Sarawak Bakun Dam

Some of you might not heard of Bakun Dam before. For your information, it is actually one of the largest hydroelectric dam in the world. The federal government has recently decided to sell its stake to back to Sarawak. This dam has a surface area of 690 km square which is slightly bigger than Singapore (630 km square).

Location of Bakun Dam. Sungai Balui which is a tributary source of Rajang river (Longest river in Sarawak)

An aerial view of Bakun Dam.

KUALA LUMPUR: The Federal Government will negotiate with the Sarawak Government to come up with a "reasonable price" over the state's bid to buy the Bakun hydroelectric dam for RM6 billion.

Deputy Prime Minister Tan Sri Muhyiddin Yassin confirmed the Federal Government would sell the nation's largest hydroelectric dam to the Sarawak government.

He said on Monday, Sept 27 the Federal Government was working out the details for the transaction including the finalisaiton of the price and method of payment.

"In principle, the (federal) government has already agreed (with the sale) as was announced by Datuk Seri Peter Chin," he said.

He was speaking to reporters after delivering the keynote address at the World Capital Markets Symposium 2010.

Last Friday, Chin, who is Minister for Energy, Green TECHNOLOGY [] and Water said both governments would begin negotiations on pricing terms for the deal.

"It is normal for people to make a lower offer when they want to buy something. But I believe when the deal will be finalised at a reasonable price that will be agreed by both parties," said Muhyiddin when asked to comment on purported higher offers by other parties bidding for the hydroelectric dam in Belaga, Sarawak.

Recently, Chief Minister Tan Sri Abdul Taib Mahmud was reported said the state may even consider offering up to RM7 billion under certain conditions.

*News updated by The Edge Malaysia. on 27th September 2010.

History of Bakun Dam

Bakun Dam is expected to generate 2,400 megawatts (MW) of electricity once completed. The purpose for the dam was to meet growing demand for electricity especially for Peninsular Malaysia. However, the dam is located in East Malaysia (Sarawak), therefore the original plan was to build an undersea cable to sent 70% of the electricity generated from this dam to Peninsular Malaysia.

This giant hyrdroelectric dam is not something new. This project was actually proposed and studied in the early 1960s. It was first approved by the government in 1986 but was then shelved in 1990 due to decreased projection of electricity demand due to the economic recession of 1986 and 1987.

In 1993, the Prime Minister then Mahathir Mohammad revived the idea. In January 1994, he awarded the privatized contract to Ekran Berhad which is controlled by a business man, Ting Pek Khing. Ting had impressed Mahathir with his construction projects in Langkawi Island. It was an unfair bid since the project was not tendered publicly and also, Ting Pek Khing himself a timber tycoon with no experience in building a dam before was award a biggest project of the century. Of course, this project turned out to be failure under him. In 1997, due to the financial crisis, the project was halted. By then more than RM 1.6 billion had already been paid out by the government.

In 2000, the project was again revived through a government owned company, Sarawak Hidro. Part of the construction project was tendered out to Sime Engineering Berhand (A subsidiary of Sime Darby and Sino-Hydro Corporation of China). It was estimated be completed by 2008. However, due to various reasons and cost overrun, the project has been delayed, and it was estimated that this project had cost the government at least RM 7 billion plus interest.

Now that the Federal government have decided to sell its stake to Sarawak Energy, part of the electricity generate will definitely be used to support the upcoming Aluminium smelter in Similajau near Bintulu.

Interview with Google's Chairman and CEO Eric Schmidt

In an interview with WSJ's Alan Murray, Google Chairman and CEO Eric Schmidt stated that Bing was Google's primary competitor, not Apple or Facebook. He also insisted that Google is doing enough to protect user privacy.

Eric Schmidt is currently the Chairman and CEO of Google Inc. He is also in the Forbes's list as one of the richest man in the world with an estimated net worth of USD 6.3 billion surpassing Steve Jobs from Apple Inc.

Wind-Turbine maker Planning IPO

HONG KONG—Chinese wind-turbine maker Xinjiang Goldwind Science & Technology Co. plans to raise up to $916 million from a revived initial public offering in Hong Kong, according to a term sheet seen by Dow Jones Newswires on Friday, after scrapping a plan to raise $1.2 billion in June.

The company, which is already listed on mainland China's Shenzhen stock exchange, was previously scheduled to list in Hong Kong on June 22 but shelved the deal because of volatile markets. It now plans to list Oct. 8, according to the term sheet.

Xinjiang Goldwind was one of several firms that shelved IPOs in Hong Kong earlier this year. Chinese iron-ore producer China Tian Yuan Mining Ltd. called off its $522 million IPO on May 7, a day after Swire Properties Ltd. decided not to go ahead with a listing that had aimed to raise as much as $3.09 billion.

Since then, IPO markets have become active again. Agricultural Bank of China Ltd. listed in Hong Kong and Shanghai in July after raising $22.1 billion in the world's largest IPO, eclipsing the previous record held by Industrial & Commercial Bank of China Ltd.'s offering, which raised $21.93 billion in 2006. American International Group Inc. is listing its Asian life-insurance unit, AIA Group, in a share sale that could raise as much as $15 billion for U.S. taxpayers in coming months.

Xinjiang Goldwind is selling 395.29 million shares, amounting to 15% of the listed company, between 15.98 Hong Kong dollars ($9.13) and HK$17.98 a share, the term sheet said. The deal has an over-allotment option that, if exercised, would result in 16.9% of the company being listed in Hong Kong.

J.P. Morgan Chase & Co., Citigroup Inc., Goldman Sachs Group Inc., China International Capital Corp. and Haitong Securities Co. are bookrunners on the deal, a person familiar with the deal said Friday.

Xinjiang Goldwind is the world's fifth-largest wind-turbine maker by capacity. It is one of several Chinese clean-energy companies seeking to raise funds from Hong Kong listings over the next few months amid Beijing's push for alternative energy sources.

*The above news were adapted from WSJ Asia.

Xinjiang Goldwind Sci & Tech Co. Ltd.

Xinjiang Goldwind Science & Technology Co., Ltd is a China-based company engaged in manufacture and distribution of wind turbine generator sets. The Company’s major products are 750 kilowatt (KW) and 1.5 megawatt (MW) wind turbine sets. The Company also involves in spare parts development and manufacture, provision of wind power services, development and distribution of wind farms, as well as development and transfer of wind power technologies, among others. During the year ended December 31, 2009, wind turbine generator sets accounted for approximately 95.33% of the Company’s total revenue. It distributes its products in domestic and overseas markets.

Video on RIM's Blackpad and Facebook movie

RIM is planning to launch a tablet device to compete with the famous Ipad of Apple. This video also talks about a movie that is coming up soon featuring facebook and it's founder.

China's Agriculture

As we all know, our basic needs are food, clean water and air. Recently, i just did some research on China's agricultural section and found a few interesting companies which made up onto my list on-watch. I even bought one of them a week ago.

China, a nation with a population over 1.3 billion (that's about 20% of the world's population) has only 7% of the world's cultivation area feed all of them. No wonder, the Chinese government is so desperate working with WTO to subsizdize improvement and equipments for farmers to increase agricultural output. China has also assigned most of it's land as agricultural land and those who use these land for other purposes (eg. residential, commercial or industrial) will get severe punishment. And recently, the cry for a higher wage is still clear in your mind from those examples of work-related suicides that prompted Foxconn (who manufacture most of the mobile phones on earth) to increase their minimal wages by at least 30%. These are all examples of an inflation in salary which would eventually lead to an improvement in living standard for those 1.3 billion Chinese. With more money, we tend to enjoy life better, better food, better shelter and better transportation and eduction. Therefore, the demand for food will grow at an exponential rate, from rice, soybean and coffee to companies that manufacturers of fertilizers and tractors for those farmers will benefit.

There is a plenty of room for growth in the agricultural sector, for example, according to the USDA statistics, South Korea consumes seven times more milk than China per capita, Taiwan eleven times and Japan sixteen times.

Chaoda Modern Agriculture (Holdings) Ltd.
HKG : 0682, H-shares
Chaoda Modern Agriculture (Holdings) Limited is an investment holding company. The Company, along with its subsidiaries, is engaged in growing and selling of crops, and breeding and selling of livestock. The Company’s operations are primarily in the People’s Republic of China. Chaoda Modern Agriculture (Holdings) Limited is a fruit and vegetable producer. The Company supplies frozen fruits and vegetables to retailers, food processors and the food service industry in Europe, North America, the Middle East and Japan. It also breeds and sells livestock, including Boer goats, Dorper sheep and dairy cattle. The Company grows a wide variety of rice, which is marketed under the Chaoda brand. The Company mainly grows white, brown, black and Thai rice.
The best thing about this company is that it has a net profit margin of above 40%, that's a big fat margin for any kind of businesses. This company with a market capital of RMB 20 billion is sitting on a cash pile of RMB 1.1 billion. Also, the company's stock is currently trading at a P/E of 4.75 which is cheap given the company's potential growth and strong cash flow.

A summary of the company's consistent growth over a period of 9 years.

5 year financial summary

The company's stock price since 2001. The company is paying out regular dividends and have a consistent growth in it's stock's value. It is currently trading around HKD 6.80 per share which is still around 40% down from it's all time high of HKD 11.90 per share in 2008. It is a good bargain indeed.

Other companies to watch are listed as below:

China BlueChemical Ltd.
HKG 3983, H-shares

China BlueChemical Ltd. is engaged in the manufacture and sale of phosphate fertilizers. The Company operates in four segments: urea, phosphorus fertiliser, methanol and others. The urea segment is engaged in the manufacture and sale of urea. The phosphorus fertiliser segment is engaged in the manufacture and sale of mono-ammonium phosphate (MAP) and di-ammonium phosphate (DAP) fertilizer. The methanol segment is engaged in the manufacture and sale of methanol. The others segment consists of segments engaged in port operation, the provision of transportation services and the manufacture and sale of woven plastic bags and BB fertilizer. On February 28, 2009, the Company acquired 83.17% and 100% interest of Hubei Dayukou Chemical Co., Ltd. (DYK Chemical) and ZHJ Mining Company Limited (ZHJ Mining) respectively.

First Tractor Co., Ltd
HKG: 0038, H-shares
First Tractor Company Limited is engaged in production and sale of agricultural tractors. The Company operates in four segments: agricultural machinery, construction machinery, financial operations, and diesel engines and fuel jets. The agricultural machinery segment is engaged in the manufacture and sale of agricultural machinery, including tractors, harvesters, and related parts and components. The construction machinery segment is engaged in the manufacture and sale of construction and road machinery. The financial operations segment is engaged in the provision of loans, bills discounting and deposit-taking services. The related parts and components segment is engaged in the manufacture and sale of diesel engines and fuel injection pumps. Its subsidiaries include Brilliance China Machinery Holdings Limited, Yituo (Luoang) Construction Machinery Co., Ltd., Yituo (Luoyang) Building Machinery Co., Ltd. and Luoyang Changlun Agricultural Machinery Company Limited.

China Food Ltd.
HKG : 0506, H-shares
China Foods Limited is an investment holding company. The Company along with its subsidiaries is engaged in production, sale and trading of grape wine and other wine products; processing, bottling and distribution of sparkling beverages and distribution of still beverages; distribution of retail packaged cooking oil and other consumer food products, and production and distribution of chocolate and other related products. The Company operates in five business segments: wines segment, beverages segment, kitchen foods segment, confectionery segment, and corporate and others segment. On January 9, 2009, a 65% equity interest owned subsidiary of the Company, COFCO Coca-Cola Beverages Limited (CBL) acquired 40% interest in Beijing Coca-cola Beverage Co. Ltd (Beijing Bottler) from Coca-Cola China Industries Limited.


*Disclaimer: The author do own shares of Chaoda Modern Agriculture Ltd. but does not own shares of other companies mentioned in this article. The author will not be responsible for any damages or losses.

Ipad and it's competitors

Samsung is unveiling it's Samsung Galaxy Tab "An Ipad killer?"

Ipad, Apple's innovative product has been facing fierce competition from its rival such as Toshiba, Samsung, Dell, HP and even RIM (Blackberry). So far, Apple has sold 3 million ipads and has 75% market share.
Here are some examples :

Samsung's newly launched Samsung Galaxy Tab. It is going into the market for around 200 to 300 USD. It runs on Android platform.

Toshiba's Folio 100, 10.1 inch multitouch tablet. It runs on Android platform.

Apple's Ipad. It runs on Apple OS

RIM's Blackpad. RIM is planning to launch it's Blackpad sometime around November 2010. It runs on Blackberry OS.