ASDION (0068) ASDION BERHAD CALLS TO BRING BACK GST !!! THIS STOCK AMONG THE BENEFICIARIES !!!
CALLS TO BRING BACK GST !!! THIS STOCK AMONG THE BENEFICIARIES !!!
Hello
to all readers out there. Recently, TECH counters in NASDAQ have made a
big rebound from their March lows. From a low of 6631 in March, to the
latest closing of 9489 yesterday, this means that NASDAQ has rebounded
2856 points or 43% from its low, and just few hundred points shy of
making a full recovery from its recent highs.
Having said the above, the stock which I'd like to talk about today is ASDION BERHAD (ASDION - Stock Code 0068, ACE Market, Technology - Software)
BASIC INFORMATION ABOUT ASDION
ASDION
is a company involved in development and promotion of advance
integrated IT solutions for the services industry including hospitality,
F&B and healthcare sectors.
ASDION
was granted MSC status on 4 March 2004. Its subsidiary, ASDION Data
Services (ADS) specializes in business process outsourcing (BPO)
services.
Market Capital : RM 16.63 million
Shares Float : 127.9 million
CALLS TO STUDY ON BRINGING BACK GST, AS THE SST DID NOT MANAGE TO REDUCE PRODUCT PRICES
Back
in 11 March 2020 during the first cabinet meeting, our PM had mentioned
that government will study calls to bring back GST as the SST
introduced under the PH government did not manage to reduce the price of
essential goods.
Also,
most recently on 21/5/2020, former PM DS Najib Razak had also pushed
for GST, but explained that the people must first understand the
benefits of GST in order to support it when it is reimplemented.
1. ASDION AMONG VENDORS ABLE TO DELIVER GST MANAGEMENT SYSTEM
I
would like to highlight an old news article in September 2014 where it
was highlighted that CENSOF, ASDION and YGL are rising on GST sentiment
play.
At the time, ASDION was trading at 41c as the portion of GST compliance contract was estimated to be at RM 1.7 billion total.
billion
total. By the time GST was introduced in April 2015, ASDION price has
skyrocketed up to a high of RM 1.60 in July 2015, before there was
profit taking and prices dropped back.
2. ASDION ALSO DIVERSIFYING INTO PROJECT MANAGEMENT - ONGOING IS TUMPAT SUPPLY BASE PROJECT IN KELANTAN
ASDION
had joint ventured with Kingdom Infra Holdings Sdn Bhd (KIHSB), to
develop and manage the Tumpat Supply Base project in Kelantan. They had
received the relevant land titles from the state government, setting the
stage for the project's imminent construction and commencement.
3. ASDION CHAIRMAN - DATUK SERI MAGLIN DENNIS D'CRUZ - SENIOR VP OF MYPPP M'SIA - PART OF PERIKATAN NASIONAL
If we check the background of Chairman, we can see that Datuk Seri Maglin Dennis D'Cruz, was appointed in 28 September 2015.
He
is currently Senior Vice President or myPPP Malaysia. He was appointed
Deputy Minister of Information, Communication & Culture in July 2010
and served one term.
4. TECHNICAL ANALYSIS - BREAKOUT OF EMA200 ON DAILY CHART
Refer
below the basic price and volume chart with key EMAs for ASDION on
monthly chart for us to see the overall picture of this stock:
A few observations on the monthly chart:
i.
Based on Arrow #1, it can be seen the strong uptrend from 30c to RM
1.60 at the time GST was in discussion in late 2014, and then
implemented in April 2015.
ii. Since then, price had seen profit taking to about 13c lows in Feb 2018
iii.
From Circle #2, it can be seen heavy trading volumes started in FEB
2018 where the price went to a high of 53.5c before profit taking
started to happen again and prices went down when BN lost the election
in May 2018
iv.
From Circle #3, it can be seen that price had closed at the EMA14 at
13.5c, with significant volume building up in the latest month of May
2020. Next key EMA is at 21c.
Refer below the basic price and volume chart with key EMAs for daily:
A few observations on the monthly chart:
i. Heavy trading last year from January to April 2019, where the price hit a high of 30c in March 2019
ii.
Since then, ASDION went on a steady downtrend with small volumes until
recently hit a low of 6c on the back of low volume trading
iii.
Start from early May 2020, after the COVID19 situation had improved and
MCO was relaxed, saw a surge of volume trading in ASDION
iv.
On Friday 29/5/2020, it was able to close at 13c, which is above its
key EMA200 of 12c. Next important EMA365 to be tested is 15c for it to
confirm a bullish price trend.
CONCLUSION
Considering all the above, I opine that current price for ASDION is attractive due to below:
i) Calls to bring back GST, and ASDION being among the vendors able to deliver the GST solutions to businesses
ii) ASDION also diversifying into Project Management, with ongoing Tumpat Supply Base project in Kelantan
iii) Chaiman Datuk Seri Maglin Dennis D'Cruz, Senior VP of myPPP Malaysia, which is friendly to PN coalition
iv) Breakout of Key EMA200 on Daily Chart, with next test at EMA365 to confirm long term bullish trend
LET’S SEE HOW THE SHARE PRICE MOVEMENT IN THE NEAR FUTURE FORBEARING ANY GOOD CORPORATE NEWS.
Disclaimer
: The above opinion is never intended to be a BUY CALL whatsoever. I am
sharing my observations ONLY based on fundamental; past history;
current trading pattern; charts etc. Please make your own informed
decision before buying this share or whatever share for that matter.
BURSAMASTER
https://klse.i3investor.com/blogs/Bursa_Master/2020-05-30-story-h1507921339-CALLS_TO_BRING_BACK_GST_THIS_STOCK_AMONG_THE_BENEFICIARIES.jsp
