Personal Opinion on Singapore Stock Market dtd 4 Aug 2014

Singapore mkt is based on the following primary driver:
1. Finance
2. Property
3. Offshore and Marine Services

Another sector of asset play is REITs. Published in the Business Times dtd 1 Aug 2014, the PE of ST Index stands at 14.3. This is considered fair value of the general mkt while the GDP(estimate) stand at 2-4%.

However the recent quarterly reporting, many companies shows a drop in Asset valuation. Also known as asset depreciation, there has been talks by the FED to increase interest rate but only to tapered off recently as the latest FED meeting shows that they will hold at ZERO interest rate.

To draw to a conclusion of the general mkt, we must be vigilant for any interest rate rise and also to practice prudent approach to our investing methodology such that the "Margin of Safety" must be increase from 20% to say 25 -40% from its book value. This is to take into consideration of market volatility and poor revenue from the coming months



DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Technical Analysis on CourtsAsia dtd 22 Jul 2014

Entry pt @ 0.56
Target @ 0.64
Trade Type: Swing - Long

UPDATES

5 Aug 2014 - Unfortunately, CourtsAsia closes below its book value of 0.54. This close however do not represent a panic selling as the volume is too little. Overall, with the opening of mega mall in Indonesia, i'll expect more revenue with better margins to come from there.





DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Are you a Trader / Investor or In between the Lines?

After going through several forums, I have seen a lot of new investee/tradees* getting caught in blurring what they want to do with the equities they have bought. Many investee / tradees start plunging into the equities and getting their feet wet. However, most people will be caught with their pants down and it resulted in holding their equities as long term instead of what they had hoped for a quick buck.

These investee/tradees are those that bought on the highs and usually sell at the lows. They usually followed the herd and lose out when the tide recedes. In the stock market, there are many type of people with regards to the equities they have bought. Generally, i would like to classify into these few groups. Namely:

• Scalpers
• Day trader
• Swing trader
• Investor

Scalpers : - Works on profiting from 1 bid to 2 bid differences. Their risk is super high as they sought to profit with big quantity in buying up the shares. Their holding period could range from secs to mins

Skills required: technical analysis, market volatility, lots of backup money, trading plans

Day traders: - Their aim is to profit from the swings that is created during the trading period. It could be long/short and the market must be volatile for them to employ this type of strategy. Usually, they choose stocks that has high betas and they will usually closed their position before end of day. Their risk is high but lower than those who are scalping.

Skills required: technical analysis, market volatility, enough money to pay any losses, trading plans, time

Swing traders: - My style of trading which i believes more suitable for those who are busy with jobs & duties. Swing trades takes time usually range from 1 week to 3 months exposure. Their risk are much lower as they have holding power.

Skills required: technical analysis, fundamental analysis, patience, trading plans

Investors:- Last but not least the long term investors. As some people in the forums complaint that they have become long term investors due to stocks price that has fallen way beyond their buy-in price. A true blue investor looks at equities as a piece of business that they would want to hold for the long term. Usually, these are the savvy businessman, that would take opportunities to load up more if the offered price is at bargain and sell only when the market overpriced its stocks or the business outlooks becomes poorer due to competition or other issues.

Skills required: technical analysis (minor). fundamental analysis, patience, ability to interpret financial reports, business savvy.

Hopefully with this article, Investees / tradees would be able to take the plunge in the equities without being killed in action and to take that baby steps towards financial freedom.

* - My own definition of new investors / traders

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Mapletree Greater China Commercial Trust with a Stable Handle

MGCC listed on SGX Mainboard on 7 Mar 2013

http://www.mapletreegreaterchinacommercialtrust.com/Investor-Relations/Publications/Annual-Reports.aspx

Financial Data

NAV: $1.05
Mkt Value (18 Jul 2014) : 89c
Div Yields: 7%
Div Payment Period:    May, Nov

Opinion

Having received its annual report, i'm glad that i have invested in this REIT around the price of 86-90c. This REIT reported a 7.4% increase in actual gross revenue as compared to an estimated forecast. Its actual DPU is higher by 13.1% as compared to its forecast. With its current price at 89c (Dtd: 18 Jul 2014) and its NAV @ 105c, this counter is currently undervalued. However, one of the risk that need to be highlighted is its Gearing Ratio. Its current ratio is 38% (Refer to annual 13/14, pg 5) which is relatively higher as compared to other REITs. Going forward, I don't expect to see much changes.

One of the future developments in MGCC, is for the sponsor to inject new buildings into this portfolio. Given the sponsor has won a government land tender in HK that is earmarked as HK new CBD, the site will be developed into Grade-A office building.




DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Learning from Peter Lynch

After reading the book "One up on Wall Street, Peter Lynch", I've picked up an important point which I've missed out in categorizing the stocks that we buy. By applying Peter Lynch strategy, I believe most investor can look into their portfolio and reorganize their stocks into what they buy and have a better  they should buy next to enhance their portfolio.

Peter Lynch classified stocks into 6 general categories:

1) Slow Growers: - Usually large and aging companies that are expected to grow slightly faster than Gross     Domestic Products (GDP) e.g utilities, telcos

2) Stalwarts : - Multi-million dollar hulk, faster than slow growers, usually 10-12% annual growth e.g Coca- cola, P&G

3) Fast Growers:

• Small aggressive new enterprises that grows at 20-25% per annum
• Plenty of RISK
• Look for good balance sheet and are making substantial profit
• The trick to SELL is to figure out when they'll stop growing and how much to pay for the growth.

4) Cyclicals :

• Usually expands and contracts, then expands and contracts again
• Timing is everything in cyclicals e.g commodities               

5) Turnarounds:

• Candidates that have been battered, depressed and often can barely drag themselves into   bankruptcy.
• Have to be patient, keep-up with the news and read it with dispassion.
• Stay away from companies with tragedies where the outcome is unmeasurable.         

6) Assets Plays:

• Company that is sitting on something valuable, e.g pile of free cash, real estate
• Requires patience to unlock value.              

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

CNMC Goldmine, worth the RISK?

CNMC Goldmine listed on SGX as a Catalist on 28/10/2011

FY             Gold produce (oz)  Ave Gold Px (USD)     Accumulated Losses (SGD)
2010              553                          1224.5                       -4,577,383    
2011             3097                         1571.5                       -9,737,450
2012             4641.86                    1668.98                     -8,993,664
2013             12649.06                  1411.20                     -6,639,065
2014 (TTM) 4010                         1293.10                    

Financial Data
(All units in USD)
FY            EPS               Revenue              Net Income
2010         -0.46c            0.53 mil                 -1.93 mil
2011         -1.34c            5.142 mil               -5.137 mil
2012         0.18               16.761 mil              1.010 mil
2013         0.66               16.625 mil              3.433 mil

Debt

• Current : 1.129 mil
• L.T       : 0.011 mil

Cash-on-Hand : 4.38 mil

NAV: 3c

Outstanding shares: 407,693,000

Dividend Payout Month: Jan, Jun

Opinion

In my own opinion, CNMC is great to hold at the current price of $0.265. Within its few years , it managed to increase its revenue, lower its accumulated losses and increase its eps. According to its latest quarter filings, it managed to produce 4000 oz, and with gold price at a steady USD 1300 /oz, it should be able to reduce its losses. The managment has also made a commitment to reduce its all-in-cost for gold to a target of USD 700 / oz. Given that CNMC is actively looking to increase its mining activities in gold and also the latest tied up in tin mining in Perak, I'm looking forward to seeing higher revenue from CNMC for the next few quarters. 

Alternative views:

http://www.nextinsight.net/index.php/story-archive-mainmenu-60/924-2014/8220-cnmc-in-2014-higher-economies-of-scale-higher-gold-production

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Tat Hong, buying below its NAV

Tat Hong listed at SGX on 1 June 2000

FY                   EPS           Rev (mil)         Net Inc (mil)      Net % Margin
2014 (TTM)    4.46c
2013               11.62c         836.9              70.4                  8.4%
2012                7.42c          719.8              42.3                  5.8%
2011                4.56c          548.2              26                     4.7%
2010                7.20c          495.4              38.6                  7.7%
2009              13.62c        631.8              68.9                  10.9%

Ave         8.88c                                                          7.5%

Debt

• Current: 202.951 mil
• L.T : 277.869 mil

Cash-on-hand: 70.871 mil

Total Debt: 480.82 mil

NAV: $ 1.04

Shares: 629,823,823

Convertible preference shares: 11,700,000

Data as correct based on 21 Mar 2014 Business Times

Div yield (gross) : 3.4%
Div paying period => Aug , Nov

P/E -> 6.4

Opinion

At its current price, Tat Hong looks attractive. Given the slow down in construction and commodities industries due to it cyclical nature, Tat Hong has taken a revenue cut back.  But this has given rise to an opportunity to get this stock at a cheap price. Looking at its NAV, Tat Hong is now trading at 27% below its NAV.

Will it go lower? Probably yes. In yr 2011, its lowest trading price is 69c. My view on this stock is to accumulate for the long term.


DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Analysis on Tat Seng Packaging Ltd

Tat Seng Listed on SG Mainboard on 07 Sept 2001

Financial Data

Yr                  Earning/Share                  Revenue              Net Profit % Margin
2013                  7.53c                          215.601 mil              7.7%
2012                  4.92c                          179.857 mil              2.9%
2011                  2.83c                          166.811 mil              2.56%
2010                  3.96c                          153.284 mil              4.24%
2009                  4.74c                          113.361 mil              6.95%


Other Data (as at 31 Dec 2013)

Cash Bal: 23.125 mil
Debt:

• Current: 37.458 mil
• L.T      : 5.994 mil

Shares Issued : 157,200,000
Treasury Shares : NIL
NAV: $0.5101
Gross Div Yield: 4.8%


Opinion

Being in a competitive industry, Tat Seng has managed to hold its ground against its competitor. With increasing gross revenue and net income, this counter will be good for long term holding, provided it can control its cost.

A need to take note is its current debt. Hopefully, this company do not need to raise additional capital to cover the debt.

Conclusion

Overall, the price of the stock is badly undervalued @ 26c. This company is good to accumulate for the long term.

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Strategy for 2014 Post Budget Announcement

What a day for our finance minister to announce the budget for 2014. There are a few point which has caught my eyes to formulate my strategy for the year. Below are the few points:

• Increase in Sin tax. http://sg.finance.yahoo.com/news/singapore-tax-sin-instead-wealthy-112408619.html
• No standoff from property cooling measures http://sg.finance.yahoo.com/news/singapore-says-too-early-relax-102434934.html
• Support for the construction industry http://sg.finance.yahoo.com/news/budget-govt-further-support-developers-085543209--sector.html
• Support for SME to upgrade http://business.asiaone.com/news/budget-2014-s500m-scheme-boost-smes-ict-adoption-rate, http://business.asiaone.com/news/budget-2014-pic-scheme-extended-until-ya2018, http://business.asiaone.com/news/budget-2014-more-support-singapore-companies-raise-funds

With the above support from the govt, we can look into a few areas for growth story and avoidance sector.

• Avoid property sector and Company that produce alcohol
• Look for companies that is less than 1.3bil in mkt cap as they are defined as Mid cap and small cap
• Blue Chips companies will not be in focus as their total operating cost will be increased due to increase in 1% CPF contribution. Thus avoid.
• Buying REITs only if it is undervalued and has more than 5.5% in dividend. This requires researching REITs 

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Portfolio: When to cut your losses?

I think this topic is the most difficult for ordinary investor whom are holding to losing position and thinking that the stock will come back to your original buying price, and then you will cut your stock to break even. I have learnt this issue the hard way. Holding to losing position for years! You're right that you need years to break even while other stocks are zooming away. Shown below is a table that estimate the percentage you need to recoup:

Drawndown                     Gain to recovery
5%                                        5.3%
10%                                     11.1%
15%                                      17.6%
20%                                      25%
25%                                      33%
30%                                     42.9%
40%                                      66.7%
50%                                     100%
60%                                      150%
75%                                       300%
90%                                      900%

Source: http://www.youtube.com/watch?v=2srWG3L5z9I

Thus with the table shown above, we can use 5-15% drawndown as a base guide to stop our stock form bleeding.

As an active investor, a weekly monitor of stocks performance is required. This will let us have a peace of mind in managing our stocks.



DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Fundamental Analysis on Amara Holdings

Amara Holding listed on 10 July 2000 on Mainboard,
                                      15 Aug 1997 on Sesdaq

Financial Data

FY          EPS          REV      Net Income    Free Cash        Net % Operating
             (cents)       (mil)           (mil)               (mil)                      Margin          
2012      5.10         90.3         29.426             15.226                32.60                  
2011      5.84         62.1         33.673             11.443                54.23                  
2010      2.83         61.688     16.353             10.346                26.51                  
2009      1.95         102.679   11.255             22.373                10.96                  
2008      2.08         71.429     11.985             27.026                16.78                  

Ave        3.56         77.64                                                          28.216
(5yr)  

Other Data

Cash Bal : 11.486 mil
Debt (current): 12.704 mil
         (LT)     : 201.919 mil

Shares issued: 579936000

NAV: 50.24c

Div Yields : 1.1%
Div Payout Mth: June

Div Payout (2013 / 2012 / 2011 / 2010 / 2009) : 0.6 / 0.6 / 0.5 / 0.5 / 0.5
(cents)

Opinion

I chance upon this stock while doing my daily scanning for trading. Amara Holding is from the hospitality sector and have been listed on the Singapore Exchanges for more than 10 yrs. Thus i have carry out research on the fundamentals of this company. Looking at its 5 yrs data the company revenue whipsawed as there is no consistency in earnings. Operating margins remains healthy. However, its debt outstanding is a case for concern and most probably will be looking for financing for the next 12 - 24 mths.

Conclusion

With its book value at 50.24c (TTM), its estimated FY 2013 will probably be around 2.2 - 2.6 cents. Given that it is trading at 56c, this counter is now trading at 10% premium. The PE is at 11 which look fairly valued.

Should you have this stock, it would be wise just to HOLD.

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.