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Thursday, August 31, 2017

My Investment Portfolio (August 2017)

STI closed the month at around 3277 points, ending the month down from last month. Trading volume had generally been low and markets had been concerned about tensions on the Korean peninsular. Corporate results had been ok, but I guess markets might have already factored in some of these results.

For this month, I have attended the following AGMs/EGMs/briefings - Delfi, Haw Par, UOL, Del Monte, Cosco and DMX.

For my top 30 holdings, ComfortDelgro returned to the list again as I added more onto the stock on recent share price weakness. Venture also appeared in the list for the first time after it outperformed lately due to decent half year results and exposure to automotive sector. Best World, however, dropped out of the list after their recent selldown due to concerns on their China market business model.

I have bought the following companies from the market this month - Bund Center, ComfortDelgro, EnGro, Hotel Grand Central, Hotung, Hotel Properties, IP Softcom, Keppel T&T, PNE Industries, Raffles Medical, Singapura Finance, Stamford Land and Straits Trading. I have also closed my position in United Food.

I have also participated in the following scrip dividend schemes this month - Frasers Commercial Trust, Keppel REIT, Far East Hospitality Trust, CapitaLand Retail China Trust, DBS and UOB.
 
Next month will be another quiet month. Therefore, I will spend sometime looking closely at my portfolio and prune down some stocks. It had been my intention to reduce the number of stocks in my portfolio for quite sometime and I have already identified some stocks which I wish to eliminate. I will also, as usual, catch up with some readings.

My S'pore Stock Portfolio - Top Holdings, cash investment only (correct as at 31 August 2017)

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

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

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

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
22. Eratat Lifestyle - In Liquidation
23. Fung Choi Media - In Liquidation

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

24 comments:

  1. Jaclyn7:59 PM

    Chua, My understanding is you have few hundreds of stocks in your portfolio. But for the first time I noticed you have stated you want to prune your holdings. So is there any number to which you are ultimately aiming for 30, 50 or 100.... pls share your thoughts. Famous investors have suggested not to go beyond 15 stocks and personally for me, I feel it should be less than 30... so wanted to hear your thoughts on where you stand. Thank you.

    ReplyDelete
  2. ghchua9:57 PM

    Hi Jaclyn,

    There is no ultimate number that I am aiming for, but the task is to reduce the number of holdings in my portfolio. The number is not a problem for me, but rather the allocation for some of those smaller holdings are no longer meaningful as I don't think I will be adding onto those positions and even if they return more than 300%, it is too insignificant to have any impact to my portfolio.

    Also, with iFAST now offer cheaper brokerage, I thought it is also a good opportunity for me to reduce those small positions which incur minimum brokerage charges. Previously, it is quite expensive to do so with other brokers even if you do online trading.

    ReplyDelete
    Replies
    1. Jaclyn9:57 AM

      Chua,

      Thank you for your clarification and it makes sense on how you are approaching to a situation to which you are comfortable with.

      But does the IFAST is a really cheaper option? I felt any purchases would turn out expensive in the longer run while appearing cheaper on the short run. Not sure about its effect on sell trade alone. After an initial look I felt it is worth to wait before switching from traditional brokers who continue to be expensive for small sum investors. I felt SG market is unfriendly to small investors. Do share your thoughts. Thank you once again.

      Delete
  3. Wei6:13 AM

    May I know whether one needs to transfer share holdings in CDP to iFAST custodian before he/ she can sell the shares? If so, are there any charges involved? Thank you.

    ReplyDelete
  4. Anonymous6:31 PM

    Hi ghchua,

    What do you look out for when you read annual reports?

    ReplyDelete
  5. ghchua6:52 PM

    Hi Wei,

    The answer to your question is no. iFAST offers two sell options, one through their custodian and another direct sale from CDP. There is no need to do a transfer to their custodian to sell if you do not wish to do so. The brokerage for selling through their custodian and direct from your CDP is the same. You just need to do a one time linkage of your CDP account to iFAST and once it is done, you can start to sell your stocks held in your CDP account through their platform.

    However, do take note that for purchase of stocks, you have to use their custodian and not CDP.

    ReplyDelete
  6. ghchua7:01 PM

    Hi Jaclyn,

    Need to clarify a bit here. I am using iFAST platform for sale of stocks, not for purchase. For purchase, iFAST does not use CDP settlement so I shall stick with my normal brokers for now.

    As I have said above, I don't think I will be switching completely to iFAST but they do offer competitive brokerages. Having said that, there are some limitations to their platform and therefore not suitable for everyone.

    Getting rid of those small positions had been in my plan all along, but execution had been a problem. As you might have noted, some of these small cap stocks have low liquidity, large spread etc. Things had gotten even worse after share consolidation due to the SGX 20cts minimum trading price. It had not been easy, so I will not be selling at any price but the aim is to prune down as much as possible but at a reasonable price point. So, it is not panic selling all over the place.

    Yes, it continue to be expensive to buy/sell small amount of penny stocks. I guess we have to live with it at this moment. If only we have $1 (or even less) brokerage like in the US.

    ReplyDelete
  7. ghchua7:09 PM

    Hi Michael Tao,

    Quite a lot of things to look out for in an annual report and I don't think I can cover everything here in one post. I think if you are really interested, you should at least need to have some basic understanding of financial,cost and management accounting to read the accounts and statements. Sorry, I really can't say which part to take note because sometimes, the most important information in the annual report are "hidden" in the notes of the accounts and you need to dig it out.

    However, a new reporting standard now requires the auditor to highlight key audit matters in their report to shareholders. You can start by looking at that section for some important matters that you might wish to take note in the accounts.

    ReplyDelete
  8. Wei8:51 PM

    Hi ghchua,

    Thanks for the info. I am glad that we can sell shares direct from CDP through IFAST platform and the brokerage fee is the same. For purchases of shares, seems like DBS cash upfront is the cheapest at the moment, at minimum $10 per counter (after rebate will be minimum $5). Moreover, purchase using DBS cash upfront will be held in CDP under our name which will be safer than through a custodian.

    ReplyDelete
  9. PG1:10 AM

    Hi GH Chua, I am your support since 2008. Would like to know, I observe that you had added gradually for Yeo Hiap Seng almost every month although the share price is pretty flat. What is your game on this counter?

    PG

    ReplyDelete
  10. ghchua4:34 AM

    Hi PG,

    Thanks for your support! Really appreciate it.

    For Yeo Hiap Seng, I have explained my thesis for investing in this counter in the comments section for My Investment Portfolio (May 2017) blog post. You can refer back to the link below:
    https://www.blogger.com/comment.g?blogID=8621977&postID=6935188303935193669

    "Hi retnuoc,

    Yes, YHS's 1Q result is disappointing, but my thesis when investing in YHS is not their F&B business but their land bank. If you happen to take a look at their annual report, you will notice that they have significant land bank and properties across Malaysia, Hong Kong, China and USA.

    Besides divesting Super Group, they also recently divested some property in Hong Kong, netting $64m in sales proceeds. I don't know whether they will give a special dividend this year but based on the two mentioned divestments, it amounts to around $200m in cash proceeds which is quite significant. Unless they need big capex for their operations, I think they might distribute some back to shareholders.

    Hopefully, they can continue to dispose idle assets and realized value for shareholders."

    ReplyDelete
  11. ban`5:01 AM

    Thanks for your insights GH Chua. You are indeed inspiring.

    I had got to know good stocks like Forterra Trust and GP Batt from your posts.

    Appreciate your open style sharing!

    PG

    ReplyDelete
  12. ghchua8:43 PM

    Hi Sunny,

    For BRC Asia, I think the company had not been doing well for the last few years due to construction industry downturn. Though the offer price looks attractive, the outlook seems to be better now for the company. I have not made a decision whether to accept the offer or not at this moment, and will wait and see.

    For Man Oriental, we do not know whether the sale will go through or not (and at what price too), so any comments on dividends will be premature for now.

    ReplyDelete
  13. Unknown6:51 PM

    Hi Mr Chua,

    With the recent huge sell-off of Comfort stock due to intense competition and negative news, do you think the current price at 1.9X still looks attractive and worth accumulating?

    Thanks.

    Regards,
    Hugo

    ReplyDelete
  14. ghchua1:34 AM

    Hi Yong Xiang,

    For me personally, I will not be buying ComfortDelgro aggressively but slowly at different price points. Normally, I like to buy different stocks at any one time so as to spread my risk so I will not be only buying ComfortDelgro. Therefore, it is difficult to tell you exactly which price point to buy, but rather to diversify and do your own risk management. I can only tell you that a stock is attractive at current levels, but no guarantee that it will not move down further due to short term market movements.

    ReplyDelete
  15. Unknown2:40 AM

    Thanks for the reply. Given that you are still accumulating, though slowly, you are suggesting that the stock is attractive at its current valuation?

    ReplyDelete
  16. ghchua4:34 AM

    Hi Yong Xiang,

    The short answer is yes. But there are a lot of shorting pressure in the short term on ComfortDelgro so therefore I dunno how low it can go. As I said before, my strategy is not to buy everything in one go but rather spread my purchases at different price points.

    Hope that the above clarifies.

    ReplyDelete
  17. D4:04 AM

    Hi Mr Chua,

    Are you still holding Raffles Education?

    Do you know why Oei HL kept buying back recently? The price has shot up at least 30% over one week? What is your thoughts on this?

    Thanks in advance for your thoughts.

    WY

    ReplyDelete
  18. ghchua6:00 AM

    Hi W Y,

    Yes. Raffles Education is still in my portfolio. I do not know what is the intention of Mr Oei with respect to Raffles Education but he had been a shareholder for quite sometime. It is only recently that he had decided to up his stake in the company.

    Based on NTA basis, the stock do look undervalued but do take note that their business had not been doing well for the past few years.

    ReplyDelete
  19. Sunny3:14 AM

    Shifu Chua

    Received BRC offer letter? Decision made to let go or keep?

    For Man Oriental, market has been upset for company's decision not sell the HK Hotel. Shall we wait for next better offer? STI is quite weak now, worrying about war only or real future econ index worsening?

    tks

    ReplyDelete
  20. ghchua7:25 PM

    Hi Sunny,

    For BRC Asia, I think the company had not been doing well for the last few years due to construction industry downturn. Though the offer price looks attractive, the outlook seems to be better now for the company. I have not made a decision whether to accept the offer or not at this moment, and will wait and see.

    For Man Oriental, I still believe that it is undervalued even if the sale of the HK Hotel didn't go through. Therefore, I will holding onto my position.

    Yes, it looks like STI is now in a correction mode. However, I will remain vested in the stock market and continue to look for undervalued stocks to invest in. War might increase volatility of the markets but as long as your portfolio is diversified with good risk management in place, I guess we will be ok in the long run.

    ReplyDelete
  21. D6:22 PM

    Hi Mr Chua,

    I was at the Raffles Education AGM yesterday. Are you there?

    I refer to Oei's latest move, I just find the CEO/chairman words cannot be trusted. However on the other hand, a new chairmen/CEO may affect the business since Mr Chew is well connected. What is your comment?

    Because of the saga, the price has driven up. However, for business, I do not think such saga helps the business at all. As a matter of fact, I am pondering to sell...

    Regards
    WY

    ReplyDelete
  22. ghchua8:22 PM

    Hi WY,

    Nope. I didn't attend the AGM.

    I think Mr Oei might be eyeing the assets in Raffles Education, and not necessary the business. The business, as I have said before, is not doing well. Whether Mr Chew is still running the business might be irrelevant to Mr Oei if his intention is to strip the assets in Raffles Education.

    I do not know Mr Oei's actual intention so I am just guessing here. As I have stated earlier, Raffles Education is trading below NTA so it is cheap on that basis alone. I am not adding any value of the business but just based on NTA alone. Therefore, I am not in a hurry to do anything at this moment and just wait.

    ReplyDelete
  23. D4:31 AM

    Hi Mr Chua,

    Thanks for taking time to share your thoughts.

    Yup you are right, Raffles Education is trading below NTA. I should be rational and objective rather than form bias just because I dislike saga.

    Have a great weekend.

    Cheers,
    WY

    ReplyDelete