Sembcorp Marine

On 10th September 2018 , we had witnessed the Beautiful white thrust bar which is able to breakout from the consolidated zone from $1.63 to $1.74 and close well at $1.77. Couple with High volume, we can roughly gauge that the Demand is back with a punch and surged higher to close well above its 20 Moving Average, this is rather bullish!

On 12th September we had another follow-through movement and continue to rise further to close well at $1.81. Today it has formed a doji on the chart. This could be an indication that it is taking a breather now. After this break, it may likely continue to move up to retest 1.86 then 1.94 with extension to 2.00 and above.

With Oil price hovering near US70 level, looks like it may retest US75 level soon.

Not a call to buy or sell.

Please do your own due diligence.



Sembcorp Marine Ltd, an investment holding company, provides offshore and marine engineering solutions worldwide. The company engages in the turnkey design, engineering, procurement, construction, and commissioning of offshore newbuilding and conversions, FSOs, FPSOs, FDPSOs, FPUs, MOPUs, gas terminals, FLNGs, FSRUs, jack-ups, semi-submersibles, drill ships, SSP solutions, TLPs, and SPARs. It also engages in the repair, refurbishment, retrofitting, life-extension, upgrading, and conversion of vessels, marine and offshore structures, LNG and LPG gas carriers, cruise ships, ferries, mega-yachts, floating production vessels, MODUs, tankers, containers, and cargo ships, as well as offers jumboization and dejumboization solutions. In addition, the company offers afloat and emergency repair, underwater cleaning and repair, main engine maintenance and repair, steel and pipe work, electrical and instrumentation repair, mechanical and motor rewind repair, tank cleaning, sludge and oily waste disposal, staging work, hydro jetting and hydro/vacuum blasting, riding crew and voyage repair, specialized workshop repair and reconditioning, vessel towage and port clearance arrangement, specialists service and navigation, automation, safety, and fire protection services. Further, it offers offshore platform solutions, such as integrated process; production, riser, and drilling; wellhead, power generation, manifold, and accommodation platforms; and wind-farm substations, as well as topside modules fabrication, installation, and integration. Additionally, it designs and builds sophisticated, specialized, gas value chain, ferry, RoPax, cruise, renewable energy and offshore support, naval support and security, and research and scientific survey vessels. The company was formerly known as Jurong Shipyard Ltd and changed its name to Sembcorp Marine Ltd in 2000. The company was founded in 1963 and is headquartered in Singapore. Sembcorp Marine Ltd. is a subsidiary of Sembcorp Industries Ltd.

Current Stock index value for DOW, STI & S&P situation

Let take a look at the current PE ( price to Earning ratio) for Dow , STI and S&P.

 Dow is trading at a PE of 23.18x which is deemed as Overvalued .

 S&P is trading at a PE of 21.10x which is also deemed as Overvalued.

 STI is trading at a PE of 10.78x which is deemed as Undervalued.


 Why do I say that both Dow and S&P is overvalued at the current moment? This is because when the PE ratio of the index is way above 15, the market is deemed as overvalued.

 This is where the index is trading near its Peak level Historically, I think we use PE ratio of 15 as the median indicator of measuring the Peak market level. So , if the index is trading below PE 15x , it is being viewed as Undervalued.

 Therefore, STI is trading below or near to market bottom of PE 10.78x, in my opinion , it is undervalued.

 Currently, Dow is trading at 26000 level and S&P at about 2900 level. In my opinion, it is trading at a peak level / risky level and may go through and major correction in time to come.

 Let take a quick recap when the financial crisis actually happened. It happens a few weeks before the crisis erupted, whereby stock market were at a very high level.

 At that time,Dow was trading at 14000 level. S&P is at about 1500 level. And STI was trading at about 3800 level.

 Dow declined about 55% for a span of 17 months from about 12000 level to 6500 level. STI losses about 61% from 3800 level to about 1600 level. So, is good to know the current market index level whether is it overly priced or undervalued.

 When the major market correction happens , across the board, all counter may experience heavily selling down pressure. I think at that time , Capitaland was trading at $1.80 level,SGX was trading at about $4.80 level and DBS at $7.00 level .

 Both companies are still profitable and giving out dividend. Today Capitaland is trading at $3.26 level,SGX is at $7.28 level and DBS at $24.32 level. So when a major market correction happen, you will roughly know when price may likely correct to a certain expected price level.


 This is to get ourselves to prepare in advance for any crisis to happen.Do you have a proper plan to guide you and ensure you are not being emotionally affected when the crisis happen.

 Not a call to buy or sell.

 Just sharing what I feel about the current market situation.

Hi-P & UMS

I think both are showing quite similar chart patterns as reflected on the chart. TA wise, looks rather Bearish!

 Hi-P

As can be seen from the chart, it has continued to go lower after hitting all time high of about $2.70+ and close lower at 90 cents yesterday, this is rather bearish.


I think is a very obvious downtrend mode direction.

Short term wise, I think we may experience a short rebound/throw-back situation.
I think it might not be a Good idea to Go Long rather it is an opportunity for those who want to exit/cut loss or take profit.

I wouldn't go long and bet for a counter trend scenario. The risk is super high.
I think any short rebound, could be a opportunity for Shortist to take advantage of the situation.

Not a call to buy or sell.

Please do your own due diligence.

Similarly for UMS, it is on a downtrend mode direction.
I think any short rebound could be a temporary situation.

Therefore, is good to exercise with extra cautious !

I think is good to have a proper plan and know what is the right trend and direction of the current stock counter.The trend is our friend! Don't fight with the trend!

Trade/invest base on your own decision.



Hi-P International Limited operates as an integrated contract manufacturer serving the telecommunications, consumer electronics, computing and peripherals, lifestyle, and medical and industrial devices industries. The company operates through three segments: Precision Plastic Injection Molding; Mold Design and Fabrication; and Provision of Sub-Product Assembly and Full-Product Assembly Services. It manufactures and sells molds and special tools, related housing appliance plastic components and equipment, and water treatment equipment; plastic components and plastic product modules; mold base and components; electric components and electronic communication equipment; in-mold decoration lenses; precision stamped metal components and precision tools; and metal and non-metal stampings, as well as provides spray painting, engineering support, maintenance, and technology consultation services. In addition, the company engages in the manufacture, wholesale, import and export, and sale of electronic telecommunication devices, housing appliances, automated equipment, and related components. Further, it manufactures and sells trays, mobile phones, telecommunication products, digital cameras and related electronic products, and electric toothbrushes; assembles coffee machines and parts, as well as provides related maintenance and after-sales services; and offers investment and management consulting services. Additionally, the company engages in the assembly and provision of ancillary value-added services, primarily surface finishing services. It has operations primarily in the People's Republic of China, Singapore, Malaysia, Thailand, Europe, the United States, the rest of Americas, and internationally. The company was founded in 1980 and is headquartered in Singapore.


UMS Holdings Limited, an investment holding company, provides high precision front-end semiconductor components, and electromechanical assembly and final testing services. It operates through two segments, Semiconductor and Others. The Semiconductor segment offers precision machining components and equipment modules for semiconductor equipment manufacturers. The Others segment provides water disinfection systems shipment services; and supplies base components to oil and gas original equipment manufacturers. The company also offers precision machining services, including milling, lathe, horizontal, cleaning, anodizing, and CMM; metal finishing services, such as electroless and selective nickel, anodizing, plating, e-polish, chemical cleaning, and parts refurbishment; and system integration, refurbishment, prototyping, and vendor managed inventory services, as well as electroplating services. In addition, it is involved in the assembly and integration of equipment and automated assembly lines; manufacture and assembly of stainless steel gaslines and weldment products; manufacture and repair of waste water treatment equipment; and holding of investment properties. The company serves semiconductor, electronic, machine tools, aerospace, and oil and gas industries. It operates in Singapore, Malaysia, the United States, Poland, Taiwan, South Korea, and the People’s Republic of China. UMS Holdings Limited was incorporated in 2001 and is headquartered in Singapore.

Accordia Golf Tr

The below is the discussion for this counter:
 Quote:
Jeremyowtaip

Hi Sporeshare, I present below the growth of Accordia Golf Trust (AGT) and other salient points about it to see whether this is a safe and attractive investment or not.

AGT according to their website is a business trust which derives income from it's investment in golf courses, driving ranges and golf course related assets in good locations in Japan. They have the vision to venture out to other geographical regions but have yet to do so. The sponsor of AGT is the largest golf course operator in Japan.

I looked at the growth of AGT for the past 3 years (2015 to 2018) since it was public listed only in second half of 2014. For the past 3 years, AGT has grown it's revenue by a CAGR of 0.75%. Operating profit has remained stagnant and not grown over the past 3 years. Profit attributable to unitholders has grown by a CAGR of 1.78%. Profitability wise, it seems that there is not much showing for AGT in terms of growth.

 However, a short 3 years may also not be a good gauge of their growth. Therefore, I think more time is needed to observe them before reaching a fair conclusion on their growth in this aspect of profitability.

Now onto their balance sheet. As of 31 Mar 2018, AGT's current ratio stands at 0.24. 

It's debt to equity ratio stands at 0.54. 

Over the past 3 years, AGT has not grown it's unitholders' equity. 

Unitholders' equity has declined from JPY83,393 million in 2015 to JPY79,802 million in 2018. This means that AGT has not grown the value of the investment capital that unitholders have put up with AGT over the past 3 years and instead AGT has caused the investment value to decline.

 This is due to accumulated losses in the recent two years which has caused the decline in unitholders' equity.

Onto their cashflows, AGT has since it's IPO in late 2014 and thereafter from 2015 onwards which was flushed with cash, saw it's cash level slowly depleting. There was net outflow in cash every year from 2016 to 2018 though not at a fast rate. The cash outflows in distributions to unitholders have declined every year from 2016 (JPY7881 million) to 2018 (JPY4696 million). It seems that AGT has either intentionally or being forced to decrease it's amount of cash distributions to their unitholders due to tight cashflows over the past 3 years.

The unit price of AGT has decreased from it's IPO price of SGD0.97 to current price of SGD0.55. Over the course of about 4 years based on unit price performance alone, AGT has caused the value of an initial unitholder investment in it to be eroded by about 43.3%.

 This translates to a compounded annual loss of about 12.7% over the past 4 years in terms of unit price performance. I doubt the distributions unitholders have collected over the past 3 years can cover the annual loss in value of the unit price over this same period.

Therefore in conclusion, I will not consider AGT to be a safe and attractive investment for a business trust and certainly one that will not fall under my radar. Unless it can prove itself otherwise in future showing improvements over the earlier salient points mentioned then will I take another second look at it.

NAV of 89.8cents.

P/b of 0.6x

DPU of 3.9 cents

Yield is about 7%.

Not a call to buy or sell.

Please do your own due diligence!

Ascendas Reit versus AimsAmp Reit

This is just to share our discussion and view for these 2 reits counters:


jeremyowtaip

Hi , I think the private placement will have little effect on the dilution of units in Ascendas REIT (A-REIT) as based on their announcement, the number of new units issued under private placement is only about 6.1% of the total number of existing units. I did an estimation of the theoretical ex-placement price to be around $2.63. The market somehow knows how to price the unit price correctly as it last closed on past Friday also at $2.63.

Based on A-REIT's own announcement on their rationale for the private placement, it was meant to raise funds for acquisition of a UK portfolio of 12 properties which A-REIT thinks will increase long term distributions for unitholders. The funds raised from private placement was also to be used for a built to suit property development, for repayment of some debts, for reducing their gearing, for setting aside some cash for future acquisitions and also to increase trading liquidity of it's units. It seems that A-REIT has good rationale for doing this private placement. I provide a link below for further read on A-REIT's recent private placement.

I also made some comparisons below between A-REIT and AA-REIT which I am currently vested in the latter to see which has been a better performer over the past 9 years. I have been wanting to do this comparison for long time already. Now that you asked me why A-REIT has traded at a higher premium in terms of higher P/NAV ratio than it's peers, I believe there must be good reasons for it being a higher priced investment than other of it's peers. Let us see below.

Over the past 9 years, A-REIT has grown it's revenue at a CAGR of 9.02%. It has grown it's net property income at a CAGR of 8.72%. It has grown it's distributions to unitholders at a CAGR of 9.27%. It has grown it's value of investment properties at a CAGR of 9.63%.

Now, let us take a look at AA-REIT's performance for the past 9 years. AA-REIT has grown it's revenue at a CAGR of 9.7%. It has grown it's net property income at a CAGR of 8.44%. It has grown it's distributions to unitholders at a CAGR of 12.05%. It has grown it's value of investment properties at a CAGR of 9.6%.

Based on the above important comparison metrics, we can see that both REITs are quite similar in their growth performance. Therefore, A-REIT is certainly trading at a higher valuation than AA-REIT even though they are quite comparable in their growth performance over the past 9 years. Probably, investors are paying a higher premium for a larger industrial REIT in A-REIT which has some good amount of overseas exposure in UK and Australia. As for AA-REIT, they only have overseas exposure in one freehold business park property in Australia currently leased to Singtel Optus.

It really depends on individual investor's choice. If one is looking at more diversification across more geographical regions in a larger size industrial REIT, then A-REIT is a potential investment candidate. If the investor does not mind a smaller REIT with less overseas exposure but nevertheless has quite decent performance to it's larger peer and trading slightly cheaper in valuation, AA-REIT is a potential investment candidate.

Do note that my sharing is by no means a complete exhaustive discussion and conclusion on the investment worthiness of both REITs. Nevertheless, it is a starting point on some important comparisons between both REITs.

"Hot stock: Ascendas Reit units down 2.6% after manager prices S$452m placement at S$2.54 per unit" by The Business Times 

https://www.businesstimes.com.sg/companies-markets/hot-stock-ascendas-reit-units-down-26-after-manager-prices-s452m-placement-at-s254

simonloo

Reply to @jeremyowtaip : Good write up. I always wanted to buy Ascendas Reit but wonder what would be a “good” entry price as now. Any advise?

Bobbilipuli

Reply to @jeremyowtaip : Excellent write up! May I also add one thing- "brand equity". Ascendas benefits from its name and visibility all over SG just like Mapletree group. This plus the facts that you set up gives it an edge. Am vested in both and look forward to topping up both at next pull back!

Sporeshare

Reply to @jeremyowtaip : TQ! You are really an experience and wise detail investor! Is always good to hear your view ! Would analyse and make my own judgement!! Have a nice day!

Chip Eng Seng , Sheng Siong & Hong Lai Huat - Uptrend counters

These are the few uptrend counters that I have observed at this moment! The market is gearing towards down side as STI has broken down the 3200 level and is on the verge of re-challenging 3100 level. Breaking down of 3100 level would smell troubles and super bearish as market may kicks into BEAR Mode.

 This is just for sharing and not a call to buy or sell.

 Please do your own due diligence.


 1. Hong Lai Huat - From the chart we can notice that after touching the low of 15 cent, it has managed to stage a strong recovery and surge higher to hit the high of 28 cents . This is rather positive!

 It is now taking a break( 25.5 cents) and may likely re-attempt this recent high of 28 cents. The volume bar with many huge volume transacted indicate that DEMAND is strong. This driving force may likely drive the price higher above 28 to test 30 then 35 with extension to 44 cents.

2. Chip Eng Seng - After being sold down from $1.07 to touch the low of 77 cents, it had managed to stage a strong recovery and rises to hit 87.5 cents. This is rather bullish!

Short term wise, I think it may likely move up to re-attempt this 87.5 cents level after taking a short break(86 cents). Breaking out of 87.5 cents with high volume that may drive the price higher towards 90 then 92 cents.

3. Sheng Siong - After touching the low of 85 cents, it has managed to stage a strong rebound and rises higher to hit the all time high of $1.19. It is now taking a break($1.14) and may likely re-challenge this 1.19 level.

Breaking out of $1.19 with good volume, that may propel to drive the price higher to wards 1.25 and above.


I think is always good to lock in profit especially it has been risen from 85 to 1.19..

Trade/invest base on your own decision.


Hong Lai Huat Group Limited focuses on the property development and agricultural investment activities. The company operates through Agriculture, and Property Development and Real Estate divisions. It engages in the business of agricultural development, cultivation, branding and merchandising, and distribution of cassava under the CAMFARM brand. The company cultivates cassava in approximately 11,000 hectares of land in Cambodia; and produces cassava starch and dry cassava chips. It also invests in and develops commercial and residential properties. The company develops HDB projects, community centers, public schools, shopping malls, private residential properties, apartments, and industrial properties in Singapore; and a freehold mixed development project in Cambodia. The company was formerly known as HLH Group Limited and changed its name to Hong Lai Huat Group Limited in April 2018. Hong Lai Huat Group Limited was founded in 1988 and is based in Singapore.


Chip Eng Seng Corporation Ltd, an investment holding company, engages in the construction, property development and investment, and hospitality businesses primarily in Singapore, Australia, Malaysia, and Maldives. The company operates through Construction, Property Developments, Property Investments, Hospitality, and Corporate and Others segments. The company constructs public housing projects, condominiums, and executive condominiums, as well as industrial and commercial projects; develops residential, commercial, and industrial properties, as well as manages development projects; and provides real estate management and consultancy services. It also leases investment properties, such as shophouses, and commercial and industrial properties; operates hotels and island resort; engages in treasury functions; and invests in marketable securities. In addition, the company acts as general building contractor; manufactures and trades in precast products; and provides general building engineering services. Chip Eng Seng Corporation Ltd was incorporated in 1998 and is headquartered in Singapore.

Sheng Siong Group Ltd., an investment holding company, operates supermarkets in Singapore. The company’s stores offer an assortment of live, fresh, and chilled produce, such as seafood, meat, and vegetables; and packaged, processed, frozen, and/or preserved food products, as well as general merchandise, including toiletries and essential household products. It is also involved in general trading, and wholesale import and export businesses. The company operates approximately 48 supermarkets/grocery stores under the Sheng Siong brand name. Sheng Siong Group Ltd. was founded in 1985 and is headquartered in Singapore.