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Friday, September 30, 2016

My Investment Portfolio (September 2016)

STI closed this month higher at around 2869 points.It could have been much better if not for the concerns on Deutsche Bank's financial health towards the end of the month. The expectation of only one more interest rate hike in US this year and also prospects of higher oil price due to Opec's consensus on oil production output cut are the positives for this month.

For this month, I have attended the following AGMs/EGMs/briefings - IFS Capital, SGX, Tee International, GMG Global and SMRT.

For my top 30 holdings, United Engineers regained top spot after major shareholders of the company, OCBC and Great Eastern Holdings said that they are currently reviewing strategic options with respect to their combined stake in the company. Keppel T&T also did well after a positive brokerage report being issued on the company. Sarine Technologies did not do well though, as investors took profit on the stock after a good run.

I have bought the following companies from the market this month - Broadway, CEI, Cheung Woh, Elec & Eltek, Excelpoint, Far East Orchard, Federal, GLP, Hiap Hoe, Hiap Seng, Hotel Grand Central, Hwa Hong, iFAST, K1 Ventures, Karin, Keppel Corp, Koh Brothers, LH, Low Keng Huat, Lum Chang, Multi-Chem, Pacific Century, Plato Capital, SembCorp Industries, SingTel, Sunningdale, Tan Chong International, TIH, UIC, United Engineers, UOA, UPP and Wing Tai. No sell trade was done.

I have participated in the following scrip dividend schemes this month - DBS and Vibrant Group. I have also accepted the following voluntary delisting/cash offer this month - Eu Yan Sang. My stake in HTL International was also being acquired via scheme of arrangement.

October will be another busy month for me as companies with financial year ending 30 June 2016 will be holding their AGMs. As usual, I will be attending some of them to get updates on their business performance and outlook.

My S'pore Stock Portfolio - Top Holdings, cash investment only (correct as at 30 September 2016)

Top 30 Holdings (Sing$ Denominated shares)
1. United Engineers
2. Best World  
3. Jardine C&C
4. Keppel T&T
5. Bonvests
6. Haw Par
7. Metro Holdings
8. Sarine Technologies
9. Hotel Royal
10. Hotel Grand Central
11. Hong Fok
12. A-REIT
13. SGX
14. Singapura Finance
15. GK Goh
16. Bukit Sembawang Estates
17. Old Chang Kee
18. UOL
19. Far East Orchard
20. ComfortDelgro
21. The Hour Glass
22. Hong Leong Finance
23. Hotel Properties
24. CapitaMall Trust
25. First REIT
26. Hiap Hoe
27. Colex
28. CapitaLand
29. Sing Investment & Finance
30. Isetan 

Top 5 Holdings (US$ Denominated shares)
1. Jardine Strategic
2. Hong Kong Land 
3. Mandarin Oriental  
4. Jardine Matheson
5. Dairy Farm 

Top Holdings (HK$ Denominated shares)
1. Fortune REIT
2. Shangri-La Asia

Top Holdings (Aust$ Denominated shares)
1. AV Jennings

Top 5 Holdings (CPF OA investment)
1. Keppel Corp
2. Streettracks STI ETF
3. CapitaMall Trust
4. A-REIT
5. Challenger Technologies

My Hong Kong Stock Portfolio
1. Peace Mark Holdings - Under Voluntary Liquidation

My Australia Stock Portfolio
1. GPS Alliance Holdings Limited

My Unlisted Company Portfolio
1. Automated Touchstone Machines Ltd
2. Iconic Global Limited
3. Dongshan Group Ltd (formerly known as Greatronic Limited)
4. General Magnetics
5. Fastech Synergy
6. Beauty China- Under Liquidation
7. Memory Devices
8. Jurong Tech - In liquidation - Compulsory winding up (Insolvency)
9. FM Holdings
10. Zhonghui - In liquidation - Compulsory winding up (Insolvency)
11. FerroChina - Under Liquidation
12. FirstLink Investments
13. NEL Group
14. Jets Technics
15. Guangzhao Industrial Forest - In liquidation - Compulsory winding up (Insolvency)
16. Hongwei Technologies Limited (In Provisional Liquidation)
17. FDS Networks Group
18. Aussino Group - In liquidation - Creditors' voluntary winding up
19. China Oilfield Technology
20. China Milk Products Group - Under Liquidation
21. Pacific Healthcare

My Unit Trust Portfolio:
http://www.fundsupermart.com/main/community/Portfolio_View.svdo?id=P199

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30 Comments:

Blogger JTK said...

Hi GHChua

Thank you for the sharing every month. I would like to ask you a few questions.

Does K1 Ventures still have value with PB ratio of 2?

What is your view on Debt level of Wing Tai and Hiap Hoe? Is it a concern?
Aren't Bukit Sembawang and Wheelock better buys?

Any rationale behind purchasing Hiap Seng again after the price run-up?

What is your take on iFast price drop and high PE?

Thank you
JTK

10:36 PM  
Blogger ghchua said...

Hi JTK,

For K1 Ventures, I purchased the stock from the unit share market, as there is a price discount from the normal market. At its current price, I agree with you that it is a bit overvalued but some of the stuff in the books had been priced at cost. We would not know the real value of these assets unless they sold them.

For Hiap Hoe, its debt level is not that high, considering the fact that they have hotels in S'pore and Australia, assets from Superbowl which they acquired a few years ago, commercial and residential buildings in Australia, Singapore etc. Do take note that their assets in Australia is freehold. The company had been quite low profile lately, and I believe that the company could be taken private in the near future.

For Wing Tai, gearing is high but that is because they have unsold residential properties. I do agree with you that the debt level is a risk, which is why it is not in my top 30 holdings.

Bukit Sembawang is one of my top 30 holdings and therefore I do like the stock. I didn't add onto it last month, but I did make some purchases this year. Do check back my previous postings. For Wheelock, I do like the stock but it did some misadventures for the past few years and their developments are not moving fast. I do see it as another asset and privatisation play and it is in my portfolio, though not in my top 30 list.

For Hiap Seng, I don't see the rationale of not purchasing a stock after a run-up. As long as it is still trading at a decent valuation, I will continue to buy the stock. The company is still trading below its NAV of more than 20cts with an order book of more than $130m. In fact, the 1cts dividend they paid out last FY was only 50% of their earnings and it is already yielding more than 7%pa at its current share price.

PE is not a good way to measure iFAST simply because it operates on an asset light business model. Its earnings is low this year simply because the stock market is not doing well and therefore sales volume is low. In fact, a good way to look at iFAST is the AUM under their management. That will give you an idea whether they can sustain their recurring income. If you based on PE, you will always get a very high one when market is not doing well.

Hope that the above helps.

2:10 AM  
Blogger JTK said...

Hi GHChua

Thank you very much for the answers and explanations.

4:15 AM  
Blogger Sunny said...

Dear Chua,

tks for blogging.

How about Heeton? Since you like Hiap Hoe. Do you like AF Global and why?

11:56 PM  
Blogger ghchua said...

Hi Sunny,

I do hold Heeton in my portfolio but not a big stake because I do not like their high gearing and also they are stuck with unsold properties (especially those that they fully owned) which might incur penalties in future. With the property market in S'pore still not looking good, it is a bit risky to invest in Heeton but nevertheless, I took the risk because of its high NTA. I hope that they can move their properties soon.

I did owned AF Global (formerly known as LCD Global Investments) before but I have accepted the takeover offer from Mr Koh and did not look at the stock since then. It certainly look interesting now, since it had corrected back to below 20cts. But it had given out a few rounds of dividends since the takeover, and therefore might not be that attractive in terms of valuation. I do own Aspial and it is an indiect play to AF Global.

AF Global's properties in China is selling slowly and it will take sometime for it to perform. I will certainly re-visit the stock again and see whether it is worth buying in.

8:32 AM  
Blogger Sunny said...

Chua

Tks for reply. If you would re-enter AF one day, dont mind let me know at sunnylr0904@gmail.com? Or let us know somewhere in your blog if you feel not so convinent to contact me as above.

Tks

5:47 PM  
Blogger Sunny said...

Same like you, I also hold UE for years. If offer comes, what wld you do? can still enter metro at current price?

5:51 PM  
Blogger Ho Yoke Ming said...

Hi Ghchua,

I found your blog by chance and your investment acumen is really impressive.

I saw that NTU was in your list of charities and maybe you're an alumni like me too. Also, I noticed that you have blog links to some of the bloggers that I personally know, like BullytheBear.

I have also written a simple article on einvesthub before, even though I'm not a blogger. you can check it out here: http://einvesthub.btinvest.com.sg/markets/2016/06/03/3-simple-steps-to-start-stock-investing/

I've been searching everywhere in your blog for your contact details but I haven't found any, and that's why I'm posting a comment here. (hopefully you won't think it's a spam)

Is there any where else we could connect? like via email? You can email at ymho33@gmail.com.

I look forward to your reply. Thanks!

9:38 PM  
Blogger Sooyean Hoo said...

Hi Mr Ghim Hock & fellow investors,
This is a really good platform to learn about investment.
I have 2 qns:

1)May I know where beside the Annual Reports, where can we get the NAV of a company?

2)Also may I know what is good dividend or yield, should novice like me, go for?
A quick check shows that you are targeting around 5% for your tops choices.

Is that a good number for us novices?

Thanks.

5:44 AM  
Blogger Ho Yoke Ming said...

Hi Sooyean,

Since you've asked, to find a NAV of a company, you can visit investingnote.com.

An example here is when you search for 'DBS' : http://www.investingnote.com/stocks/D05#/?stock=D05&tab=all

6:08 AM  
Blogger Keat Eu said...

Hi Chua, Havee been following your blog for a while. Your blog gives more confidence in pursuing long term investment goal rather than focusing on trading or speculation.

5:28 PM  
Blogger ghchua said...

Hi Sunny,

Thanks for your support of my blog. As you know, I will post a monthly update on my portfolio at this blog and therefore, you would be able to know whether I have re-entered AF Global. As I've said before, this stock is interesting at current levels but I need to do more research in order to see whether it is an attractive value buy.

About UE, if and when an offer comes, I will have to see whether it is attractive or not before making any decision whether to accept or reject the offer. Therefore, it is still early to comment on it now. Having said that, UE's RNAV is around $3.30 per share and that might be the benchmark that you wish to use for any possible takeover offers.

For Metro, I think I have commented on it previously at one of the comments page. But just to add, with the passing of Jopie Ong, things might become more interesting as some activist funds might think that it is time to act to unlock value in the company. Having said that, one should assign a certain margin of safety for the stock if you wish to buy it. Its outlook is not too great and it will not do as well as last year, simply because they are now in the process of re-investing their proceeds from previous divestment and some of their developments are still not progressing fast enough. For example, their S'pore property JV with Wing Tai, The Crest is not doing well. Therefore, dividends might not be as good as last year. However, there is a wild card that value might be unlocked if they can dish out excess cash but one must remember that they need cash to re-invest. At current price, unless there is real catalyst to unlock value, it is a hold for me.

2:50 AM  
Blogger ghchua said...

Hi Yoke Ming,

Thanks for your support of my blog. I do get requests to connect frequently but I hope that you can understand that it is very difficult for me to connect with so many readers on a personal basis and sometimes, the connection just broken down after a few emails. Therefore, I would prefer to discuss investment matters at the comments page here as fellow readers can also chip in and help.

Yes, I am a NTU Alumni and I do contribute yearly to NTU's iGAVE programme.

I do not know BullytheBear personally but I include his link at my blog as I have visited his and found it to be interesting and informative.

3:08 AM  
Blogger ghchua said...

Hi Soo Yean,

For your two questions:

1. NAV of a company can be found in various sources. Like SGX StockFacts, the Shares Investment book that is published bi-weekly, ShareInvestor website (need to subscribe to it to get fundamental information for stocks listed on SGX like NAV) etc.

2. I don't really advocate investors to go for dividend yield only when investing. Reason being you have to see where is the source of their dividends and whether it is sustainable in the long run. We have seen how some high yielding stocks previously like shipping trusts getting into trouble and they could cut their dividends to zero when times are bad. So, therefore, if you really want to go for dividend, a diversified approach is still the best. The average yield should be around 3%pa for S'pore stocks. Some do give higher dividends like REITs and some small/mid caps stocks. Therefore, it is still the individual stock that you need to look at rather than only from the dividend angle.

3:24 AM  
Blogger ghchua said...

Hi Keat Eu,

Thanks for your support. Indeed, long term investment makes sense if you adopt a process and follow through it. Though trading might sound exciting in the short term, it is the long term that we should be looking at. Unless you can consistently generate profits from trading, you might wish to consider the long term investment approach of buying a stock and holding for long term.

Hope that you could also join us in our long term investment journey.

3:34 AM  
Blogger Ho Yoke Ming said...

Hi GhChua,

I'm keen to invite you to join a social network for investors. I feel that your investment style and writing could really benefit those in the network. It's really like a FB for investors. All of which is free to join.

Joining this platform only requires a username, password and email. It's really that simple! You can also get to engage with other investors in real time and get more readership on your blog.

You can check it out here: www.investingnote.com.

There's really no gimmicks as it is a startup company founded in NUS.

7:33 PM  
Blogger ghchua said...

Hi Yoke Ming,

Will check it out. Thanks.

1:01 AM  
Blogger Sooyean Hoo said...

Hi Yoke Ming,
Thanks so much for the NAV tips. Investingnote.com is fantastic. With that I am able to have better analysis. BTW, there are also other goodies on the site, like Cash on Hands and so on. It is so cool. Thanks a lot.

E.g. A better analysis of portfolio mentioned above.
https://dl.dropboxusercontent.com/u/10304630/ghimHockStocks.png


Thanks so much.

7:57 PM  
Blogger Ho Yoke Ming said...

Hi Sooyean,

We're all retail investors....so must help each other out!

12:33 AM  
Blogger David said...

Hi ghchua,

I have been reading reports that the US stock market is going to crash, similar to what happen to 1987 Black Monday.
http://www.bloomberg.com/news/videos/b/a165acab-a2fe-463f-936a-b2a9ff01f3d8

what are your thoughts?

6:25 AM  
Blogger Sunny said...

Chua

Have you received any payment from the Pacific Health delist offer? Why is the company asking shareholders to subscribe rights since it is offering to delist? Feel confused...

10:33 AM  
Blogger ghchua said...

Hi David,

As long as your portfolio is well diversified, it should be ok. Of course, there will always be doomsayers who will "predict" that markets will crash. These people appear many times, saying how bad the world is. But as investors, we are taking risk when investing in the markets and we cannot avoid that. What we can do is to have proper risk management in place and ride out market volatility.

12:07 AM  
Blogger ghchua said...

Hi Sunny,

As you might have known, the exit offer for Pacific Healthcare fails as it is conditional on the offeror securing more than 50% of the shares at the close of the offer. Since they didn't manage to do that, the offer lapse and those shares had been returned back to you. But the delisting still takes place and therefore you are holding an unlisted company.

The company had also undertaken a rights issue and therefore you had been offered to subscribe those rights shares. However, do take note that the rights shares will be unlisted as well.

12:13 AM  
Blogger Sunny said...

Chua

Tks a lot for enlightening me. Till now I then know its exit offer failed. I dont feel like to put any more money into this one, how about you?

6:26 AM  
Blogger ghchua said...

Hi Sunny,

I will not be subscribing to the rights issue as well.

1:36 AM  
Blogger Ben said...

Hi all, I think that it will be prudent to put the investments into various baskets so as to spread the risk. I will invest my fund into two new counters every month. I will add more than two new counters when I have fresh fund from my bonus and dividend payout from existing counters. Such investment stratey will allow me to sleep soundly every night though the con of such strategy is highly monthly brokerage charges incurred on each counters (less investment due to counter spread out). I believe that the brokerage charge will be covered by the dividend payout from the counters. I do not sell the counters and will hold them for long term.

Ben

8:01 AM  
Blogger ghchua said...

Hi Ben,

Yes, I do agree with you that diversification is still the best method when investing in the stock market. Don't worry about brokerages as it is one-off and if you hold your stocks for long term, the effect is minimal on a whole portfolio basis.

7:58 PM  
Blogger Sunny said...

Dear Chua

Sabana reit has dropped a lot and looks stablised, does it warrent a buy and hold for div? tks

7:59 PM  
Blogger ghchua said...

For Sabana REIT, it looks attractive as it is trading below NTA and its yield is quite high. Also, its occupancy rate seems to be stable from its recent result announcement.

However, one must take note that its gearing is quite high at more than 40% and there might be a rights issue. Also, do take note of the headwinds in the industrial properties sector and the track record of the REIT manager. Its DPU had been dropping since listing and there is no visible pipeline of assets from their sponsor, Vibrant Group. Also, do take note of the negative rental reversions that they have experienced and going forward with the headwinds, I expect rentals to continue to come under pressure, thereby affecting their DPU going forward.

All in, I think the REIT might have hit bottom but recovery might not come soon and you also have to live lower DPU going forward.

8:13 PM  
Blogger Sunny said...

tks Chua very much, so glad and felt blessed to have your insight. It is very helpful.

11:34 AM  

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A self-directed investor, looking to invest for retirement needs and bypass all those expensive financial planners/insurance agents. Investing is fun, profitable or most important of all, knowledge gained is useful for the rest of your life!

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