Fundamental investing has been around since the beginning of investing and stock markets. Great investors from Warren Buffet, Peter Lynch and others have embraced it with great success yet many investors in the streets today do not find it an exciting enough way to invest, preferring the “thrills” associated with a hot tip or speculation. If you have a well thought out strategy and find a diamond in the rough, the returns from investing in the fundamentals can be much more spectacular than any hot tip. IOI Group
One example here in Malaysia is the IOI group. This plantation and property conglomerate with RM19 billion market capitalization (US$ 5.1 Billion) was recently rated as the eighth most transparent, competitive and admired company in Malaysia by the Wall Street Journal together with the likes of Maxis, Public Bank, Digi and Star. IOI group is best performing and has attracted the most domestic and foreign investors. IOI group's success has also propelled its chairman and major shareholder, Tan Sri Dato' Lee Shin Cheng, into Forbes magazine's Asia 's richest list last year.
15 Years Ago
Back in 1992, Tan Sri Dato' Lee was then by all accounts a very successful local property developer cum plantation owner with two public listed companies under his wings. He had a sound reputation, and was also widely hailed for his business acumen. But what was really impressive was his in-depth knowledge and passion for the plantation business; yet honestly, IOI was at that time still a small player foraying into the plantation business and was up against the established big boys like Guthrie, KL-Kepong (KLK) and Golden Hope.
In the early and mid-90's, the plantation industry was already very competitive, cyclical, and mature. Many consider it as old “economy” and even a sunset industry. The buzz then were 2 nd board companies- with many highly touted stocks in new growth companies engaging in exports to high technology and high share prices to boot. With great vision and management skill, Tan Sri Dato' Lee expanded aggressively further into the palm oil plantation industry.
IOI group's achievements since then have been spectacular to say the least. In these short 15 years, Tan Sri Dato' Lee's passion and hard work in the plantation and property business have made IOI group into one of the most admired and largest companies in Malaysia. IOI's plantation has grown to more than 140,000 hectares, the company also went downstream to acquire related businesses that are counter cyclical to the plantations as a business strategy; the result was that listed Palmco was acquired in 2001 for the oleo chemical business and in 2002, Loders Croklaan based in the Netherlands was acquired from Unilever, pushing IOI further downstream as well as moving the IOI group on to the global stage. Similarly, IOI Property has sold properties worth RM 5.1 Billion since 1992 and is now considered as one of the top property companies in Malaysia .
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