Wednesday, May 31, 2023

My Investment Portfolio (May 2023)

STI ended May at around 3158 points, down more than 100 points as compared to last month. US government debt ceiling and recession fears were the two main issues bothering the markets. China's patchy recovery post Covid restrictions was another main concern. A lot of counters went ex-dividend in May, which also explains Singapore market weakness this month. There was also concern that Singapore might go into a technical recession as annual GDP growth slowed in the first quarter of this year. 

For my top 30 holdings this month, main movers include Sembcorp Industries and Delfi. Delfi had updated the market on its 1Q23 performance. PM Data also did well after releasing their full year result while The Hour Glass and Bukit Sembawang Estates disappointed. Major laggards include Samudera Shipping and Global Testing, after the stocks went ex-dividend and ex-entitlement respectively. Not much changes was observed for the other stocks in the list.

I have bought the following companies from the market this month - Amara, Asia Vets, AV Jennings, Baker Tech, Bonvests, Bund Center, Chuan Hup, City Developments, ComfortDelgro, EnGro, F&N, Far East Orchard, Frasers Property, Guocoland, Heeton, Ho Bee Land, Hong Leong Asia, Hotel Grand Central, Hotel Royal, IFS Capital, Intraco, IPC, Isetan, Karin, Koh Brothers, Mandarin Oriental, MindChamps, Nam Lee, OUE, Overseas Education, Sakae, SBS Transit, Secura, Shopper360, Silverlake Axis, Sinarmas Land, Singapore Land Group, Singapore Shipping, Straits Trading, Taka Jewellery, Tan Chong International, TIH, Trek 2000, Tye Soon, UOL, Wing Tai, Yanlord and Yeo Hiap Seng. No sale trade was done.

I have participated in the following preferential offer/rights issue - Keppel Infrastructure Trust.

I have participated in the following scrip dividend schemes - UOB Kay Hian, Global Investments, Tuan Sing, Yeo Hiap Seng and China International.

"Sell in May and Go Away" seems to be the name of the game this month. However, with some cash in hand after the GK Goh offer and dividends received this month, I have managed to re-invest some of those proceeds. Though there is still some cash drag, I will continue to seek value and try to re-invest slowly back into the market. With headwinds ahead and markets not expecting to perform well again this year, I will remain cautious and continue to hold more cash going forward.

My S'pore Stock Portfolio - Top Holdings, cash investment only (correct as at 31 May 2023)

Top 30 Holdings (Sing$ Denominated shares)
1. iFAST
2. Hong Fok
3. The Hour Glass 
4. Hong Leong Finance
5. Jardine C&C
6. Bonvests
7. Sing Investment & Finance
8. Hotel Properties
9. Sembcorp Industries
10. PM Data
11. Hotel Grand Central
12. Samudera Shipping
13. Metro Holdings
14. Stamford Land
15. Delfi
16. LHT
17. Far East Orchard
18. Hiap Hoe
19. Yeo Hiap Seng
20. Wing Tai
21. Global Testing
22. Amara
23. Singapura Finance
24. CapitaLand Ascendas REIT
25. CapitaLand Integrated Commercial Trust
26. Isetan
27. Bukit Sembawang Estates
28. Singapore Land Group
29. Tat Seng
30. EnGro

Top 5 Holdings (US$ Denominated shares)
1. Mandarin Oriental
2. Hongkong Land
3. Jardine Matheson
4. TZ Da Ren Tang
5. DFI Retail Group

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

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

Top 5 Holdings (CPF OA investment)
1. Streettracks STI ETF
2. Keppel Corp
3. CapitaLand Integrated Commercial Trust
4. CapitaLand Ascendas REIT
5. Best World

My Hong Kong Stock Portfolio
1. Peace Mark Holdings - Under Voluntary Liquidation
2. Alpha Professional Holdings Ltd (formerly known as 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. Memory Devices
6. Jurong Tech - In liquidation - Compulsory winding up (Insolvency)
7. FM Holdings
8. Zhonghui - In liquidation - Compulsory winding up (Insolvency)
9. FerroChina - Under Liquidation
10. FirstLink Investments
11. NEL Group
12. Jets Technics
13. Guangzhao Industrial Forest - In liquidation - Compulsory winding up (Insolvency)
14. Hongwei Technologies Limited (In Provisional Liquidation)
15. FDS Networks Group
16. Aussino Group - In Liquidation - Creditors' voluntary winding up
17. China Oilfield Technology
18. China Milk Products Group - Under Liquidation
19. Pacific Healthcare
20. Fung Choi Media - In Liquidation
21. DMX Technologies - In Liquidation
22. Europtronic Group- In Liquidation
23. China Sun Bio-chem Technology
24. Attilan Group
25. Transcorp
26. Koon Holdings  - Under Liquidation
27. Equatoriale Holdings  
28. China Haida
29. Chaswood Resources



Blogger Jon said...

Hi ghchua,

I see that you have Stamford Land in your portfolio for many years, and have been adding to your position from time to time.

I was just wondering what is your view on whether minority shareholders will ever be able to realised the value trapped in this stock.

The latest FY23 financial statements put cash/ share at 27.5 cents per share against a share price of 38 cents. Total Cash is $410M vs Mkt Cap at 567M.

The majority shareholder owns 64% of shares, so technically, the takeover cost to him, at current share price would be just $204M, which could be easily funded by the company cash, upon gaining control.

The Hotels are valued at Purchase Cost - Depreciation, while the investment property is mark to market.

Without going into further detail, on numbers alone, this stock very undervalued, trading at between 30% to 40% of RNAV.

In the years 2015 and before, the company used to be very generous in sharing gains with shareholders, paying a dividend yield of at least 5%. Annual reports also seem to be written in a much more positive tone, that was keen to share business developments with shareholders.

However, after 2015, this changed drastically. The cut in dividends is obvious, but the commentary in Financial results and the annual report is very curt, and there seems to be little interest in sharing profits with minorities. The company even resorted to suing a shareholder.

Do you have an exit strategy for this stock? Or are you just intending to wait and see?

Any insights would be greatly appreciated.

Thank you


Dividend History

3:11 AM  
Blogger ghchua said...

Hi Jon,

You might wish to note that they are paying a special dividend this time round, on top of the normal dividend due to gains from divestment of Stamford Plaza Auckland and Sir Stamford Circular Quay. Also, they have paid off all their bank borrowings. So, they are now not only in a net cash position, but also zero borrowings.

The cut in dividend after 2015 is partly because of the challenging environment and also they are looking to diversify away from Australia and New Zealand properties. After that, they have bought in UK but unfortunately, the situation is not too good in UK now either.

Hotel companies are asset heavy. If you look at similar SGX listed hotel companies, most have reduced their dividends in recent years. But I am not buying these companies for dividends only, and the value is really on the location of assets they owned and/or those freehold land that their assets are sitting on.

For Stamford Land, I think the end game would be privatisation. Whether it will come sooner or later, I really don't know. Meanwhile, one could say that it is a value trap, but downside is also limited as it is supported by its RNAV.

5:15 AM  
Blogger Jon said...

Thanks very much for your insights ghchua.

I think privatisation is the most likely outcome too. It would give the owner a lot more flexibility as less regulatory burden when investing the company's capital

5:49 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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