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Saturday, May 31, 2014

My Investment Portfolio (May 2014)

STI ended the month up at 3296 points. Markets had been quite steady this month. Companies with financial year ending March 2014 had been reporting their full-year results, and most had met market expectations. Basically, markets lack more bad news to pull it down, therefore it had remained steady.

For this month, I have attended the following AGMs/EGMs/briefings -Petra Foods, HanKore, Jacks International, Frasers Centrepoint Trust and Low Keng Huat.

For my top 30 holdings, the main contributors this month include Old Chang Kee, Metro, Hong Fok and MTQ. With the exception of Hong Fok (which has a different financial year end than the other 3 companies), the other 3 companies with financial year ending March 2014 reported their full-year results in May 2014 and their results are within my expectation.

I have bought the following companies from the market this month - Amara, Auric Pacific, BBR, Bukit Sembawang, DMX Technologies, Forterra Trust, Grand Banks, Heeton, Hong Leong Finance, Intraco, Jardine Strategic, Lantrovision, Lum Chang, Saizen REIT, Sinarmas Land, Straits Trading, United Overseas Australia, UOI, World Precision and Zagro Asia. There is no sale done this month.

I have participated in the following scrip dividend schemes this month - First REIT, Jardine Matheson and Jardine Strategic. I have also participated in the following rights issue - Hai Leck.

Next month will be another quiet month for me. I will seek to re-invest the remaining dividends paid out near the end of May 2014 which I didn't have the opportunity to do so. There will be some cash drag in my portfolio due to that which I will seek to resolve it next month. I will also do some catch-up reading on some periodicals and investment books.

My S'pore Stock Portfolio - Top Holdings, cash investment only (correct as at 30 May 2014)

Top 30 Holdings (Sing$ Denominated shares)
1. Sarine Technologies
2. United Engineers
3. Old Chang Kee 
4. Jardine C&C
5. Bukit Sembawang Estates 
6. Metro Holdings
7. Haw Par
8. Hong Fok
9. OSIM International
10. Aspial 
11. Bonvests
12. MTQ Corp  
13. Noble Group
14. Hotel Properties
15. A-REIT
16. SGX
17. Sing Investment & Finance
18. Far East Orchard 
19. Hotel Grand Central
20. Hotel Royal 
21. Hiap Hoe
22. CapitaMall Trust
23. Hong Leong Finance
24. VICOM
25. The Hour Glass
26. Keppel Land 
27. SembCorp Marine
28. Singapura Finance
29. Low Keng Huat
30. SP AusNet

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

Top Holdings (HK$ Denominated shares)
1. Fortune REIT
2. 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. 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. Japan Land - In liquidation - Members' voluntary winding up
11. Zhonghui - In liquidation - Compulsory winding up (Insolvency)
12. FerroChina - Under Liquidation
13. FirstLink Investments
14. NEL Group
15. KXD Digital Entertainment - In liquidation - Compulsory winding up (Insolvency)
16. Shanghai Asia Holdings - In liquidation - Members' voluntary winding up
17. Jets Technics
18. UIS - In liquidation - Members' voluntary winding up
19. Guangzhao Industrial Forest - In liquidation - Compulsory winding up (Insolvency)
20. Hongwei Technologies Limited (In Provisional Liquidation)
21. FDS Networks Group
22. Aussino Group
23. Sunray Holdings

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

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34 Comments:

Blogger Everlearning said...

In the month of May, there were too many things to attend to especially the matters of the home. The worst was the fibre optic broadband at home broke down twice.

Despite the inconveniences and irritation that happened, I was looking forward to collect May's dividends: I had the most dividends that came from K1 Ventures besides other counters.

In the months of September and November, the dividends are pretty good too. It seems to be quite preditable for me in the past 6 years. How about you?

11:19 PM  
Blogger ghchua said...

Hi Everlearning,

As always, it is nice to hear from you again.

I think for a full-time investor like me, managing cash flow to match with expenses every month is very critical. Although dividend payout every month might differ, some of our expenses are fixed every month. Which means, for those months that you have higher dividend payout, you should not re-invest everything but reserve some for lower dividend payout months for your expenses.

We should not take things for granted in investing although dividends are quite predictable for REITs and some of the big cap stocks with long dividend payout history.

2:22 AM  
Blogger Max said...

Hi I am also holding K1 ventures. How long do you plan to hold this stock? Thanks

3:41 AM  
Blogger edragon said...

Hi GH,

What do you see in Forterra Trust to deserve a buy?

Thanks,
Ed.

2:52 AM  
Blogger ghchua said...

Hi Max,

My investment horizon is always very long term. Therefore, I will not be looking to sell K1 Ventures anytime soon. K1 Ventures do have some businesses which are doing well and they still have yet to divest them. Although they are not making any new investments, their existing business is good enough for them to increase shareholders' value.

10:16 PM  
Blogger ghchua said...

Hi edragon,

I guess for Forterra Trust, I am buying mainly because of its big discount from NAV. Some of their assets are not income-generating yet, and therefore one have to be patient to see how it goes.

In the meantime, I don't think they will be able to pay me any dividends. But I am in for a long haul and therefore I am willing to wait out.

10:18 PM  
Blogger Max said...

Hi, thanks a lot for this excellent advise! Appreciate it.

10:39 PM  
Blogger edragon said...

Thanks GH, for the reply.

1:16 AM  
Blogger Sanye ◎ 三页 said...

Hi Sifu GH,

Do you still hold Transpac (TIH) shares? Will you be converting the bonus warrants?

1:26 AM  
Blogger ghchua said...

Hi Sanye,

Yes. I am still holding onto my TIH shares. My initial intention is to sell some of the bonus warrants while converting some of them to shares. I understand that for the first exercise price, one will have to exercise your TIH warrants within the first 6 months of issue of the warrants.

I have yet to decide how much of the bonus warrants I wish to convert and how much to sell in the market.

8:53 PM  
Blogger Mansred Koh said...

Hi ghchua, just asking what are your reasons for buying saizen reits?

11:16 AM  
Blogger ghchua said...

Hi Mansred,

I bought because I expect the result of their strategic review to be positive, which might return some cash to unitholders.

Unfortunately, it didn't turn out well but I still like it because of its undervalued properties. They managed to sell some of their properties above the book value recently and therefore I still believe that there is value in the stock.

7:19 PM  
Blogger faith said...

Hi GH Chua,

May I ask if you hold Super Group shares? In your opinion, do you think this stock is worth holding please? Thanks!

Faith

10:31 PM  
Blogger ghchua said...

Hi faith,

I only have a small position in Super Group. I didn't bought more of the stock after taking an initial stake many years ago.

Basically, I do like their business as they have managed to increase their sales throughout the years, and their twin engine of Branded Consumer (BC) and Food Ingredients (FI) business looks good to me.

Recently, they have suffered some setbacks in the BC segment due to lower sales in Southeast Asia, mainly due to Thai civil unrest. I still like the stock but valuation at current level might be uncomfortable for me. Therefore, I will not buy more but I will not sell too at current levels.

11:50 PM  
Blogger faith said...

Hi GH Chua,

Thanks for sharing. My humble opinion is its a good stock to keep too. How about HPH? I kept the stock for its dividend. But I have not seen you investing in it. Could I have your thoughts on this stock please? Thank you.

Faith

10:20 PM  
Blogger ghchua said...

Hi faith,

I don't own HPH and therefore I am not familar with the stock. But normally for ports, you have to look at their competitive advantage and see whether there are any competition with new ports coming up. Also, you have to look at how long is their rights to operate the ports and what happen when their rights expires.

Anyway, there is a good discussion on this stock at Valuebuddies. You may wish to refer to the link below for further details:
http://www.valuebuddies.com/thread-622-post-86756.html#pid86756

7:44 PM  
Blogger 李东 said...

Hi, can you share about the software, program or website you use to help monitor and track your large portfolio?

3:37 AM  
Blogger JP said...

Hi GH.

I m a first timer into yr blog. I have a couple of long held stock am would like to seek yr views on Hong fok and stamford land. TQ

9:54 PM  
Blogger ghchua said...

Hi 李东,

I don't really use any complicated software to monitor and track my portfolio. I use CDP online to collect my stock holdings and then use Microsoft Excel and OpenOffice spreadsheet to sort and organize them.

Nothing complicated.

10:40 PM  
Blogger ghchua said...

Hi JP,

Welcome to my blog!

I like Hong Fok because they own a portfolio of undervalued assets. The redevelopment of Concourse is a good example of the value that has been unlocked in the property.

Next big thing on the plate is the development of the car park block into a 30 storey 609-room hotel next to International Building.

For Stamford Land, it is also an asset play as they own a portfolio of hotels in Australia. Some of them have good redevelopment value, while some could be sold to unlock value. This stock is also for patient investors who don't mind waiting as they slowly unlock value for shareholders.

10:48 PM  
Blogger foolcj said...

Hi GH Chua, I noticed that you bought DMX from the market in May. Why did you buy into this company? Considering the bad AR, Cashflow and forever dropping shareprice and low float.

I like the NAV to price and PB, and seriously would like to hear from you the reason behind owning this share.

TIA.

9:30 AM  
Blogger ghchua said...

Hi foolcj,

I think share price dropping is based on the market and I do not have a view on that. I rather focus on the fundamentals of the company.

If you take a look at DMX's 2Q results announced on 7 Aug, they have turned operating cash flow positive in 2Q, due to better management of inventories.

For the high AR, it had been a problem due to their exposure to the telecom sector in China. They have explained the reason for that and allow me to re-produce it below:
"The Group recognizes revenue to telecom operators upon delivery of equipment and such projects
typically require 6 to 18 months before they are fully implemented and accepted. On the other
hand, collections are made based on project milestones such as equipment delivery, project
installation, completion and acceptances. As a result, trade receivables relating to projects which
have been invoiced but have yet to be implemented, completed or accepted, amounted to
US$330.1 million or 93.8% of the trade receivables, as compared to US$311.0 million or 94.1% as
at 31 December 2013."

Of course for those AR, anything could happen like project delays, disputes, warranties etc but I believe that the market might have already priced in some of these risks.

I guess with the group shifting its focus on lower capital intensive biz for ICT segment, revenue will decrease which might reduce the AR going forward.

The company itself is actually not so bad. It had been profitable for the past few years and had been paying dividends as well. They have been trying to grow their recurring revenue rather than depending on project based ICT business. Let's see whether they can execute it well going forward.

7:21 PM  
Blogger foolcj said...

brilliant reply! do you have a butt feel price target for DMX as i doubt the market will priced a hefty NAV buyout anytime soon like what they did with datacraft a shortwhile again.

the concern with these technology companies are that the depressed price make them do a delisting below IPO price considering the new SGX ruling on <20c counters next year.

do you foresee any of this sort of regulatory risk?

8:56 AM  
Blogger ghchua said...

Hi foolcj,

I don't think DMX is as big as Datacraft to factor in a hefty NAV buyout. Maybe a similar example would be the buyout of Frontline Technologies by BT a few years ago.

For any delisting to happen, they have to appoint a IFA which will present its report to see whether the offer is fair and reasonable.

With the implementation of the 20cts rule, companies which refused to comply might be put in the SGX watchlist. And for companies in the watchlist, I agree that there is a risk that companies might be delisted mandatory by SGX without an exit offer. However, I don't see any reason why companies do not wish to comply with the new rule. By just doing a share consolidation, they should be able to maintain their listing status without any improvement in the profit numbers.

8:12 PM  
Blogger Chin Ang said...

Hi GH
Will you be converting your hai leck right to mother shares? As div of 3c is to be given soon..
Please advise.

10:16 PM  
Blogger ghchua said...

Hi Chin Ang,

Oh yes. Will be converting my Hai Leck W19 warrants to shares this time round. I have converted those W18 warrants during the last dividend payout, so no longer hold any Hai Leck W18 warrants.

5:54 AM  
Blogger Chin Ang said...

Hi GH
May i Know what is the procedure to convert the warrants
How long will it take?
Please advise.

6:19 AM  
Blogger ghchua said...

Hi Chin Ang,

You have to ask the warrant agent to send you the warrant exercise form or you can collect it personally from their office. Information on the warrant agent i.e. their contract number and address is available at SGX website.
http://www.sgx.com/wps/portal/sgxweb/home/company_disclosure/all_in_one/warrants

After that, you just need to fill up the form and attach a cashier's order which is the exact amount that you need to pay to exercise the warrants.

Normally, it will take around 1 or 2 weeks for the warrants to be converted but they will normally do it faster when there is a corporate action like dividend or the warrant is near expiry.

7:47 PM  
Blogger Chin Ang said...

Hi ghchua
Are you still holding Hai leck counter?
Profit warning is issued..I am still holding..

4:44 AM  
Blogger ghchua said...

Hi Chin Ang,

Yes. I am still holding onto my Hai Leck shares.

I guess the whole oil & gas sector is not doing well and Hai Leck is no exception. Plus the project based nature of their revenue as a service provider meant that they might be hit by low contract prices as oil companies cut their capex. I think they will not recover so soon as we can see the likes of MTQ also reporting lower revenue.

8:08 PM  
Blogger Chin Ang said...

Hi ghchua
Thanks for the information
Lets see if it issue div for the Quarter

6:35 AM  
Blogger ghchua said...

Hi Chin Ang,

Let's hope so. I certainly don't mind a small dividend payout from Hai Leck. :)

8:06 PM  
Blogger foolcj said...

GH Chua, DMX kena cEO and CFO arrested and release on bail for some silly things in HK police.

What are your views? And do you intend to offload based on this macro news?

11:00 PM  
Blogger ghchua said...

Hi foolcj,

I am still holding onto my DMX shares. Unless proven otherwise, we should give them the benefit of the doubt as investigations are still ongoing. Anyway, the CEO and CFO had already been suspended from all executive duties.

I think DMX is already trading at depressed levels. Offloading now doesn't make sense for me at all.

3:45 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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