months for various joint collaborative efforts and for strategic stakes.

We strongly believe Coastal and Alam Maritim would unfold corporate developments over the next 12 months and could potentially involve a foreign company taking a strategic stake. This would alleviate Coastal and Alam Maritim's valuation and prospects.

Diversification

One of the major issues in constructing a winning stock portfolio is diversification. At first glance, we tend to see diversification as in selecting different kind of stocks in our stock portfolio to hedge against unsystematic risk. This is not entirely the case.

We should treat diversification at a more profound level as in diversifying our investment over different time horizon -- meaning to invest at different time even it's the same stock that we had previously put our money in. Say, you have 10k to invest, and you really like to invest into a particular counter that promises bright future prospect. Even the counter looks cheap now, you should not put all 10k into that counter at the same time. Just make a partial investment. If the counter rises some more, good. Your previous investment is making money now. Buy some more. If the counter drops, even better. You get a cheap sale for that counter.

So the conclusion is that we should diversify not only in different counters, sectors, or financial instruments. But also at different time even for the same counters, sectors, or financial instruments.

Walnut Chocolate Chips Brownies

Ingredients:

1. 280g dark chocolate

2. 110g unsalted butter

3. 1 tbsp cocoa powder

4. 100g brown sugar

5. 2 eggs

6. 70g plain flour (sieved)

7. ½ tsp vanilla extract

8. 150g walnut (chopped)

9. 50g chocolate chips

Steps:

Lightly grease a 20cm x 20cm baking tin and line with baking paper, hanging over two sides. Melt dark chocolate and butter over a simmering water using double boiler. Set aside to cool. Lightly beats the eggs with vanilla extract. Mix all dry ingredients using a bowl. Pour eggs mixture into the chocolate and butter mixture. Add in all the dry ingredients including walnut and chocolate chips and mix lightly. DO NOT OVER MIX. Pour into the baking tin. Bake at 180 degree Celsius for 25 minutes. It’s better to under-bake. Yummy!

14000 points - Dow Jones Industrial Average

Wow! Dow Jones Industrial Average (DJIA) had surpassed the record 14,000 mark briefly on Tuesday. With the global capital markets looking for fresh indicators, DJIA record certainly provides the timely boost to regional markets like in Malaysia, Singapore and Hong Kong.

Currently in the midst of restructuring my stock portfolio. One of the bitter lesson that I learned was not to invest in stocks that have very little liquidity (extremely low volume, wide bid-ask spreads) no matter how good the fundamentals of the company are. Since market condition is random at most time, it will be extremely hard to cash out an under-performing stock at favourable price when it has low liquidity; thus the liquidity risk.

Kopitiam Prank

So far the best Kopitiam prank in Hokkien dialect. Produced by the guys who brought us the infamous RK House prank.

Can Justine Henin Win Her First Wimbledon?

I still believe Justine Henin can win her first Wimbledon this year. She is almost perfect on the tennis court this year minus the Australian Open because she pulled out of the tournament due to her family problem. She is one of the best female tennis players that I like to watch playing besides Maria Sharapova (for her good-looking plus her fighting spirit of course).

Watching Justine Henin plays is pure enjoyment just like watching Roger Federer and Rafael Nadal in men tennis. On the contrary, watching Maria Sharapova plays makes your mind wandering. Hehe. Too bad, Maria Sharapova failed to get passed Venus Williams this year. With Maria Sharapova, Amelie Mauresmo, Serena Williams (lost to Justine), Jelena Jankovic out already, the remaining challenge will come from Venus Williams, whom I think had played brilliantly so far.

Go Justine! Allez!

Structured Warrants (SW)

These days, more and more structured warrants are issued by third party financial institutions and gained listing at Bursa Malaysia. Recently, there is a new breed of structured warrants with their underlying assets (mostly Chinese stocks) that are listed in Hong Kong Stock Exchange (HKEX) came out. This provides some alternatives for local investors to participate in the booming economy of mainland China. Investors should be careful when investing in this kind of foreign SW though. Most of this SW are cash-settled on maturity if in-the-money.

A Few Good Policemen Still Left in PDRM

This is one of the best examples demonstrated by a traffic police. Every other police in this country should learn from him. I "tabib" you tuan! Btw, next time if you get caught, make sure you say "Saya ada enam belas saja".

Wedding Song

I attended a wedding dinner last Sunday at Palace of the Golden Horses. There was a live band performing various songs on stage. I particularly like this song called "Valentine" sung by Martina McBride. Share it with you all.