Today
I want to recommend 1 good stock to all my fansi. For those already
bought Johotin since 85 to 90 cents region, congratulation. Please
continue to hold on to Johotin because the potential of this share will
only continue to show over the years. As for me, I am still holding on
to my dear Johotin and will probably hold on to it for another couple of
years because Johotin will truly blossom with the right management,
right product, right market and right investment.
However, I do not discount there are
people who had already cashed out on Johotin since it has appreciated
more than 20% from the base. Since you guys are likes to invest at the
base, or near the base level, probably I would like to show you this
potential share as well.
Now, this share that I am going to recommend is called D&O Green Technologies Berhad. Short form is D&O.
What is so special in this share that I
want to recommend is because the technical chart is showing a good entry
point for strategic investor based on technical outlook.
As you can see, based on the 2 years
chart outlook, the share price of D&O rebounded strongly on the long
term support line. Overall, the share is still showing good momentum
with strong institutional buying in that is keeping the share for long
term.
So why 2019 is a good year for D&O ?
Firstly, new factory in Batu Berendam,
Melaka is slated for operation end of 2018, and will be catering for new
capacity which can cater for 4 to 5 years of growth. Currently, the
growth rate in automotive LED is 15% per annum. With the new factory,
D&O can look for growth rate of 20% to 30%, boosting the bottom line
figure.
Secondly, D&O is able to command a
good gross margin of 25% for it's LED product. The product that D&O
manufacture are no OEM, but OBM (Original Brand Manufacturer), where
D&O owns the patent, design and brand. This will open door of
opportunities for D&O to lease their intellectual property to other
manufacturer for OEM manufacturing of their goods.
Thirdly, D&O is major supplier for
Volvo, which is owned by Chinese company Zhejiang Geely. Currently,
China is the fastest country in implementing energy efficient,
environment friendly products. Hence, partnering with China Zhejiang
Geely is a strategic move that will enable the product offering into the
market faster, with China as the primary market.
So as a conclusion note and summary
1. D&O had a bright prospect with
automotive LED lighting, where current global usage is only 3%.
Projected to see automotive LED usage to reach 15% on 2021
2. D&O new factory ready to cater for new demand, project company growth rate at 20 to 30%
3. Technical chart suggesting a good buy in price at long term support line
Source and additional reading on D&O
Please do your own due diligence in any investment decision.
https://klse.i3investor.com/blogs/targetinvest/191743.jsp
https://klse.i3investor.com/blogs/targetinvest/191743.jsp
