Friday, June 28, 2019

My Investment Portfolio (June 2019)

STI ended the first half of the year at 3321 points, up from last month. Anticipation on hope of US-China trade deal, lower interest rate environment etc fueled market recovery. Though markets seems to have factored in some good news, I continued to be defensive in my portfolio positioning as interest had been seen in only selected big cap stocks like banks, property stocks and high yield counters like REITs and telcos.

For this month, I have attended the following AGMs/EGMs/briefing - General Magnetics and Challenger.

For my top 30 holdings, Isetan and SGX had been major movers in the list. For Isetan, the company announced that they will not renewing lease of Westgate mall outlet. SGX also announced restructuring to pursue growth. CapitaLand Mall Trust returned to the list as REITs performed well this month due to anticipation of lower interest rate going forward. Property stocks like UOL, Bukit Sembawang Estates and CapitaLand also performed well. Not much changes seen in the other stocks though.

I have bought the following companies from the market this month - Bonvests, Bund Center, Delfi, GK Goh, Global Testing, Heeton, Hiap Hoe, Hongkong Land, HRnetGroup, Koh Brothers, KSH, LHT, Lian Beng, Lum Chang, Mandarin Oriental, Pacific Century, Pollux, Sin Ghee Huat, Sing Investment & Finance, Singapura Finance, Stamford Land, UIC and Yeo Hiap Seng. I have also reduced my stake in Transcorp and closed my positions in KTL Global and Sen Yue.

I have accepted the following voluntary delisting/cash offers this month - Boardroom and Memtech.

Next month, companies with financial year ending 31 March 2019 will be conducting their AGMs. As usual, I will attend some of these meetings to get some updates from them. Also, I will continue to seek to re-invest slowly back into the markets, with emphasis on capital preservation.

My S'pore Stock Portfolio - Top Holdings, cash investment only (correct as at 28 June 2019

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

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

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

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

Top 5 Holdings (CPF OA investment)
1. Streettracks STI ETF
2. CapitaLand Mall Trust
3. Keppel Corp
5. SBS Transit

My Hong Kong Stock Portfolio
1. Peace Mark Holdings - Under Voluntary Liquidation
2. Z-Obee Holdings Ltd

My Australia Stock Portfolio
1. GPS Alliance Holdings Limited

My Unlisted Company Portfolio
1. Iconic Global Limited
2. Dongshan Group Ltd (formerly known as Greatronic Limited)
3. General Magnetics
4. Fastech Synergy
5. Beauty China - Under Liquidation
6. Memory Devices
7. Jurong Tech - In liquidation - Compulsory winding up (Insolvency)
8. FM Holdings
9. Zhonghui - In liquidation - Compulsory winding up (Insolvency)
10. FerroChina - Under Liquidation
11. FirstLink Investments
12. NEL Group
13. Jets Technics
14. Guangzhao Industrial Forest - In liquidation - Compulsory winding up (Insolvency)
15. Hongwei Technologies Limited (In Provisional Liquidation)
16. FDS Networks Group
17. Aussino Group - In Liquidation - Creditors' voluntary winding up
18. China Oilfield Technology
19. China Milk Products Group - Under Liquidation
20. Pacific Healthcare
21. Eratat Lifestyle - In Liquidation
22. Fung Choi Media - In Liquidation
23. K1 Ventures - In Liquidation
24. DMX Technologies - In Liquidation
25. Europtronic Group
26. China Sun Bio-chem Technology

My Unit Trust Portfolio:



Blogger Unknown said...

Why did U acceptboardroom offer?

2:35 AM  
Blogger Denver said...

I am a newbie investor, I just happen to saw that most of your stocks seems to be bought due to they are trading at a discount of the book value. I am more of a dividends growth investor, I am just curious do you intend to hold them for short term capital appreciation or intend to hold Long term for growth in dividends.

9:58 AM  
Blogger ghchua said...

Hi Unknown,

As you might have read, Boardroom's free float is now less than 10% and the offeror will not be taking any action to restore its free float. Which means, the stock will be delisted soon and shareholders who did not accept the offer will be left holding an unlisted company.

As I do not like to hold unlisted companies, I have decided to accept the offer and move on. The offer is also quite reasonable, considering that Boardroom will not be doing so well in the next one or two years at least, due to integration costs and increased staff costs from their new purchases.

Long term wise, I still like Boardroom due to the asset light nature of its business. Therefore, I have shifted my funds to offeror GK Goh to continue my exposure to the company.

7:41 PM  
Blogger ghchua said...

Hi Denver,

I have a mixture of various type of stocks in my portfolio but as you might have read my blog posts, I have decided to position my portfolio more defensively in recent years. Which means, my focus will be on stocks trading at a discount from their book value as you have correctly pointed out.

For stocks trading at a discount to their book value, the focus has never been on dividends or growth in dividends. Rather, it is on capital preservation. Stocks in this category are normally asset heavy and/or not doing well in their business. Some might pay a small dividend but it is difficult to anticipate dividend growth unless they unlock value to sell some of their assets to return cash to shareholders. The flipside is that stocks in this category are less volatile and therefore, one can hold on for long term and hope for value to be unlocked and/or business to recover one day. Some might be taken private by the controlling shareholder due to lack of market interest, which means you can exit at a premium from its last traded price one day. So, my time horizon for holding these stocks is for very long term.

For dividend growth stocks, I guess you are looking at stocks which exhibits growth in profits and dividends consistently, These stocks are normally asset light, pays a good portion of their profits out as dividends to shareholders. It is certainly quite different from those stocks that I am mainly targeting. I do add some of these stocks in my portfolio once in a while as you might have noted.

7:58 PM  
Blogger Denver said...

Ohh I see, thanks for clarifying my doubts.

8:16 PM  
Blogger Denver said...

Just started my own blog denversgportfolio.blogspot.com pls feel free to give any advice

10:23 PM  
Blogger faith said...

Hi Mr Chua,

I am really impressed by your well-diversified portfolio. You must well be collecting a 6 digit income by now. One thing that puzzled me is you don't seem to have any healthcare stock? Please advise.

Thank you.

1:45 AM  
Blogger ghchua said...

Hi Faith,

I do have healthcare stocks in my portfolio but they are not in my top 30 holdings. Reason being their valuation are not cheap enough for me to consider buying more shares of these companies. But my top holding Haw Par do have healthcare segment of their business due to their products from Tiger Balm brand.

Having said that, if you are referring to pure healthcare companies, I do prefer healthcare stocks with physical assets like hospitals. So, stocks like Raffles Medical, Parkway Life REIT, HMI and IHH are my top healthcare stocks in my portfolio.

4:24 AM  
Blogger Sunny said...

Shifu Chua

Do you have Propnex or APAC or both? Are they good buy at current price as sales seems to slow down? MF think APAC is below EV, how true is it?

How about UE, seems big main SSH are having actions, not sure any result will be good to minority? Is it good buy now?

MF says Singtel is not cheap as cash flow growth is only 1% PA but value is at 4%. Some funds are diverting out, some individuals thinks it always gets cheaper coming to Oct... What is your take?


5:37 AM  
Blogger ghchua said...

Hi Sunny,

No, I don't own any of the listed property agents. I did own Hersing previously before it was taken private and the property agency business had been re-listed as APAC. I don't like both Propnex and APAC as they had been aggressive in growing their business, and might be hit badly if there is a long downturn in the property market. I prefer AF Global, which owns a stake in Knight Frank.

United Engineers had been one of my top holdings for quite sometime. I still like the company as it holds a bulk of investment properties which sits on freehold land. I think value will be unlocked somewhere in the future, but not too sure when it will be.

Sorry, I don't comment on short term market movement, but SingTel is quite a well covered blue chip stock. I think Singapore market is saturated and long term wise, it will really depends on performance of their overseas associates. Also, they had been saying that they will unlock value from their internet start-up investments, so this is a space that is worth watching out too. I think long term wise, this stock's performance will depend on whether they can increase their dividend overtime. Presently, their cash flow is indeed quite tight and I only hope that they can maintain their payout. Anything else is a bonus.

4:46 AM  
Blogger Everlearning said...

Hi ghchua,

Do you have FSL Trust shareholdings? I was too distracted by other matters that I forgot to take up the subscriptions this year, thus causing much dilution to this investment.

If I were not take up the offer, does this stock still remains in the main board listing? I should have followed the news but not much was said about it.

May I just hear from you as I know you always hold an honest opinion of the stocks you invest in. Thanks in advance!

6:43 PM  
Blogger ghchua said...

Hi Everlearning,

Yes. I do have FSL Trust in my portfolio. Maybe I shall fill you in with some of the background since you had not been following it.

For the mandatory offer that the offeror had made, it is in line with the Trust Act as it was triggered as they hold more than 30% of the trust after the close of the Preferential offer. They failed to get a whitewash waiver from making the offer from unitholders at the EGM as the resolution was defeated.

As to your question on whether the units will remain listed after the offer closes, I think we have to look at the final acceptance rate. But if you ask me, chances of it being delisted is low as the IFA had said that the offer is "not fair but reasonable". So, I do not expect a high acceptance rate and chances are the trust will stay listed.

8:00 PM  
Blogger Everlearning said...

Hi ghchua,

Thanks! That saves me from making a trip down to SGX.

Having the experience from Aztech, I really dislike to submit documents against my wish. When I first invested with them, I always thought these companies are decent and surely they have a long way to go (not closing business abruptly) then it is no harm in investing with them for a decent dividend. Ultimately, the loss was so unspeakable painful enough for me to realize that I am not up to this kind of investment.

I am now overly skeptical about share holdings that investing in this has been dampened more than less. Unlike you, you remain strong and steady. But, I believe you too have your fair share of difficult times too.

8:33 PM  
Blogger ghchua said...

Hi Everlearning,

I am a full-time investor, so it is my "job" to look at investments.

Like any other job, being a full-time investor has its own ups and downs. But I am not a quitter and will not let setbacks defeat me. Rather, learn from my mistakes and try to be a better investor next time round.

Of course, there are difficult times but there are happier times too. Just stay on the course and enjoy the process. I think that is the most important lesson that I have learnt.

3:19 AM  
Blogger Unknown said...

Hello ghchua,

do you know for SGX-listed but USD-denominated stocks, whenever they give dividend, how do we ask CDP just to deposit into our respective DCS bank account rather than always sending a USD cheque to my house? (very tiring to keep visiting the bank to drop cheque)

4:36 AM  
Blogger ghchua said...

Hi Unknown,

I think for most stocks that are USD denominated but listed on SGX, they do have an option for shareholders to opt for SGD dividend and deposit those dividend into your bank account via DCS, Examples include Jardine group of companies like JMH, JSH, Hong Kong Land, Dairy Farm etc.

However, I do understand that some stocks do not participate in CDP's DCS service, which in this case they will send you a cheque that you will have to bank in yourself.

It is not CDP fault as the company did not participate in DCS. They will not be able to benk in your dividend via DCS even if they wishes to do so.

6:43 PM  
Blogger Paranoid said...

Hi, what do you see in Bonvests? Based on their profit it doesn't seem to be even slightly increasing these years.

5:30 AM  
Blogger ghchua said...

Hi Paranoid,

I think investors in Bonvests are looking at their assets, rather than profits. There are many ways to do investing, and looking at profits alone is not the only way to do it. I suggest maybe you could read up on other aspects of investing, in particular value investing.

6:51 AM  
Blogger Sunny said...

Shifu Chua

Looking at HKLand, believe it is worthy to enter at any time of the market. However, HK's status is different from the past and not sure where HK will head to and will the future direction affect HKL, Mandarin Oriental or Jar family? Also not sure any plan that HKLand, MO, and Jar family will be realizing the deep-trapped value. Wish to have your take especially on whether HKL current price is a good entering point...

Many Thanks in advance

6:54 PM  
Blogger ghchua said...

Hi Sunny,

HK Land assets are not all in Hong Kong, as they have assets in China, Singapore, Indonesia, Vietnam, Cambodia etc as well. Having said that, most of their investment properties are in Hong Kong and I can understand the reason for the recent selloff, due to fear on Hong Kong protests and future of the country.

I can't predict the future, but investing is really about buying and selling on incomplete information. If everything is fine, then HK Land won't be trading at current valuation of less than 0.4x book value. Considering that some of the small cap property companies in Singapore are also trading at these valuation, I think HK Land is trading at decent valuation at this moment.

Again, I can't predict what the Jardine group will do to their sister companies, but what I can say is that MO also presents decent valuation at this moment. If you revalued all the hotels in MO, I think current valuation of the company is also trading at less than 0.4x book value.

Ultimately, the process of value investing is looking at value companies to buy and hold. As to how long value will be unlocked, it can be less than one year, few years or even never. No one can tell you exactly when it will be.

9:35 PM  
Blogger Sunny said...

Shifu Chua

Thanks for the guide along the way. PropNex missed 1Q profit expectation, UOBKH downgraded it https://shentonwire.net/2019/08/20/propnex-downgraded-by-uob-kayhian-after-results-miss-expectations/?mc_cid=c0b8ff0ca1&mc_eid=01068d6a2f

6:59 PM  

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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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