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Monday, November 1, 2010

Peter Lim A Wilmar and Golden Agri story

Most of you would have known this story - Peter Lim made his fortune investing in Wilmar many many years ago. Back then he invested when the company was at a low price, then now the price is over the moon. One factor was palm oil demand and prices went up through the years.

Wilmar along with Golden Agri, are listed in Singapore. While all their palm oil producing plantations are located in Indonesia. They are both the largest and second largest palm oil producers.

So now, if we are presented the scenario that Peter Lim had many years ago, when Wilmar was affordable. What would you do? With the knowledge that palm oil is heading upwards. And there is this second largest palm oil company being offered at a reasonably low price?

When I first invested in AirAsia, the similar situation hit. This airline is smashing records, over 75 destinations with over 183 routes, all over Asean and China and India, Australia. Recently it had gone from average of 1.50 RM, to over 2.50 RM in 4 months.

So I wonder if the day comes when Golden Agri had moved from 60 cents, to $1.00, to $5.00. What is the target price of Golden Agri? What was the target price of Wilmar? And that "was" was some time ago.

Similarly, what was the target price of Genting Singapore? Remember some powerful research house, or investment group were giving Genting Singapore $1.20 target price. 90 cents target price because of a Rights Issue. $1.25 target price and fear of estimating the gains. Fast forward to today, apparently the target priced has been revised upwards, conveniently.

My wish was to find such a Wilmar. And I had found it several times and several times too were swayed by wrong information, too much information, lack of confidence and believe in myself. So if you have found yours, believe in yourself and hopefully one day, you will know how Mr Peter Lim felt.

"When you first look at kungfu, it appears to be so easy.
When you are training in kungfu, it is very difficult.
When you have mastered kungfu, it appears to be so easy."

This was the legendary kungfu exponent Bruce Lee's philosophy about mastery. Which level of investment mastery are you at?

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