This month, I sold some counters to raise cash for more compelling ideas. Also, increase my stakes in a few of my US counters.
(figure in bracket represents the % the counter is occupying my portfolio based on cost)
Sold
1. Divested ISEC completely at $0.315 even though it has reported a good set of numbers in the latest quarter. Still find this an interesting outfit but decided to temporarily say goodbye to it as I wanted to buy other counters.
2. Sold Hock Lian Seng (2.0%) at $0.47 for a gain of 7.6%. This reduced my stake in the company and it now only occupies only 2% of my portfolio. Continue to believe in its ability to sustain its dividend based on the cash that it has and its strong order book. However, I relatively like my new positions.
Accumulate
1. Re-entered Capital Mall Trust (2.3%) at $2.02 after attending a sharing by Deputy CEO of Capital Mall Asia, Wilson Tan. Basically, he opined that retail mall is here to stay and Capital Mall will continue to be a powerhouse a decade later. With the purchase of CMT, I now own a slew of retail REITs but each for a different reason.
SG Reit - my longest holding for its focus on mall in prime area and its overseas exposure.
FCT - for its focus on sub-urban malls with most of them near MRT stations.
CMT - for not resting on its laurels and continues to take actions to be at the fore-front of retail mall.
2. Added more UMS (4.1%) at $1.05 after it announced a good set of Q3 results. Optimistic about its upcoming performance for the next few quarters and confident that it will at least maintain its dividend.
3. Added Intuitive Surgical (1.1%) @388.85 as I forgot to update my spreadsheet for its stock split! Luckily, bought only 4 shares to round up my total shares to 10. Let's hope it can continue with its splendid growth, then the mistake can become a blessing in disguise.
4. Added Vail Resorts (0.7%) @235.77 as it continues to report good growth from its acquisition. While management guided that 2018 growth might be slower due to the strong growth this year, long term prospect should remain good.
5. Re-entered Priceline (1.0%) @1655.75. I had sold earlier in September at 1840.6, making a loss of 5.1%. Since then the group announces a solid Q3 results which beats its own guidance. However, the market bashed it down due to another muted Q4 guidance. Seeing that Priceline always beats its own estimate, I decided to re-enter Priceline at a better price.
Showing posts with label starhill. Show all posts
Showing posts with label starhill. Show all posts
Tuesday, 28 November 2017
Thursday, 9 November 2017
Core holdings quarterly reporting (October to December) Part 1 - Reit
Decide to break up my core holdings quarterly reporting to two parts as my 3 REITS have completed reporting and the rest of my holdings are still reporting their results until the end of the month.
Again, my definition of core holdings are counters which I am more familiar with. These are counters which I am more confident of and have a more substantial holding (about 5% of portfolio); hence I am more likely to hold them for a longer period of time.
The tables below summarizes the 3 REITs performances for the latest quarter.
A+
Frasers Centrepoint Trust
As seen from the above table, FCT reported a strong quarter with increase in revenue, net property income, DPU and NAV. This despite the fact that Northpoint City is still about 18% vacant due to AEI. The strong showing comes from increase in occupancy in Changi City Point and Bedok Point, and 8.3% rental reversion for the past quarter.
I expect even better performance for the next two quarters with completion of Northpoint City. Also, with the opening of Downtown line, that will boost the traffic to Changi City Point.
The DPU might not jump in quantum as I think the proportion of management fees to be paid in Units will reduce from the current quarter of 70%. However, I believe that the management will want to continue to increase its DPU for the 12th straight year. Hence, I expect its DPU for next year will grow between 3% to 6%.
Also, with a low gearing of only 29%, acquisition of Punggol Waterway Point within the next few years is definitely a possibility.
The price of the counter has gone up quite a bit before the results is announced. It dipped to $2.17 recently which is not cheap with respect to its NAV of $2.02. However, with its proven track record and my thinking of its next year's DPU, I increased my stake by another 25%. With this increase, my average price is $2.06.
A
ParkwayLife REIT
Parkwaylife continues its stable and strong performance. Even excluding the divestment gain, its DPU has gone up by 2.9% compared to 2016Q3. For this financial year, its DPU has slowly increase too (Q1 3.06, Q2 3.10, Q3 3.15). No complain about it except that its price has really run up too much for me to accumulate further at this point. Might start considering again if yield increases to at least 4.8%.
C
Starhill Global REIT
All metric continues to drop as compared to a year ago but it seems to have stablized over the previous quarters. The key concern still lies with its office occupancy but the bright spot is management has shared that they are finalising the deal for 1/3 of its vacant space.
Going forward, things should look slightly brighter with the above, completion of Australia AEI and stable income from China properties. The price seems to have factored in the outlook as it hardly move after the announcement of the weaker results. I am going to continue to hold on to my current stake (average price of $0.70) which occupies 4.8% of portfolio.
Again, my definition of core holdings are counters which I am more familiar with. These are counters which I am more confident of and have a more substantial holding (about 5% of portfolio); hence I am more likely to hold them for a longer period of time.
The tables below summarizes the 3 REITs performances for the latest quarter.
Frasers Centrepoint Trust
As seen from the above table, FCT reported a strong quarter with increase in revenue, net property income, DPU and NAV. This despite the fact that Northpoint City is still about 18% vacant due to AEI. The strong showing comes from increase in occupancy in Changi City Point and Bedok Point, and 8.3% rental reversion for the past quarter.
I expect even better performance for the next two quarters with completion of Northpoint City. Also, with the opening of Downtown line, that will boost the traffic to Changi City Point.
The DPU might not jump in quantum as I think the proportion of management fees to be paid in Units will reduce from the current quarter of 70%. However, I believe that the management will want to continue to increase its DPU for the 12th straight year. Hence, I expect its DPU for next year will grow between 3% to 6%.
Also, with a low gearing of only 29%, acquisition of Punggol Waterway Point within the next few years is definitely a possibility.
The price of the counter has gone up quite a bit before the results is announced. It dipped to $2.17 recently which is not cheap with respect to its NAV of $2.02. However, with its proven track record and my thinking of its next year's DPU, I increased my stake by another 25%. With this increase, my average price is $2.06.
A
ParkwayLife REIT
Parkwaylife continues its stable and strong performance. Even excluding the divestment gain, its DPU has gone up by 2.9% compared to 2016Q3. For this financial year, its DPU has slowly increase too (Q1 3.06, Q2 3.10, Q3 3.15). No complain about it except that its price has really run up too much for me to accumulate further at this point. Might start considering again if yield increases to at least 4.8%.
C
Starhill Global REIT
All metric continues to drop as compared to a year ago but it seems to have stablized over the previous quarters. The key concern still lies with its office occupancy but the bright spot is management has shared that they are finalising the deal for 1/3 of its vacant space.
Going forward, things should look slightly brighter with the above, completion of Australia AEI and stable income from China properties. The price seems to have factored in the outlook as it hardly move after the announcement of the weaker results. I am going to continue to hold on to my current stake (average price of $0.70) which occupies 4.8% of portfolio.
Monday, 28 August 2017
Buy and sell actions in August
Lots of action this month. Divested a few counters but bought quite a bit with the $$$ from divestment of Best World.
Out of Favour
Divested Kingsmen Creatives at the same price I bought. This is the turnaround story that is not working out yet. It reported a poor Q2 and I decided to wait for a clearer picture before re-entering again.
Divested half my stake in ISEC at 0.315. Tiny profit. Still an interesting outfit but its growth isn't exciting enough for it to occupy the middle of my portfolio. Hence decided to hold less and watch how the story unfolds.
Sold Capital Mall Trust at 2.10. It has risen more than 10% from my purchased price. Covered 2 years of dividend. Will recycle cash to other counters that offer higher dividend yield. Might re-enter when it offers a better yield.
Sold Mircro-mechanics at 1.41. Bought purely for its track record for dividend but its price has gone up to 7 years of dividend due to its good performance. Decided to divest it as its dividend yield dropped below 5%. Surprised me with a second rise of dividend this year and with a 8 cents dividend, yield gone up to 5.6%. On hind side, should have continued to hold on to it but actually felt pretty neutral about it. Probably am satisfied with the above expectation return from the counter.
Up the Dividend
Bought a lot more counters especially REIT to increase my annual dividend. Also, I like their outlook from next year onward.
Added Fraser Centrepoint Trust at 2.07. With the AEI of North Point completing this year, next year DPU should increase. Assuming a 12 cents DPU next year, it will translate to 5.8% yield and potential upside if DPU is even higher. Possible catalyst could be acquisition of Punggol Waterway Point.
Added Starhill Global Reit at 0.76. While Orchard office occupancy could still pose a problem, AEI at Plaze Arcade in Australia is expected to be completed in 20181Q. China property would have a more stable distribution with the completion of renovation by 20174Q. Expecting a minimal 4.8 cents DPU next year. This translates to a 6.3% yield.
Bought CDL Hospitality Trust at 1.575. I have bought and sold CDLHT a couple of times for the past 4 years. Win some, lose some and overall still negative. Betting on the improvement of its hotels in the next two years. Assuming a 10 cents DPU, dividend yield is approximately 6.3%.
Bought Mapletree Commercial Trust at 1.55. A retail and office reit which I have missed for the longest time. Its DPU has been increasing since its listing. Estimating a 9 cents DPU which will give a 5.8% yield.
Bought VICOM at 5.81 (cd) and 5.65 (xd). A subdue Q2 results but with immediate effect it is paying out at least 90% of its earning as dividend. It gives more certainty that the company can maintain its dividend for the next two to three years even when revenue dropped due to increasing de-registration of cars. From 2020/21 onwards, it should see an increase in its revenue and income again with more vehicles requiring checking.
Buying into the Sell-down
Quite a number of counters were sold down for the past month, for good or questionable reasons. The sell-down provided me an opportunity to buy some shares of the counter which I think could do well in the future.
Bought Dairy Farm at USD7.45. The company has announced a decent Q2 recently and turnaround seems to gathering speed with good progress in China. The price was beaten down by 2% to 3% in one of the trading day and I deem it as an opportunity to add some.
Bought InnoTek at 0.34. The stock is beaten down because it reported a poor Q2. However, 1H is still an improvement. While the remaining year might remain a challenge, effort has been put in by management to turn the company around. Initiated the position with the belief that the turnaround will come in 2018 or 2019.
Bought mm2 Asia at 0.475. The price has dropped sharply after its GV deal did not get through. Nevertheless, it reported a good 1Q results and I decided to take a punt on it.
Bought HKLand at USD 7.46. Read about its cheap P/B and good results. Hence, decided to take a stake when its price has dropped by about 5% from its recent high.
Bought UMS at 0.995. The price has dropped sharply after guidance of moderate performance in 2H. Nimble a bit as I believe it will maintain its dividend which is a tasty 6%.
Bought 800 Super at 1.12. The price has dropped after a poor Q3. The price weakened further just before it announced its full year results. Took the opportunity to re-enter the counter which I have divested at 1.26 in April.
Bought Singapore O&G at 0.44. The price has dropped sharply after its weak Q2 results. Took a punt on it as company is still profitable and should get better results moving forward.
US Market
Most of my purchase decision for the US markets come from the recommendation of MF subscription services. Unlike my local counters, I did not do as much homework on them. While I think that the valuations of the counters are high, I like their future stories hence my stake in them. All my purchases are small and will slowly wait for opportunity to accumulate more shares in the future.
Bought Vail Resort at USD210.51. Luxury ski resorts operator. It has been growing through acquisition and opportunities to grow is still available. Its plan to keep its resort busy all-year round is working out well with Epic Discovery activities coming on more than one location.
Bought Cognex at USD105. Machine-Vision systems are used all around the world. Growth expected to continue.
Bought Priceline at USD1870. Good Q2 results but market is spooked by its lower Q3 guidance. Taking this opportunity to have one bite on it.
Bought Intuitive Surgical at USD935. Intuitive Surgical have been growing for many years and its recurring income has increased. Decided to buy 2 shares to participate in its growth even though it has a high PE of 44x.
Out of Favour
Divested Kingsmen Creatives at the same price I bought. This is the turnaround story that is not working out yet. It reported a poor Q2 and I decided to wait for a clearer picture before re-entering again.
Divested half my stake in ISEC at 0.315. Tiny profit. Still an interesting outfit but its growth isn't exciting enough for it to occupy the middle of my portfolio. Hence decided to hold less and watch how the story unfolds.
Sold Capital Mall Trust at 2.10. It has risen more than 10% from my purchased price. Covered 2 years of dividend. Will recycle cash to other counters that offer higher dividend yield. Might re-enter when it offers a better yield.
Sold Mircro-mechanics at 1.41. Bought purely for its track record for dividend but its price has gone up to 7 years of dividend due to its good performance. Decided to divest it as its dividend yield dropped below 5%. Surprised me with a second rise of dividend this year and with a 8 cents dividend, yield gone up to 5.6%. On hind side, should have continued to hold on to it but actually felt pretty neutral about it. Probably am satisfied with the above expectation return from the counter.
Up the Dividend
Bought a lot more counters especially REIT to increase my annual dividend. Also, I like their outlook from next year onward.
Added Fraser Centrepoint Trust at 2.07. With the AEI of North Point completing this year, next year DPU should increase. Assuming a 12 cents DPU next year, it will translate to 5.8% yield and potential upside if DPU is even higher. Possible catalyst could be acquisition of Punggol Waterway Point.
Added Starhill Global Reit at 0.76. While Orchard office occupancy could still pose a problem, AEI at Plaze Arcade in Australia is expected to be completed in 20181Q. China property would have a more stable distribution with the completion of renovation by 20174Q. Expecting a minimal 4.8 cents DPU next year. This translates to a 6.3% yield.
Bought CDL Hospitality Trust at 1.575. I have bought and sold CDLHT a couple of times for the past 4 years. Win some, lose some and overall still negative. Betting on the improvement of its hotels in the next two years. Assuming a 10 cents DPU, dividend yield is approximately 6.3%.
Bought Mapletree Commercial Trust at 1.55. A retail and office reit which I have missed for the longest time. Its DPU has been increasing since its listing. Estimating a 9 cents DPU which will give a 5.8% yield.
Bought VICOM at 5.81 (cd) and 5.65 (xd). A subdue Q2 results but with immediate effect it is paying out at least 90% of its earning as dividend. It gives more certainty that the company can maintain its dividend for the next two to three years even when revenue dropped due to increasing de-registration of cars. From 2020/21 onwards, it should see an increase in its revenue and income again with more vehicles requiring checking.
Buying into the Sell-down
Quite a number of counters were sold down for the past month, for good or questionable reasons. The sell-down provided me an opportunity to buy some shares of the counter which I think could do well in the future.
Bought Dairy Farm at USD7.45. The company has announced a decent Q2 recently and turnaround seems to gathering speed with good progress in China. The price was beaten down by 2% to 3% in one of the trading day and I deem it as an opportunity to add some.
Bought InnoTek at 0.34. The stock is beaten down because it reported a poor Q2. However, 1H is still an improvement. While the remaining year might remain a challenge, effort has been put in by management to turn the company around. Initiated the position with the belief that the turnaround will come in 2018 or 2019.
Bought mm2 Asia at 0.475. The price has dropped sharply after its GV deal did not get through. Nevertheless, it reported a good 1Q results and I decided to take a punt on it.
Bought HKLand at USD 7.46. Read about its cheap P/B and good results. Hence, decided to take a stake when its price has dropped by about 5% from its recent high.
Bought UMS at 0.995. The price has dropped sharply after guidance of moderate performance in 2H. Nimble a bit as I believe it will maintain its dividend which is a tasty 6%.
Bought 800 Super at 1.12. The price has dropped after a poor Q3. The price weakened further just before it announced its full year results. Took the opportunity to re-enter the counter which I have divested at 1.26 in April.
Bought Singapore O&G at 0.44. The price has dropped sharply after its weak Q2 results. Took a punt on it as company is still profitable and should get better results moving forward.
US Market
Most of my purchase decision for the US markets come from the recommendation of MF subscription services. Unlike my local counters, I did not do as much homework on them. While I think that the valuations of the counters are high, I like their future stories hence my stake in them. All my purchases are small and will slowly wait for opportunity to accumulate more shares in the future.
Bought Vail Resort at USD210.51. Luxury ski resorts operator. It has been growing through acquisition and opportunities to grow is still available. Its plan to keep its resort busy all-year round is working out well with Epic Discovery activities coming on more than one location.
Bought Cognex at USD105. Machine-Vision systems are used all around the world. Growth expected to continue.
Bought Priceline at USD1870. Good Q2 results but market is spooked by its lower Q3 guidance. Taking this opportunity to have one bite on it.
Bought Intuitive Surgical at USD935. Intuitive Surgical have been growing for many years and its recurring income has increased. Decided to buy 2 shares to participate in its growth even though it has a high PE of 44x.
Tuesday, 15 August 2017
Top 10 Counters Quarterly Reporting (July to September)
With the exception of Micro-Mechanics, the rest of my top 10 counters have reported their quarterly report. I will update this post with MMs results when it is out later this month which I believe would be a good.
With the divestment of Best World in July, my recent purchase of VICOM has taken the last place of my top ten counters. I will post on the purchase of VICOM soon.
The tables below summarize their performances for the latest quarter.
A+
The company also produces a presentation for 20181Q report which provides a good read of the company's business. Barring unforeseen circumstances, I expect the business to continue to do well for this year. Hence, I will continue to hold on to my shares.
Straco
Straco has a good quarter as its revenue and net profit continues to grow. With the exception of UWX, the rest of its attractions - SOA, SF and Lixing cable car saw higher visitor numbers.Straco's NPM has always been above 30% and with little capex, it is generate lots of cash that allows it to pare down its debt.
I am hopeful for an increase in dividend either for this financial year, if not by next financial year.
Micro-Mechanics
Micro-Mechanics reported a good quarter with another increase in dividend. However, I decided to divest it just before it announces its results. Hence, I will not update its performance.
A
ParkwayLife REIT
ParkwayLife continues to improve its DPU y-o-y and q-o-q. With the distribution of its divestment gain over the four quarters, the return is even more impressive. Management has good track record in improving DPU and has make gains from its divestment. They are also forward looking and in the latest report has indicated the decision to diversify their portfolio by investing in properties used for medical manufacturing & storage facilities & education facilities (target 5% of portfolio).
The price has run up quite a bit in the last few months and it is indeed tempting to lock in some profit. However since I still believe in its long term growth, I will hold on to my current holdings.
Frasers Centrepoint Trust
FCT reported a stable quarter with slight decline in its DPU. With its AEI for Northpoint 90% completed, DPU should improve next year. With a low gearing of only 30%, one possible catalyst would be acquisition of Punggol Waterway Point within the next few years.
I will look for opportunity to accumulate more if the price softens.
B
Food Empire
Food Empire continues its turnaround story with an exceptional increase in both revenue and net profit y-o-y. However, q-o-q the results is not as impressive and the its NPM is not very stable.
In Q1, Indochina's weaker performance was attributed to a change in festive season date. However, Q2 results does not see a big change. Hence, as management highlighted in the report, they are facing tough competition. The strongest segment is their Other Markets which improves both y-o-y and q-o-q.
Based on past record, it seems that their 2H performance is better than 1H. If they are able to achieve the improvement in Q3, I will up them to the A Band.
Singtel
Strong growth in revenue but net profit suffers due to intense competition in India. NPM remains high at above 20%. Singtel should be able to maintain its dividend and hopeful for special dividend when it records its gain from its divestment of Netlink.
VICOM
Revenue and net profit continues to drop due to decrease in car inspection because of COE cycle. However, company has pretty much maintain its dividend and has up its dividend policy to 90% payout.Strong net profit margin of above 20% and if it is able to maintain similar dividend for just a few more years, its revenue and net profit will grow again.
Will look for opportunity to increase stake.
C
Raffles Medical Group
Slightly better than 20171Q, with revenue up by 1.0% and net profit up by 0.7% as compared to 20161Q. Q-o-Q, the improvement is better.
The report highlighted weaken demand from foreign patients but it still generated more than enough sufficient cash to support its expansion. Raffles Hospital Extension will open in Q4, Raffles Chongqing in 2018 second half and Raffles Shanghai in 2019 second half.
The market responded badly with this Q2 results, causing the price to drop to below $1.2. I will take the opportunity to further accumulate my holding at the correct price. Expect to see the benefits from its expansion from 2020 onwards.
Starhill Global REIT
DPU continues to drop due to poor performance for its office segment and AEI for Plaza Arcade. As with Q1 report, I stay satisfied with the current DPU and actions taken by the management. I expect a better performance in 2018, hence may buy more if the price is good.
With the divestment of Best World in July, my recent purchase of VICOM has taken the last place of my top ten counters. I will post on the purchase of VICOM soon.
The tables below summarize their performances for the latest quarter.
A+
Valuetronics
Fantastic quarter by Valuetronics as it continues its turnaround with strong momentum in wireless lighting business and continuous growth in automotive segment. NPM average 6.9% over the last four quarters, much higher than the average of 6.2% in the preceding 4 quarters. A good decision made by management to exit LED business and go into automotive segment.
The company also produces a presentation for 20181Q report which provides a good read of the company's business. Barring unforeseen circumstances, I expect the business to continue to do well for this year. Hence, I will continue to hold on to my shares.
Straco
Straco has a good quarter as its revenue and net profit continues to grow. With the exception of UWX, the rest of its attractions - SOA, SF and Lixing cable car saw higher visitor numbers.Straco's NPM has always been above 30% and with little capex, it is generate lots of cash that allows it to pare down its debt.
I am hopeful for an increase in dividend either for this financial year, if not by next financial year.
Micro-Mechanics
Micro-Mechanics reported a good quarter with another increase in dividend. However, I decided to divest it just before it announces its results. Hence, I will not update its performance.
A
ParkwayLife REIT
ParkwayLife continues to improve its DPU y-o-y and q-o-q. With the distribution of its divestment gain over the four quarters, the return is even more impressive. Management has good track record in improving DPU and has make gains from its divestment. They are also forward looking and in the latest report has indicated the decision to diversify their portfolio by investing in properties used for medical manufacturing & storage facilities & education facilities (target 5% of portfolio).
The price has run up quite a bit in the last few months and it is indeed tempting to lock in some profit. However since I still believe in its long term growth, I will hold on to my current holdings.
Frasers Centrepoint Trust
FCT reported a stable quarter with slight decline in its DPU. With its AEI for Northpoint 90% completed, DPU should improve next year. With a low gearing of only 30%, one possible catalyst would be acquisition of Punggol Waterway Point within the next few years.
I will look for opportunity to accumulate more if the price softens.
B
Food Empire
Food Empire continues its turnaround story with an exceptional increase in both revenue and net profit y-o-y. However, q-o-q the results is not as impressive and the its NPM is not very stable.
In Q1, Indochina's weaker performance was attributed to a change in festive season date. However, Q2 results does not see a big change. Hence, as management highlighted in the report, they are facing tough competition. The strongest segment is their Other Markets which improves both y-o-y and q-o-q.
Based on past record, it seems that their 2H performance is better than 1H. If they are able to achieve the improvement in Q3, I will up them to the A Band.
Singtel
Strong growth in revenue but net profit suffers due to intense competition in India. NPM remains high at above 20%. Singtel should be able to maintain its dividend and hopeful for special dividend when it records its gain from its divestment of Netlink.
VICOM
Revenue and net profit continues to drop due to decrease in car inspection because of COE cycle. However, company has pretty much maintain its dividend and has up its dividend policy to 90% payout.Strong net profit margin of above 20% and if it is able to maintain similar dividend for just a few more years, its revenue and net profit will grow again.
Will look for opportunity to increase stake.
C
Raffles Medical Group
Slightly better than 20171Q, with revenue up by 1.0% and net profit up by 0.7% as compared to 20161Q. Q-o-Q, the improvement is better.
The report highlighted weaken demand from foreign patients but it still generated more than enough sufficient cash to support its expansion. Raffles Hospital Extension will open in Q4, Raffles Chongqing in 2018 second half and Raffles Shanghai in 2019 second half.
The market responded badly with this Q2 results, causing the price to drop to below $1.2. I will take the opportunity to further accumulate my holding at the correct price. Expect to see the benefits from its expansion from 2020 onwards.
Starhill Global REIT
DPU continues to drop due to poor performance for its office segment and AEI for Plaza Arcade. As with Q1 report, I stay satisfied with the current DPU and actions taken by the management. I expect a better performance in 2018, hence may buy more if the price is good.
Saturday, 1 July 2017
Looking Ahead
Having achieved a good first half results, the question is how to improve or sustain it? Best World, Food Empire and Valuetronics were the key drivers of my first half performance. Will they continue to do well in the next few years? Will other counters take over the driver seat?
I decided to make a prediction on the above questions base on my current, limited knowledge of their business and gut feel. Of course, this is speculative in nature but it provides a rough idea how my portfolio might continue to grow in the next few years.
I must say I am quite satisfied after the exercise as there seem to be sufficient stories to keep my portfolio going. What about the other counters that did not even appear once in this post? I will write about them in the next post.
20172H
Food Empire - Turnaround should continue with positive results.
Valuetronics - Both CE and ICE segments will continue their growth momentum.
Best World - China story is in tact and should continue to power its growth.
SingTel - Launch of Netlink IPO should have a positive impact.
Micromechanics - Continue to benefit from its strategic decision to focus on semiconductor.
ISEC? Improvement in results, partly contributed by the acquisition of JLM clinics in 2016?
2018
Food Empire - Growth rate should be lower as compared to 2017. Expect growth from other markets, especially from the ingredient segment.
Valuetronics - At least for first half of the year with their automotive segment continues to gain traction.
Best World - This year should see more conversion of China export model to direct sales. Margin should improve.
Frasers Centrepoint Trust - DPU boosted by Northpoint AEI in 2017.
Starhill Global REIT - DPU boosted by completion of Plaza Arcade redevelopment by 20181Q.
Straco? Will it increase its dividend?
Kingsmen Creatives? Will this be the turnaround year?
Raffles Medical Group? Unlikely, but will the new extension start to make a difference?
Duty Free International? Expansion or increase dividend from their cash hoard?
2019
Straco - Either acquisition or increase dividend if it did not do so in 2018.
Capital Mall Trust - DPU boosted from re-opening of Funan in 2018.
Raffles Medical Group? Contribution from Extension and Raffles Chongqing but may face start-up cost pressure from Raffles Shanghai.
Best World? Will it continue to grow?
Frasers Centrepoint Trust? Acquisition of Waterway Point? or in 2020 or 2021?
Starhill Global REIT? Orchard office turnaround?
Kingsmen Creatives? Continue its turnaround?
Frasers Logistic and Industries Trust? More acquisition?
2020/2021
Raffles Medical Group - Reaping the fruit of its expansion.
Straco - Further increase in dividend.
2017 1H Performance
Half a year has passed and it's time to report on portfolio performance again. Happy to report a good half yearly performance with a good second quarter riding on an exceptional first quarter.
Performance
NAV of portfolio grew from $3.78 (30 Dec 2016) to $5.17 (30 Jun 2017), providing a return of 36.6% for 6 months. This is above my stretched target of 12% and also beats my benchmark STI ETF which returned 14.6% inclusive of dividend over the same period. The charts below show the past 6 quarters and past 3 half-yearly performances. The drop in prices of a few counters in the past few weeks have weakened Q2 results but nonetheless a 9.0% return is a good one which I will take for any other year. The exception Q1 performance has also led to the best half yearly performance.
The strong performance is attributed to a combination of positive sentiment in the local market and good results reported from my top ten counters over the past two quarters. A summary of my top ten counters' last quarter performance can be found here.
The top performers continues to be Best World. After stock split and dividend, it has returned 127% this year. This is supported by core stock such as Valuetronics (47%), Food Empire (35%), Micro-Mechanics (32%), Straco (19%), Parkway Life Reit (15%), and Frasers Centrepoint Trust (14%).
ISEC which is not in the top ten also did well with an increase of 10%.
Allocation
While there were some changes in the counter, portfolio allocation has more or less stayed similar to what was planned. Current dividend yield of portfolio based on cost is about 4.7%.
Planned
|
Actual
| |
Dividend
|
~ 60%
|
58.0%
|
REIT/ Business Trust
|
<= 30%
|
25.8%
|
Growth
|
~ 40%
|
40.1%
|
Punt
|
<=10%
|
9.4%
|
Cash
|
0%
|
1.9%
|
Earlier in the month, I have also wrote about asset allocation in which I have written that I am going for 30% cash and 70% stock allocation. A check on my spreadsheet shows that it is at this allocation. So no action will be taken to put in or take out cash from the portfolio.
Action
For the month of June,
I have divested
- A-REIT at $2.65 for a gain of 19%. Bought last December for a tantalising 7% yield for industry leader. With the recent gain, I have received more that 2 years of distribution and yield has dropped below 6%.
- Techwah at $0.515 for a gain of 10%. Reason for sale is to raise cash for other counters.
- more Frasers Logistic and Industrial Trust at $1.03 after news of its latest acquisition. I take this as sign of how things will be like in the years to come.
- Japan Food at $0.46 for its consistent dividend. If it can maintain its dividend, it will give me a return of 4.3%. Not fantastic, so hope it will be higher in future.
- Duty Free International at $0.35 for its increase cash hoard and possible expansion in the next few years.
- Valuetronics at $0.77 to round up my holdings. Also, I am satisfied with the 4.7% dividend yield it is giving me.
Core holdings
Based on initial cost, the top 10 holdings take up 74.9% of the portfolio. With the purchase of Food Empire and Valuetronics, they have moved up in positions. The rest has remains pretty stable.
- Food Empire (9.7%) @ $0.43
- Raffles Medical (9.5%) @ $1.48
- Parkwaylife REIT (8.9%) @ $2.32
- Valuetronics (8.6%) @ $0.54
- Straco (8.1%) @ $0.84
- Best World (7.7%) @ $0.30
- Fraser Centrepoint Trust (6.4%) @ $2.01
- SingTel (6.1%) @ $3.82
- Micro-Mechanics (5.8%) @ $0.91
- Starhill Global (4.3%) @ $0.67
Looking Ahead
It has been a wonderful ride so far this year. Not sure how long the good time is going to last but enjoying it while it lasts. Looking forward to the release of next round of quarterly results from my holdings and am confident of good results from most of my holdings.Similar to first half, I do not think there will be much action on my core holdings. However, I might tingle a bit more with my none-core.
Up next, I will post on a short visibility report of my various holdings for the next few years.
Monday, 29 May 2017
Top 10 Counters Quarterly Reporting (April to June)
All my counters have reported their performance for the period. Below is a short summary of my top 10 counters' performances.
Food Empire reported its 20171Q results on 11 May. An excellent set of results as its revenue is up by 23.6% and net profit up by 57.2%. The performance is attributed to appreciation of Russian Ruble against the USD, change of business model in Kazakhstan and CIS markets, and higher sales in ingredient segment. The drop in Indochina market is due to different festive timing.
Looking forward to the next quarter results with eyes on its Indochina and ingredient segment.
RMG reported its 20171Q results on 23 April. As expected, its revenue and net profit are flat, dipping by 1.7% as compared to 21061Q. Its expansion plan is within timeline with Raffles Hospital Extension to open in Q4. The group also recently acquired a land with an in-construction building in Chongqing for a 700-bed international tertiary hospital. This will be completed by 2Q2018, earlier than the Shanghai Hospital what is slated to be ready by end 2018.
I think the group is doing well as it is able to maintain its profit amid its expansion. I will continue to hold on to my stake and participate in its script dividend (latest at $1.26) scheme. Expect to see the benefits from its expansion from 2019 or 2020.
PLife reported its 20171Q on 24 April. DPU for the quarter is up by 9.6% due to its divestment gain in 2016. Recurring DPU goes up by 2.2%. As highlighted in its presentation, it has strong capital structure. There is no long term re-financing cost till 2019, interest cover of 10.0 times and gearing at 36.7%.
While its share price is trading at a premium to NAV, I believe the quality of this REIT deserves that. This will stay in my portfolio for a long time.
Straco reported a decent set of 20171Q results on 9 May. Revenue is up by 4.2% with net profit up by 6.9%. It has reported a double digit growth in the visitation number to SOA, while number of visitors to UWX grows by 9.7%. Singapore Flyer's visitor number is stable but revenue grow increased on better yield and F&B revenue.
As mentioned before, I like its cash business and am hopeful that dividend payout will increase in a few years time when they pare down their debt.
Best World International Limited
Best World reported another excellent 20171Q results on 9 May. Revenue is up by 27.0% and net profit up by a whooping 63.1%. The excellent performance is attributed to the tremendous growth in of 110% in its export segment (read China market). The increase is attributed to backlog and inventories building as demand is expected to be high. It could be that while Q2 results continue to be positive, it might not see the jump seen in Q1. Slight concern is the drop in Taiwan DS for 1Q but management has guided subdue growth for the year.
My stance remains unchanged. China market provides huge potential for its growth but it has garnered lots of attention and price has gone up a lot since the award of its China DS license. Expect volatile price movement and huge drop if any of the coming quarters perform below expectation.
Valuetronics reported its 2017 full year results on 25 May. After deciding to exit mass LED market in 2015 and moving into automotive sector in2016, Valuetronics finally turnaround its results. Revenue is up by 16.5% and net profit grows by 27.9%, one of the highest since it has listed. The improvement is also attributed to a surge in order on wireless LED since 21063Q. While I am not in the industry, I believe it will go in the way of mass LED after a few years. Nevertheless, it's good business for the next few years. The group is undergoing qualification by another automaker and expect to obtain approval by late FY2018.
With 1-to-10 bonus and maintaining its dividend, this had indirectly increase my dividend by 10%. I am hopeful of the group's performance for the next few years, so will continue to hold on to my stake.
FCT reported its 20172Q on 25 April. Revenue dipped by 2.9% and net profit income by 3.3%. However, tt has maintained its DPU at 3.04 cents. All these are achieved despite AEI work for Northpoint with average occupancy of about 63% during this period.
Will continue to hold FCT for its resilient position.
Singtel reported its full year results on 18 May. Revenue dipped by 1.5% for the year and net profit excluding exceptional item goes up by 0.9%. Singtel continues to pay a total of 17.5 cents of dividend at a payout ratio of 73%. Singapore and Australia provided stable return but India Airtel affected by price war due to new operator.
Will re-evaluate position after its Netlink IPO.
Micro-Mechanics reported its 20173Q results on 28 April. For the second consecutive quarters, it has improved its revenue and earning. For 9M, revenue is up by 9.0% and net profit up by 12.8%. It does seem that their strategical review last year to focus the engineering, development and investment efforts of the Group’s five factories on serving the
semiconductor industry is working. Utilisation rate has gone up to 59% for Q3.
It seems that Micro-Mechanics will do well for the next few years and with its dividend policy of not less than 40%, this should continue to be a good investment.
Starhill Global reported its 20173Q results on 27 April. Gross revenue dipped by 0.6%, net profit income dipped by 0.9%, income available for distribution dropped by 3.1% and DPU dropped by 6.3%. This has been a tough year from SG Reit due to lower occupancy of office space especially at Wisma Atria, and re-positioning of the China mall. The positive comes from Lot 10 rejuvenation and upcoming AEI at Plaza Arcade.
I am satisfied with the current DPU and actions taken by the management. Should see better performance in 2018.
Looking forward to the next quarter results with eyes on its Indochina and ingredient segment.
I think the group is doing well as it is able to maintain its profit amid its expansion. I will continue to hold on to my stake and participate in its script dividend (latest at $1.26) scheme. Expect to see the benefits from its expansion from 2019 or 2020.
While its share price is trading at a premium to NAV, I believe the quality of this REIT deserves that. This will stay in my portfolio for a long time.
As mentioned before, I like its cash business and am hopeful that dividend payout will increase in a few years time when they pare down their debt.
Best World reported another excellent 20171Q results on 9 May. Revenue is up by 27.0% and net profit up by a whooping 63.1%. The excellent performance is attributed to the tremendous growth in of 110% in its export segment (read China market). The increase is attributed to backlog and inventories building as demand is expected to be high. It could be that while Q2 results continue to be positive, it might not see the jump seen in Q1. Slight concern is the drop in Taiwan DS for 1Q but management has guided subdue growth for the year.
My stance remains unchanged. China market provides huge potential for its growth but it has garnered lots of attention and price has gone up a lot since the award of its China DS license. Expect volatile price movement and huge drop if any of the coming quarters perform below expectation.
With 1-to-10 bonus and maintaining its dividend, this had indirectly increase my dividend by 10%. I am hopeful of the group's performance for the next few years, so will continue to hold on to my stake.
Will continue to hold FCT for its resilient position.
Will re-evaluate position after its Netlink IPO.
It seems that Micro-Mechanics will do well for the next few years and with its dividend policy of not less than 40%, this should continue to be a good investment.
I am satisfied with the current DPU and actions taken by the management. Should see better performance in 2018.
Sunday, 12 February 2017
January and February Portfolio
It has been a busy past 6 weeks. Things are finally looking to settle a bit and it's time to continue to keep in touch with my thinking and reflection on my investment.
It has been a good start to the year for the market and my portfolio also benefitted from it. Year to date, it has returned 12.8%. Woohoo, I hit my target in less than two months. So would I achieve another 40% return this year? I hope so but you never know. Who knows? The market might just turn south any time. So continue to monitor the company's performance and invest/divest at the right time for the long term.
I have divested the following for the first one and a half month to increase my cash buffer and to reduce my REIT exposure.
It has been a good start to the year for the market and my portfolio also benefitted from it. Year to date, it has returned 12.8%. Woohoo, I hit my target in less than two months. So would I achieve another 40% return this year? I hope so but you never know. Who knows? The market might just turn south any time. So continue to monitor the company's performance and invest/divest at the right time for the long term.
I have divested the following for the first one and a half month to increase my cash buffer and to reduce my REIT exposure.
- Best World: Partial sold as it has rose more than 50% within a month. It continue to be in my top 5 stocks holding.
- Thai Beverages: Among the few counters that I punted, I am just more excited about the rest.
- Raffles Medical Group: Partial sold to reduce my exposure. Remain my top stock in terms of initial capital outlay.
- CDLHT: To reduce my REIT exposure to within 30%.
- Starhill Global: To reduce my exposure to retail reit. And currently I favour neighbourhood reit more.
I have added the following positions.
- Valuetronics: Increased my stake slightly for its dividend.
- UMS: Bought a small stake after reading its plan to divest its customer base and attracted by its consistent dividend.
- Micro-mechanics: Increased my stake after it announced its good improvement in its latest quarter. Attractive dividend and potential of further growth.
- Dutech: Took a very small stake after reading Thumbtack Investor's detailed analysis
- Sing Medical: Took a very small stake as I perceived that the new management will continue to improve the group's performance
- Fraser Logistics and Industrial Trust: Took a very small stake after reading about it on The Edge and Dividend Warrior's analysis.
After the above actions, my top 5 holdings in terms of initial capital outlay are:
- RMG @ average price of $1.48
- Plife Reit @ average price of $2.32
- Straco @ average price of $0.84
- BWL @ average price of $0.60
- FCT @ average price of $2.01
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