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28 June 2016
Why SingPost investors will see more pain before gain: Maybank
Maybank is initiating coverage on postal service provider Singapore Post (SingPost) at a “sell” rating with a price target of $1.29.
SingPost, an associate company of Singapore Telecommunications, is currently trading at “peak valuations” as potential for further negative newsflow has yet to be priced in, says analyst John Cheong in a Monday report.
He believes investors are “too optimistic” for the following reasons:
1. SingPost’s M&As face a long gestation period
The company embarked on its mergers and acquisitions (M&As) in 2011 in a bid to evolve from its domestic-mail monopoly into an international e-commerce logistics provider. On this, Cheong notes that even with SingPost’s current provision of various e-commerce logistics services in the Asia Pacific, most of its acquisitions have “not added much” to synergies or earnings. He adds that SingPost’s acquired businesses are “small players” face intense competition in their fields. “More investments would be needed for its customer acquisitions and scale economies,” Cheong reckons.
2. Alibaba’s second investment deal may be under threat
Alibaba, SingPost’s 10.2% stakeholder, has extended its long-stop date for its second investment in SingPost thrice. Cheong comments that the transaction is taking “much longer” than the companies’ first share transaction in 2014. As such, Cheong highlights there may be risks of the deal not following through, as there is the possibility that Alibaba may choose to expand its Asean logistics capability in-house using Lazada’s logistics network instead.
(See: "Has SingPost-Alibaba JV hit a snag?")
3. Inability to resolve corporate-governance conundrum
After former CEO Wolfgang Baier’s resignation 2015, it has been revealed that one of the company’s directors had not declared his interest in a previous acquisition. The group has since seen its chairman and two directors step down, while Baier’s position remains unfilled. Furthermore, with the impending results of a corporate-governance review by Hendrick & Struggles next month and possibly more investigations into breaches of the Companies Act by ACRA since it began looking into SingPost’s activities last month, Cheong thinks the “air may not clear in the long term”.
(See: "SingPost group CEO Wolfgang Baier resigns")
(See: "Keith Tay steps down at SingPost’s nominations committee")
For now, Cheong expects SingPost’s dominant mail business, which he points out is “highly cash-generative but declining” to provide support before its e-commerce logistics arm begins to compensate.
http://smr.theedgemarkets.com/article/why-singpost-investors-will-see-‘pain-gain’-maybank
25 June 2016
Post Brexit 25/6/16
Last morning was not the usual Friday morning but an epic one.
Phones ringing every 2 mins, not to mention a spate of messages bombard stockbrokers' handphones. Markets were swinging wildly, clients were worried and brokers were all watching the numbers on the screen closely.
There was no time to have long conversations over the phone and information was exchanged quickly between colleagues and clients. And every hour there will be a client calling in asking how to place trades, or to reset their passwords because they have not used it for long (i am not IT to reset the password, in fact i cant). Every second count, but we do our best to help everyone.
Once #brexit is confirmed, markets took a concerted dive with ocassional recovery. 3pm (GMT +8) once EU markets opened, there was another round of selling. Every single market took a hit. Subsequently US market too. Everything was just red and redder.
Yet one for sure, we will have a peaceful weekend. No more phone calls, no more messages, no more weird calls. At times like this, I have strangers who got no trading account with me, calling me to hear my views, and hang up after that. Seriously. Of course, I have clients who get news from me and trade through other houses too. This is not business for there is no mutual support. Pardon me but i have been awake for 28 hours... After i was done with US market, i lost my sleep. probably due to all the excitement.
Looking at the results, looking at the breakdowns, it's interesting to note that the young chose Bremain. The old however has a wrong perception of patriotism, hanging on to the gone ideas of commonwealth. There will be upcoming unforeseen implications and consequences.
UK's economy is largely based on tax and services, unlike in the past. Brexit meant a change of ball game, lesser rules and regulations from the EU which is what the Brits wanted in the first place. That also translates to the kind of asset class and what shares to buy and avoid.
Certainly one for sure, the working class will be the first victims of Brexit.
Further elaborations and explainations, please contact me. :)
HAVE A GOOD WEEKEND~!
Phones ringing every 2 mins, not to mention a spate of messages bombard stockbrokers' handphones. Markets were swinging wildly, clients were worried and brokers were all watching the numbers on the screen closely.
There was no time to have long conversations over the phone and information was exchanged quickly between colleagues and clients. And every hour there will be a client calling in asking how to place trades, or to reset their passwords because they have not used it for long (i am not IT to reset the password, in fact i cant). Every second count, but we do our best to help everyone.
Once #brexit is confirmed, markets took a concerted dive with ocassional recovery. 3pm (GMT +8) once EU markets opened, there was another round of selling. Every single market took a hit. Subsequently US market too. Everything was just red and redder.
Yet one for sure, we will have a peaceful weekend. No more phone calls, no more messages, no more weird calls. At times like this, I have strangers who got no trading account with me, calling me to hear my views, and hang up after that. Seriously. Of course, I have clients who get news from me and trade through other houses too. This is not business for there is no mutual support. Pardon me but i have been awake for 28 hours... After i was done with US market, i lost my sleep. probably due to all the excitement.
Looking at the results, looking at the breakdowns, it's interesting to note that the young chose Bremain. The old however has a wrong perception of patriotism, hanging on to the gone ideas of commonwealth. There will be upcoming unforeseen implications and consequences.
UK's economy is largely based on tax and services, unlike in the past. Brexit meant a change of ball game, lesser rules and regulations from the EU which is what the Brits wanted in the first place. That also translates to the kind of asset class and what shares to buy and avoid.
Certainly one for sure, the working class will be the first victims of Brexit.
Further elaborations and explainations, please contact me. :)
HAVE A GOOD WEEKEND~!
24 June 2016
UK voted to LEAVE EU
Given that UK has voted to leave EU, this is a major change in the market environment. As such, expect some volatility in the market.
Please watch for the bluechip shares such as :
Also you may want to avoid Singpost, Sembcorp, Keppel and Genting
my 2 cents.
Please watch for the bluechip shares such as :
- Comfort Delgro
- DBS
- UOL
- Ascott Reits
- Raffles Medical (trade within the range 1.50 to 1.58)
- SPH
Also you may want to avoid Singpost, Sembcorp, Keppel and Genting
my 2 cents.
Brexit time line for today and tml
dear friends,
fyi
Polls to open (SG time) - 3pm (Thurs) - 6am (Fri)
First Result (SG time) - 8am (Fri)
Final Result (SG time) - 12pm (Fri)
fyi
Polls to open (SG time) - 3pm (Thurs) - 6am (Fri)
First Result (SG time) - 8am (Fri)
Final Result (SG time) - 12pm (Fri)
20 June 2016
M1 and other telcos
Telecoms: MyRepublic's misfortune could be M1's gain
- M1 could be in the running to be a market dark horse
- Channel checks suggest that the two frontrunners, MyRepublic and Consistel are still seeking to raise substantial funds
- spectrum auction that is expected to be held in 3Q16
- M1 (Hold, TP: $3.09) could potentially see a substantial re-rating particularly since it is currently trading at a relatively attractive FY16E yield of 6%
- Notwithstanding, Maybank KE continues to like Singtel (Buy, TP: $4.50), and StarHub (Buy, TP: $4.15)
17 June 2016
comfort delgro, KLW, ezra
Jo Cox dead: EU referendum campaigning suspended after Labour MP killed in shooting and stabbing.
As such, my guess is markets may have a short rally as prices have fallen quite a fair bit over the past few days due to Brexit uncertainties.
as of now, futures are trending up, Tokyo nikkei opens high too.
stocks to watch:
comfort delgro, KLW, ezra
if you have stock tips, feel free to share.
http://www.independent.co.uk/news/uk/politics/jo-cox-shot-eu-referendum-campaigning-suspended-leave-remain-brexit-labour-mp-critically-injured-a7085771.html
Click on the link for details.
https://research.uobkayhian.com/content_download.jsp?id=34597&h=72d2dc616bbb33717dff9126539887cf
This transmission has been issued by a member of the UOB Kay Hian Group for the information of the addressee only and should not be reproduced and/or distributed to any other person. Each page attached hereto must be read in conjunction with any disclaimer which forms part of it. Unless otherwise stated, this transmission is neither an offer nor the solicitation of an offer to sell or purchase any investment. Its comments are based on information obtained from sources believed to be reliable but UOB Kay Hian Group makes no representations and accepts no responsibility or liability as to its completeness or accuracy.
As such, my guess is markets may have a short rally as prices have fallen quite a fair bit over the past few days due to Brexit uncertainties.
as of now, futures are trending up, Tokyo nikkei opens high too.
stocks to watch:
comfort delgro, KLW, ezra
if you have stock tips, feel free to share.
http://www.independent.co.uk/news/uk/politics/jo-cox-shot-eu-referendum-campaigning-suspended-leave-remain-brexit-labour-mp-critically-injured-a7085771.html
Click on the link for details.
https://research.uobkayhian.com/content_download.jsp?id=34597&h=72d2dc616bbb33717dff9126539887cf
This transmission has been issued by a member of the UOB Kay Hian Group for the information of the addressee only and should not be reproduced and/or distributed to any other person. Each page attached hereto must be read in conjunction with any disclaimer which forms part of it. Unless otherwise stated, this transmission is neither an offer nor the solicitation of an offer to sell or purchase any investment. Its comments are based on information obtained from sources believed to be reliable but UOB Kay Hian Group makes no representations and accepts no responsibility or liability as to its completeness or accuracy.
15 June 2016
Please LIKE our Facebook page
If you enjoy my postings and sharings, please LIKE the SGSAS page.
Your small gesture will motivate me to maintain and contribute this site, bringing it to greater heights.
Thank you for your support.
Your small gesture will motivate me to maintain and contribute this site, bringing it to greater heights.
Thank you for your support.
10 June 2016
My apologies
thanks for the feedback.
some of the posts have very small fonts. I sent it out via email and it, for some strange reason, changed the entire font structure.
will note on that and ensure 'read-ability'
some of the posts have very small fonts. I sent it out via email and it, for some strange reason, changed the entire font structure.
will note on that and ensure 'read-ability'
Trading idea: KLW 504
I have been watching this counter for the past few weeks, KLW (504) and decided to share with all.
This is a company producing furniture. Their financial are improving with multi sources of income. I have provided a copy and a screenshot of the SGX financial report on this company. NAV is about S$0.0130, current price about S$0.008.
This is suitable for trading, probably investing comes later.
Should you have any insights or views, feel free to share.
screenshot:
More : http://infopub.sgx.com/FileOpen/KLW_FY15-16_Results.ashx?App=Announcement&FileID=407103
08 June 2016
4 Reasons Why COMFORTDELGRO CORPORATION Might Be Worth A Look Now
SI RESEARCH: 4 REASONS WHY COMFORTDELGRO CORPORATION MIGHT BE WORTH A LOOK NOW
Tan Jiahui June 6, 2016 Stock Market
Singapore is well known to be one of the most expensive countries in the world to own a car. Given the high costs of car ownership, most people living in Singapore turn to public transport for their daily commute. Thus, ComfortDelGro Corporation (CDG) – Singapore’s largest public transport provider – should be a name that is familiar to most living in the city-state.
Well-diversified Business With Sustained Earnings Growth
Zooming in first on CDG’s financial performance, we are happy to note that the group has recorded top- and bottom-line growth in the past five financial years. Revenue grew at a compounded annual growth rate (CAGR) of 4.8 percent from $3,411.1 million in FY11 to $4,111.5 million in FY15 while earnings registered a decent 6.4 percent CAGR in the period to reach a record $301.9 million.
On the back of the sustained improvement in performance, the firm has rewarded shareholders with increasing dividend per share (DPS) in each of the past five years. Between FY11 and FY15, DPS has gained 50 percent to $0.09, which translates to a modest 3.3 percent yield based on the close price of $2.74 per share as of 31 May.
Apart from the good financial track record, the group’s well-diversified business is something we like. While CDG is the clear leader in the Singapore’s public transport sector, many might not know that it is actually also the second-largest land transport company in the world. As of FY15, CDG has operations in 7 countries and 36 cities; the firm derives more than 40 percent of turnover and operating profit from overseas operations.
The geographical diversification is certainly a plus point as weakness in a particular market can be mitigated by performances of its other markets and this stands out in comparison to competitor SMRT Corporation, whose operations are only based in Singapore.
Strong Balance Sheet Opens Up Opportunities For Acquisitions
Besides sporting strong operational results, CDG also boasts a strong balance sheet that has net cash of approximately $392.6 million as of 31 March. Total debt to equity is low at 0.16 times and the low gearing opens the firm to possibility of more acquisitions. In particular, the group’s management has expressed interest to further expand overseas given the saturated market in Singapore.
CDG’s business is also one that generates strong operating cash flows, which translates to positive free cash flow in most of the past years. The ability to generate positive cash flows and a strong balance sheet has enabled the company to increase dividend payouts as mentioned in the section above.
Share Price Has Fallen 9% Year To Date
As of 31 May, CDG’s shares closed at $2.74, down 8.7 percent from the close price of $3.00 on 4 January. The decline is in contrast to a year-to-date 1.6 percent fall in the benchmark Straits Times Index.
While global uncertainties could have affected the group’s share price performance, the share price movement could also be attributable to other factors including perceived threats from private-hire services and lower expectations of a cash windfall from its bus assets sale.
Firstly, the increased availability and popularity of private-hire services like Uber and GrabCar is seen as a threat to CDG’s taxi business, which is one of its largest profit contributors. However, we opine that the firm’s local taxi business remains robust as taxi hire rates remain at 100 percent as at end-1Q16.
While management noted the queue for hirers has shrunk significantly, investors should not be overly alarmed. Although the new private-hire services have initially enticed drivers to join by giving out better benefits and thus reducing new demand for taxi rentals, we note that these are slowly being cut back.
Next, despite news that the transition to a government-contracting model (GCM) for public bus services will happen by September 2016, not much details has been shared about what would happen to the current bus assets of the incumbents including CDG.
Initially, analysts and investors had expected a windfall from the sale of bus assets to the government in 2016. However, based on the Singapore Budget 2016 announced in March, it appears unlikely that the government will take possession of the bus assets from the existing operators and do a one-off payout. The situation has led to disappointment for those who expected a special dividend from the group pursuant to a sale of the bus assets.
Even though there are no details on the possible asset sale, the transition to a GCM model by September is expected to improve margins in CDG’s local bus segment. Under the new model, capital expenditure will likely decrease, which helps boost free cash flow and increases possibility of a higher dividend payout (something investors would be happy to hear).
Rail Business Expected To Pick Up
The Downtown Line (DTL), which is operated by CDG’s unit SBS Transit, opened its first six stations in December 2013. Subsequently, the second stage of DTL opened in December last year and now there are 18 stations in operation that connects Bukit Panjang to Chinatown. Most would likely agree that travelling time and connectivity for residents staying along the DTL has vastly improved.
Ridership on the DTL has been steadily increasing especially after the commencement of Phase 2, though lower than what management had initially forecasted. That said, CDG’s rail performance should see a steady improvement as ridership on the DTL continues to grow. The Land Transport Authority forecasts that DTL’s daily ridership would more than double to 500,000 when Stage 3 opens in 2H17.
Conclusion
Overall, we see the provision of public transport services as a fairly resilient business given that public transport is a necessity to those who do not own cars. Given that share price has experienced some correction, investors might be interested to add CDG to their watchlist as looking ahead, a transition to an asset-light model for the bus business in September and the current low fuel costs environment should support margin improvement.
Further catalyst could come from the finalisation of the sale of bus assets and new acquisitions. Notable downside risks include a sudden sharp recovery in crude prices and stronger than expected competition from private-hire services.
Taken from: http://aspire.sharesinv.com/26937/si-research-4-reasons-why-comfortdelgro-corporation-might-be-worth-a-look-now/
07 June 2016
Congrats to clients who bought mermaid maritime security
For more details, please read my earlier posts.
Happy for my clients! :)
06 June 2016
Comfort Delgro (C52)
I noticed that Comfort Delgro has been dropping over the past weeks.
based on research reports, it is valuated at an average price of around S$3.00. This is a defensive counter, thus will be good to pick up some for investments while the price is falling.
The previous low was S$2.50 around Aug 2015. Please spread your purchases so that you can average down if the prices were to fall lower.
based on research reports, it is valuated at an average price of around S$3.00. This is a defensive counter, thus will be good to pick up some for investments while the price is falling.
The previous low was S$2.50 around Aug 2015. Please spread your purchases so that you can average down if the prices were to fall lower.
02 June 2016
Sinograndness
I'm on leave today. But I got a pleasant surprise from my clients, about one of my counters, Sinograndness.
If you have been following my posts, u realised that I have been calling for this for quite some time.
Glad that you all made money. That's how investing/trading should be. :)
Cheers!
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