Hi Tze Hong, keeping in watchlist for now. While current price is decent from risk reward perspective, it will be attractive financially if there is opportunity to buy at mid to lower forties. Dsonic revenue are mainly driven from mykad, passport and autogates systems related and affected by pandemic as most transactions for these applications are at the low side now. However, it will gradually recover as economy/borders reopens. Current order book for Dsonic on hands is approx $420M to $450M. Dsonic lost the bid for NIIS project which is worth $1.1b and since then, a new MD was brought in. 3rd MD within 2 years. It seems to me that the latest MD has plans to increase its order book and working on several projects bidding: i-Kad, National Digital Identity and the Jendela 4G spectrum. for now, these bidding are prospects. Another point to take note is also Urusharta Jamaah which manages the assets of Tabung Haji and has been actively rebalancing its portfolios (selling non performing assets) is now increasing its position in Dsonic; and they have a representative on Dsonic's board members. It takes time to see whether will we start to see more institutions becoming part of the shareholders. Just my opinions, could be wrong. Hope it helps.

hi Cheng, would like to seek you explanation and view on the bonus issue exercise undertake by Comfort. They are issuing warrants instead of ordinary shares and the exercise price is fix at Rm2.30. Do you know the rationale of the management in doing that?

Hi Tze Hong, if you can recalled back our discussion last year when you asked about Comfort. The price we discussed back then and compare with the exercise price :) hope that helps to address the exercise price perspective. As for why warrants and not bonus shares? The biggest difference between the two is the impact towards retained earnings. dividends and bonus share are taken from retained earnings while warrants does not affect retained earnings. When warrant holders convert it to mother share in future, then retained earnings will be affected when dividends are issued in the future. Hence, perhaps the mgmt wanted to maintain its retained earnings for future purposes such as working capital, capex, debt and even share buybacks. I briefly looked at the numbers in its latest annual report - approx $408M retained earnings; yet to minus 2nd interim dividend and special dividend totalled approx $21M, share buybacks $10M, committed capex for FY21 at approx $40M, approx $55M debts and Comfort’s historical yearly retained earnings before the pandemic was at high of $120M. And perhaps the peak demand/net income maybe over, hence, it’s safer to be more prudent and preserve the retained earnings for future growth. Just my opinions, could be wrong. Hope it helps.