Companies that benefit from savings in energy bills

Tenaga's price cut is a boon to almost all companies.  Almost every stock has a big power bill they would like reduced, but perhaps the hottest companies will be....shopping malls.

Everyone who pays a utility bill knows the biggest component comes from Air conditioning.  If you want to reduce your electricity bill, use less air conditioning.  Not running air conditioners can reduce an electric bill by close to 40 percent.  These beasts take up to 1000 watts of electricity on run for hours on end.  Higher horse power = higher energy bills.

Now, who are the biggest users of air conditioning in KL, yeap you guessed it, shopping malls.  It's not just the sheer square feet, but also the volume.  Most shopping malls are cavernous and have huge volumes of air pockets to cool.  Not only that, they open for many hours much longer than your average business.

What else do these shopping malls have going for them?  Many of them have raised rental fees from parking to shop lot rentals to cope with the rise in electricity costs in 2015.  These rental fees don't drop and are not prone to price reductions like most government entities are.    Any reduction in costs of business will flow directly to their bottom line.

Shopping malls seem to be one of the tasty treats for 2015.

The 1MDB IPO Hoo hah! and IGB REIT

I just thought I'd comment about the 1MDB IPO.  It does seem this administration is hell bent on successful government IPOs.  Looking at Felda, looking at a whole host of government IPOs, almost all have been successful trading at a premium to IPO price by about 5 percent.

I have no doubt that this 1MDB will be a successful IPO as it is laden with lucrative government contracts, including some from Tenaga.  As much as I've liked Tenaga for its tariff rationalization, and revenue upside, these "deals" with no negotiation just make me want to hurl and throw Tenaga out the window.

IGB REIT is an absolute gem of an REIT.  If there was one REIT in town that I would be confident in owning that will withstand the next decade or two, it would be Midvalley shopping center.  It is easily the best shopping center in KL.  The car park is consistently full at 1 pm on the weekend.  Not only that, It's location is much more appealing than any other shopping center in Kuala Lumpur.

In a recession IGB REIT would hardly get dinged with all of the hungry mall shoppers and it generally falls into a reasonable price range.  This is a recession proof property that any long term investor would be comfortable having.

Unfortunately, I did not realize the stock dipped earlier in the year.  That would have been a nice pick up at those prices.  Sometimes missed opportunities are sad.  :(