OK, the Nasdaq has gone to an 11 year high. More localised news, the Thailand floods wreaked havoc on the HDD and related components supply chain. While this blog picked it up at 50 sen, JCY's current price and dramatic change in fortunes seems implausible 2 months back.
If you look at the recovery in Notion Vtec, it was OK but nowhere as spectacular as some of the rest in the same industry. There is still a lot of unknowns and uncertainty as to who are the real winners and losers from the Thailand floods.
While JCY did not see any of their factories affected, and they benefited from strong additional clients. I think some investors still think Notion Vtec came off from the floods worse than before. Management has guided analysts that 1Q2012 will see revenue declining 40% q-on-q. However, there are strong newsflow from the industry that Notion Vtec actually benefited significantly from the floods as well. Apparently their Thai factory which was affected only contributed a small portion of revenue.
If one were to dig deeper, fortuitously, they have excess capacity in Klang, and it appears that they have ramped up production there owing to the fact that they have secured 3 new big clients owing to the redirection of logistic supply chain away from the affected areas in Thailand.
Some are hinting that profits and revenue are even higher now than their results prior to the floods. If that is going to be the case, then the share price should be closer to RM2.40-2.50 and not dawdling below RM2.00.
Notion Vtec mother share price and volume:
| 03/02/2012 | 1.97 | 1.91 - 1.97 | 1.91 | -0.06 (3.05%) | 506,800 |
| 02/02/2012 | 1.96 | 1.94 - 1.99 | 1.97 | +0.01 (0.51%) | 175,800 |
| 31/01/2012 | 1.94 | 1.92 - 2.03 | 1.96 | +0.02 (1.03%) | 1,654,800 |
| 30/01/2012 | 1.84 | 1.82 - 1.94 | 1.94 | +0.10 (5.43%) | 890,800 |
| 27/01/2012 | 1.83 | 1.80 - 1.84 | 1.84 | +0.01 (0.55%) | 270,000 |
| 26/01/2012 | 1.82 | 1.82 - 1.86 | 1.83 | +0.01 (0.55%) | 305,300 |
| 25/01/2012 | 1.85 | 1.82 - 1.86 | 1.82 | -0.03 (1.62%) | 189,300 |
| 20/01/2012 | 1.84 | 1.84 - 1.85 | 1.85 | +0.01 (0.54%) | 45,000 |
| 19/01/2012 | 1.86 | 1.83 - 1.86 | 1.84 | -0.02 (1.08%) | 93,100 |
However, if you want to spot something brewing, the sharp uptick in the warrants and volume as well over the past few days may indicate some substantive good news or corporate developments to follow soon.
NOTE: The above opinion is not an invitation to buy or sell. It serves as a blogging activity of my investing thoughts and ideas, this does not represent an investment advisory service as I charge no subscription or management fees (donations are welcomed though). The content on this site is provided as general information only and should not be taken as investment advice. All site content, shall not be construed as a recommendation to buy or sell any security or financial instrument. The ideas expressed are solely the opinions of the author. I may already have shares in the above mentioned stock/s. Any action that you take as a result of information, analysis, or commentary on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.
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