DNEX

12 thg 8, 2021

Since last year we've seen tech rallies for many tech counters such as UWC, Greatech, Inari, MI, Penta and etc and most of it have achieved more than 100% of ROI if you bought it in early of 2020. The share price have been soared to so high to reflect the current earnings and attractive future prospects in semiconductor industry. If you are still looking for another potential tech counter that can bring you another 100% of ROI, why not just switch your attention to this counter, Dagangan Exchange Berhad or we called it DNEX.

Yes, this counter has been skyrocketing from 0.10 early of this year to current price of 0.81, with highest price done at around 1.00+ due to their acquisition of Silterra Malaysia Sdn Bhd, cooperated with CGP from China funds to win the bid from Khazanah. Another giant company from Taiwan, Foxconn or Hon Hai, the major supplier to Apple Company joined the game by taking up 5% of stakeholding in DNEX at the price of 0.90 per unit of share after they loss the Silterra deal to DNEX.

An interesting fact we can see from Bursa Malaysia, where there is a clear or obvious signal been showing to the market, for example Foxconn buying the shares of DNEX at 0.90, the market reacted immediately with gaping up of share price from 0.85 straight to 0.90+ in next trading day. Well, in this market situation where all the political uncertainties and rising of covid cases in Malaysia, panic buying is never a good thing in the market, especially in Bursa Malaysia. Worsened by conversion of company warrants that offered negative premium, the share price has been pressed down to nearly 0.65 before it rebounded to current price of 0.815.

Okey, now we've know what is happening for the past few months on this share counter, let's move our sight to the latest movement of this counter where we can see the price has rebounded from 0.67 forming higher low and higher high to current price level with support zone in the region of 0.78 -0.80 which can be act as the cut loss point for short term play. However, I do not suggest for any contra trade or short term play in this counter, where we can see the price movement for the past few months, fluctuating above and below EMA 25 & 50 that caused many short term players cut loss their trade position. Hence, I would suggest to hold for long term for this counter (at least 1 year) with high expectation on their semiconductor segment (their have other segments as well like oil and IT, you can check from their website) that high possibility of turnaround of Silterra Malaysia Berhad, with technical support provided by one of the key person from Foxconn further by more and more business that will be brought in by CGP (already announced long term contract value of USD400 mil or RM1.7b, oh please, contract value RM1.7b for a company with current market capital of RM2.5b, are they kidding?! Haha) and I believed more and more contracts will be brought in by CGP and FOXCONN!!. So here is my strategy:

Current Price: 0.815
Target Price 1: 0.90
Target Price 2: 1.00
Target Price 3: 1.50 (Mid - Long Term)
Target Price 4: 2.00 (Long Term)
Support 1: 0.78 - 0.80
Support 2: 0.70
Support 3: 0.65
Support 4: 0.56 - 0.60 (if break and close below, gg and can remove from the watchlist already).