Perodua BEZZA vs Proton PERSONA

Posted in my FB page on 18 July. Sorry for the blur

If you did notice my facebook page, i had been stressing out on the emergence of Perodua Bezza in the Automobile Industry. For me Perodua Bezza comes out in the right time, right price, with the right specification. Right time, is because Bezza emerges when the consumer power is recovering. And now is the exact time to boost up the automobile industry. Right price, is because Bezza is priced from RM37k to RM51k, depending on the specifications selected. Right specification, means this first ever Perodua sedan car obtained a 5 stars ASEAN NCAP (New Car Assessment Programme) for safety. With its fuel efficiency of 22.8 km/l, it can be compared to foreign competitor, Mitsubishi Attrage/Mirage[2][3].

Why i am so fond about this car? First is because it is our Malaysia Perodua's first ever EEV (Energy Efficient Vehicles) sedan car. Imagine it is local made and assembled car. Bezza is made with quality, comfort, spaciousness, reliability, affordability and looks in mind as it has one of the biggest boot spaces in the market with 508 litres available in its class. We, as Malaysians should be proud of Perodua's technology.

Posted in my FB page on 28 July.

Perodua targeted to sell 7,600 units of Bezza per month in 2016[4]. In terms of Mathematic, from August to December 2016, they targeted 38,000 units of Bezza to be sold. Even Mr President and CEO, Datuk Dr Aminar Rashid Salleh was expecting Perodua Bezza to be one of the best volume sellers, targeted for replacement car buyers, specifically newly-weds and young families, who need a larger boot space in line with the new stage in their lives. We imagine, Malaysia had a lot of fresh graduates every year. In the first year of working, most of them will require a car. It used to be Myvi which was their favourite cars. But Myvi is a hatchback car. If we can get a sedan car with almost the same price with Myvi, i believe mostly fresh graduates will also opt for a sedan car as it is more spacious.

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Just within 10 days (16 July to 26 July 2016), Perodua Bezza hits 10,115 bookings, averaging 1,000 units per day. And they had ready stocks of 9,000 units by end of July[5]. And in the early month of August, i already saw a few Bezza cars on the road. And i managed to snap this. See the plate number, it is still new, starting with WD, ending with C. I also saw a display Bezza in the AEON Big. I tried the car and it was comfy. Hmm, we still cant compare with Vios or City, but trust me, we will get there, on par with them

   

That's all about the Perodua Bezza~ Now let's get to the statistics from MAA (Malaysia Automotive Association) and local famous car review website, paultan.org. Let's compare the car sales in Malaysia by brand in 2015 and 2016 at the table below[6][7].

Statistics of Car Sales by Brand in Malaysia

As we can see from the table above, Perodua's sale had dropped 10% from 2015. Not only Perodua's sales, in fact other cars such as Proton, Honda, Toyota and other brands also dropped. Overall, Malaysia car sales had dropped 15% from 2015. The reason i can think of is due to difficulties in getting car loans and the current economic climate of the country[8]. Banks are more stringent in giving out loans and adhere to conditions strictly. The uncertainty of the conditions in the future lead to many defer purchases of expensive items so they can conserve their money in the event they lose their jobs or living costs rise much more.

However, the "stubborn" Perodua maintained its sales target of 216,000 for 2016, beating 2015 total sales of 213,307 units. Perodua was ready to boost sales to 118,630 in the second half from 97,370 units achieved in the first six months so far. MAA recently also revised its 2016 total sales downwards to 580,000 units from 650,000 due to lower vehicle sales in the first half of 2016[9].

Total Sales of Car by Brands from 2001 to 2015[[1]

As we can observe from the chart above, the red bold lines (National) were going down from 81% to 47%, whilst black bold lines (Non-National) had been climbing up from 19% to 53%. The demand for foreign cars had been increasing. Let's zoom in at National vehicles. It is obviously that the local National cars here referred to Perodua and also Proton. Proton sales dropped together with national car sales drop, however Perodua had been consistently maintaining its percentage around 30%, eventhough there is a financial crisis at 2008. If Proton sales percentage is dropping while Perodua sales percentage is maintaining its momentum, meaning to say Perodua actually holds more percentage in the 47% red bold lines. Consumers are buying more Perodua (32%) than Proton (15%), Toyota (14%) and Honda (14%).

Notice this Bezza is Perodua's first ever sedan car? Do you guys wonder why before this, Perodua did not manufacture sedan cars? Well, i think it is something related to Proton. Only Proton produces sedan cars. Now this Bezza is Perodua's first ever sedan car. But Bezza only had 1.3cc, why they did not produce 1.5cc cars while they can? Again, i think something to do with Proton. And i am not going to discuss about that. But from the statistics, most Malaysians prefer Perodua cars to Proton cars.

And recently, with the emerging service of Uber and GrabCar, Perodua Axia and Myvi had become targets for Uber drivers due to its fuel efficiency and its price. Now, i think next target for Uber drivers will be this Bezza. The Land Public Transport Commission (SPAD) had outlined its plans to improve the taxi industry in Malaysia. The Cabinet-approved Taxi Industry Transformation Programme (TITP) is geared to regulate e-hailing services (Uber/Grab), while providing existing taxis new opportunities to remain sustainable and competitive[11].

This Bezza had actually created a lot of market noise, rallied a few companies. The involved companies are MBMR, PECCA, and UMW. But i felt that one company had been missing out, which is OCNCASH, the company which supply felts material to the local car manufacturers. Let's go through this one by one.

1. MBMR

MBMR Daily Chart

MBMR holds Perodua's 20% shares. Bezza is opened for pre-booking on 16 July (Friday), and MBMR share price gapped up on 18 July (Monday). And the share price retraced, forming an ascending triangle. Recently MACD is having a golden cross, however the RSI and BB indicates that the share price had been overbought. If we would like to enter, we should at least wait for the share price to retrace to at least middle band. The upsides are more than downsides, because MBMR had been in downtrend for 4 months, forming bottom for around 6 months. The risk to rewards ratio is not so exciting, 2 rewards against 1 risk. However, please do take note that MBMR only holds Perodua's 20% shares.They still have other business which are auto parts manufacturing and property development, besides motor trading (sales).

I traced back at the time when Perodua Axia was launched. Perodua announced Axia was opened for booking on 15 August 2014 (Friday)[14]. On 19 August 2014 (Tuesday), 3,500 bookings had been received. From 15 August 2014 to 15 September 2014, a total of 13,500 units had been made. Within 30 days, approximately 500-600 bookings per day[13]. The buyers will get their car in the September 2014. And let's look at the chart movement from October 2014 (the day Axia was sold to the consumer) to February 2015 (announcement date of Q4 result).

MBMR Daily Chart in 2014 

As we can see from the chart movement, Axia failed to spark the flavour in MBMR. However, MBMR climbs around 22% from September 2014 to February 2015. 22% for 5 months, that for me is fair performance. After announcing the QR, MBMR dropped because the net profit (yoy +2%, qoq -7%) was disappointing, not up to the shareholders' expectations. So for Bezza, we do not put high hope yet, even though Bezza's booking per day is 1,000 units vs Axia's booking per day of 600 units. And the price of Bezza is also ranges 13% to 51% more expensive than Axia.

2. PECCA

PECCA Daily Chart

PECCA had just listed on 19 April 2016. PECCA chart had been performing very well for the past 4 months. Now it is breaking new high with the support of 1.73. PECCA is the sole supplier of leather car seat covers for Perodua[12]. Since the Bezza news, PECCA share price also rallied. PECCA also will be announcing its Q4 result on 25 August. PECCA is also specialized in providing seats for the aviation industry. Maybank Investment assumed that AirAsia had 200 planes that required to change their seats. There are 180 seats each plane, the cost for 1 seat is around RM3,000 to RM4,000[17]. If AirAsia is really changing the seats, PECCA's revenue will increase.

3. UMW

UMW Daily Chart

As for UMW, UMW holds 38% of Perodua shares[18]. But UMW is the hardest and the slowest to react. Currently, UMW had broken the downtrend channel, also pending quarter result this month. I think maybe the price of UMW is too expensive and also UMW's earnings will be offset by lower Toyota sales and losses at its Oil and Gas business[12]. Therefore people lose the interest in UMW and mostly will go for MBMR, as the price is cheaper. Or also MBMR-WA. MBMR-WA's expiry date is 14 June 2017, still another 10 months to go. But MBMR-WA is currently out of money, as the conversion price is 3.2.

For Perodua Bezza, the potential benefit companies are listed above, MBMR, PECCA and also UMW. But recently, Proton Persona will also be unveiled on 23 August 2016 and now it is available for booking[19]. Not much confirmed information on the new Persona. Proton is owned by DRB-HICOM. Let's look at DRBHCOM's daily chart.

DRBHCOM Daily Chart

Currently DRBHCOM had been active for the past few weeks. The chart had broken the downtrend channel. DRBHCOM had incur losses for 2016. Partly might be because of the Proton sales. After downtrend for a long time, now it seems that the price had rebounded. Not much information on Proton Persona yet, but i am sure that we will have all the information soon. And will Proton Persona brought DRBHCOM price up after dragging their profit in 2016? Let's wait and see. Currently the chart is oversold, with RSI oversold and the candles are at the upper band. The volume had been active recently, fundamentally wise, it is not so steady. I am just afraid that market makers are behind the spikes or their coming QR will be improved. However, stay cautious on DRBHCOM.

Since more local cars will be surfaced out in the second half of the year, i am sure a lot of companies might benefit from it. But we also need to look at the consumers' behaviour whether are they willing to spend more money and also banks whether they are willing to provide loans. However, i felt that there is one company that had been neglected. If our local manufacturer automotive industry had been resurrected, i am quite firm that this company will benefit. I had highlighted the chart in my Facebook Page recently on 11 August 2016.

Highlighted in my Facebook page dated 11 August 2016

OCNCASH is engaged in 2 business, one is the OCNCASH Felts and the other one is OCNCASH Non-Woven. Coincidently, i am browsing through Perodua's website and i saw this picture.

The GearUp Driving Comfort is obtained from the Perodua Bezza website while the Resinated Felts and Thermoplastic Felts is obtained from OCNCASH website.

In order to confirm whether OCNCASH is supplying felts to our local made cars, i had emailed to the management and they had confirmed that they are supplying the felts to our local manufacturers and there are other competitors as well. If Perodua Bezza and Proton Persona hit big sales in Malaysia, OCNCASH is another company that we can look into. Not only MBMR, PECCA, DRB-HCOM, OCNCASH should be under the spotlight as OCNCASH benefits from both local cars and moreover the current share price can be considered the cheapest and it had not spiked up like PECCA and MBMR. If you want to know about the fundamentals of OCNCASH, previously i had wrote about OCNCASH in my previous posts, you can click here (1) (2).

OCNCASH Daily Chart

OCNCASH had been in downtrend after hitting the highest point of 0.5 at 13 January. OCNCASH also being affected by the weak Q1 result. As OCNCASH will be announcing their Q2 result in this month, the volume starts picking up and the chart is in uptrend mode. As per highlighted in my Facebook page, there is an golden triangle being formed and the chart is in a bullish uptrend pattern. The next immediate resistances of 0.39 and 0.42. If OCNCASH is able to break the resistances in this month before the quarter result is announced, then it had more power to challenge the further resistances.

It is amazing that simple things in our life that can spark the ignition of the stock prices. As simple as a car, it already rallied a few stocks. These are all a part of our life, it is only up to us whether we want to ride the wind or we just let the wind be blown away. If you have any queries, you are always welcomed to whatsapp me at 016-2467867 or you can FB messenger me at my FB page, Gainvestor. Let me try to fill out the blanks in the question pools. Opportunities are here, take action and grab it NOW!!

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Let's Ride the Wind and Gainvest

Gainvestor 10sai

18 August 2016
12.10pm

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Sources:

[1]: http://paultan.org/2016/01/19/foreign-brands-again-outsell-proton-perodua-in-2015/2015-mkt-share-perodua/

[2]: http://paultan.org/2016/07/21/perodua-bezza-officially-launched/

[3]: http://www.perodua.com.my/ourcars/bezza
[4]: The Edge Financial Daily dated 18 July
[5]: http://paultan.org/2016/07/26/perodua-bezza-hits-10115-bookings-averaging-1000-per-day/
[6]: http://paultan.org/2016/07/27/malaysia-vehicle-sales-data-for-june-2016-by-brand/
[7]: http://paultan.org/2015/07/28/malaysia-vehicle-sales-data-for-june-2015-by-brand/
[8]: http://www.motortrader.com.my/news/weak-start-to-new-vehicle-sales-for-second-quarter/
[9]: http://www.themalaymailonline.com/money/article/perodua-sees-better-sales-in-second-half-of-2016
[10]: http://paultan.org/2016/01/21/2015-malaysia-vehicle-sales-market-review-by-brand/
[11]: http://paultan.org/2016/08/16/spad-unveils-plan-to-resolve-long-standing-issues/
[12]: The Edge Financial Daily dated 25 July 2016
[13]: http://paultan.org/2014/09/16/perodua-axia-orders-13500-units/
[14]: https://en.wikipedia.org/wiki/Perodua_Axia
[15]: MBMR Q4 2014 & Q3 2014
[16]: http://paultan.org/2014/12/18/perodua-anticipating-total-sales-195000-units-2014-axia-gets-62000-bookings-26000-delivered/
[17]:http://www.sinchew.com.my/node/1557776/bezza%E7%83%AD%E9%94%80%E5%B8%A6%E5%8A%A8%EF%BC%8Epecca%E4%B8%9A%E7%BB%A9%E6%96%99%E8%B5%B0%E4%BF%8F
[18] UMW Annual Report 2015
[19]: http://www.thestar.com.my/business/business-news/2016/08/16/proton-persona-now-open-for-booking/