Friday, September 24, 2021

Timed the market or time in the market?

Actually, how about both?

Both are not mutually exclusive. 

If u got in at a market high, u need to spend a longer time in market to earn the MOS ( margin of safety), if u timed in correctly, u are less at risk leaving the portfolio to gain dividends. If u are able to get baggers, u can profit take and it became zero risk, until u put the money into use again.

CW call it trading around core positions. 

Doesn't matter the semantics, the important part is portfolio allocation into Cash or other equivalent asset class. The percentage of which is trial and error, until u find one that works.

But either way, u need to need some FA knowledge. Seriously, if u listen to Gurus talking about TA, like Gupta, ( not sure I get it correctly ), I think he can shame many FA wannabes with his analysis of macro themes. He just didn't box himself in semantics. Doing charts doesn't mean u are TA purist. 

Most things come with 2 sides. Pick a side to start, not to stay. I guess is sound advice. 

Thursday, September 23, 2021

随心笔:烦

 烦是因为躲避。

不躲了,也烦。

累了,病了。

要的是关心,不是唠叨。

忙,是心甘情愿,要的只是珍惜。

累,可以适应,不能接受的是被当成理所当然。

关心的到底是别人,还是自己。

一步一步,慢慢走下去。


好的,好好享受,

不好的,让它来,也让它走。

Thursday, September 9, 2021

随心笔:回忆

缘分带来了,惜福。

走了,留在回忆。

回忆是美丽的。

愿意和现实交错,

故地重游,找到初心,

然后就离开。

现实也是回忆。

时间罢了。

珍惜现在,活在当下,尽量过得精彩。

不要去渴望未来,

该来的,在于现在做了什么。

回忆,要在与现在做了什么。


不奢望回忆再出现在眼前,

让你在过那段日子。

就算时间能倒转,

你也不是当初的你了。


潇洒地留在心里。

毕竟感动是真的,

感恩活着。



Sunday, September 5, 2021

随心笔:教师节2021

 这几年都提笔写教师节的感受。

这几年都很伤感。

今年不同。

交了一个朋友。

思念的毕业生,好多再“出现”祝福。

很满意的教师节。

好久了。

也许,要求低了。

但是,看到学生尽力用华文写出感谢的句子。

真是句句珍贵。

谢谢,本来越来越觉得迷惘。

现在从外在找到了一些动力。

感恩。

其他辛劳的教师,也教师节快乐。

假期好好休息。

Friday, August 20, 2021

Random thoughts: Right valuation usually appear only during the wrong time

In investing, if we want to manage risk, there are a few ways.

Last week, I talk about diversification. I was referring to diversification into more counters as compared to concentrated bets. 

That is just one side to diversification. The other side is diversification across asset classes, so u are not heavily vested in just equity. Textbook theory talks about Bonds and Equity. I guess for me, my only meaningful asset class diversification is CASH. 

Today post is more about valuation.

It is a key part of FA, a great business with good fudementals must go hand in hand with a great valuation.

The ironic is, given market is effecient most of the time, u can only get great valuation at the wrong time.

2 ways IMHO, and both happens in the wrong time.

1) You get the good valuation in the future.
The company valuation seem high by today standards, but u projected the earnings for the next few years (I could only do it with confidence maximum of 1 year projection, beyond that is usually just a good guess) and see a compressed valuation.

So u dun get a good valuation NOW/ YET, u let the company grow into a good deal.

2) When bad news that do not really affect a company structurally in the medium to long term break, and sentiments are weak, u get a good valuation NOW, but u have to wait out the poor results that u expected (yet overly punished in terms of shares price) and for sentiments to normalised to get your good valuation.

Conclusion:

The company (mainly, although I could find a lot more examples) I have in mind when I write this article is Alibaba.

It is more of 2) Than 1)

Of course, regulatory risks is scary. Would they suddenly declare all platform companies should be for "non-profit", like what they did for the education and tutoring sector? 

If the tutoring sector "dies" parents still get tuition, they just can't go to the centers. If a significant number of pupils do not have tuition, it is aligned with making education more equitable.

As for platforms, they are a "livehood" for many workers. The cost for big internet companies should increase, as the central pushes for more benefits and safety net to these gig economy workers. 

While without doubts, as this trend unfolds, margin will get squeeze and some merchants might quit the platforms ( with data restriction and privacy issues, it might not be as easy to find customers ), but net net, improving the lives of gig workers is a worthy cause if u ask me. Merchants, platform owners and consumers should be able to find a compromise to share the "social cost"

Tencent, Alibaba and other big internet companies are also pushing into various strategic areas that the CCP hold dear, AI, cloud etc. Will the CCP deliberately make them weaker? I seriously doubt so. 

Of course, there are other political reasons beyond the balancing "invisible hand" and "centrally planned hand" of the economy, but to say is all about toeing the line, it is properly untrue, since Tencent is the quiet poster boy and had it equally hard. 

I did accumulate more of Alibaba when it hits the trigger rule of 25 percent drop. I am not sure how it will turn out. Guess if I fail, there are lessons to be learnt again.

Monday, August 16, 2021

Cut loss: Diary Farm 30 Percent loss.

I finally decided to part way with Diary Farm.

Maybe years down the route, they might recover, or maybe mainland visitors will start visiting and give a boast to the health care and beauty segment. Maybe YongHui loss is one off.

Well, I need not bother myself with all these anymore. 

The consolation from this experience is pays off to diversify, at least for a silly investor like me. 

The loss of Diary Farm hardly make a dent to the overall portfolio, since DFI is less than 5% of my portfolio, am  mindfully restricted any investment at cost to below the ceiling of 5% of total portfolio value. DFI is already close to 5%, I have many counters in the range to 2-4%. 

The reverse is true too, if a few counters gain more than 30%, it also hardly move the portfolio. 

I need most of the counters to concurrently run to make any meaningful gain. 

I must admits the easy money period is over. Time to just sit back and enjoy the dividends. 

Having some cash release, might not be a bad idea too. 

I know concentration bets is  the rogue in recent years.  I do allow 1 counter to go above 5% if it is a highly conviction stock, but never will I allow it to breach 10%.

That is my own rule. No figures for comparison, but I am happy with the returns thus far, especially if I can sleep well, and it is not difficult to cut, as and when required.


Saturday, August 14, 2021

Company prospecting: Olam

Just sharing some of my thoughts here.

Olam is a food commodity trader, processor, producer and distributor. There are a few pieces of good news that I thought but Olam shares are trading a recent low. (Post rights theoretical price should be around $1.6) 


Yet, they recently announced record earning and has firmed plans for demerger of OFI to primary list in LSE and secondary listing in SGX. 

Given commodity prices has a good run, and with 1H earning of 11 cents, even if they only 4 cents in 2H (Which is highly unlikely given the elevated food prices, as well as worries over supply disruptions and inflation etc), Olam will be in the PE range of 10. 

Olam also increase dividends in 1H, signaling the confidence of management. 


In terms of valuations, this is the first time in a decade that you will have a chance to get a "discount" in terms of PE of 10 (Lowest), and with PS and PB below 0.15 and 1 respectively. (Barring big writedown of assets due to big swing down of commodity prices.)

If earnings is good, expanding, and there is no obvious dark clouds in the horizon, why such low valuation?

Next, when Capitaland announce it's restructuring, everyone cheers!

When Olam announce it's restructuring, people cheers then start dumping? 

Next, is commodity super cycle coming?

Since June 2020 the price of food is on a tear, 




Even the high prices continue, it is a bonus, if it doesn't, I hardly think with the restructuring going on, the new IPOs will command a valuation that is lower than the 3 metrics I mentioned earlier.

So in conclusion, I think Olam is underappreciated by the market now.  








 

Friday, August 13, 2021

Random inner demons

In just a few weeks, it will be Teacher's Day.

Truth to be told, it is one of the days I dread.

When I see some of my colleagues showered with gifts and I have less. When I see long messages filled with thanks and gratitude but couldn't find mine.

When I see my pupils showing appreciation to others but not me.

I feel pretty lousy and sad

Laugh all u want. This is a random inner demon post, what do u expect. 

Perhaps it is a time of self-reflection. But truth to be told, the self-reflection already started years ago. I do not think I have not tried my best for pupils under my charge, and I believe that I  have cared for them holistically, beyond their grades. 

It is a inner demon and well, one I could live with. Having dread a day but being happy for most of the year is still a good deal.

The PSLE oral examination is finally over. I used to grab hold of pupils along the corridor and do 1 to 1 practice with them. Listen to audio recordings one after another, having zoom sessions to practice with the weaker pupils. 

When I am doing it, I can't wait for it to be over. It is tiring, a 3 minutes recording takes more than 5 minutes to return and track for corrections(another 5 minutes) and u multiple that by 30, it is hours and hours of focused "marking" a few times a week. 

However, it is also during this period I build bonds with the children and our conversation sometimes goes beyond the curriculum and they start to ask questions and share problems. Maybe they feel comfortable and safer in those 1 to 1 session and many a times, I get to know them as a person, understand the challenges they are facing at home.

Children are indeed a marvel. Some of them could be having a difficult time at home, and yet when they laugh and smile, u would think that everything is fine. I am not quite sure I could be as "happy" in their shoes, maybe a trait of child is "forgetful" and it works both way.

Sorry, I digress. 

In my past years, given how much hard work I put in to prepare them for their PSLE, I always appreciate it when my pupils update me how they feel about their exams.

It could be a "yes! I did it", "Cher ! We practice that before!" Or "老师,我很紧张,我觉得我考不好!” it doesn't matter, but I just like to hear from them. 

Usually, quite a handful will give me a update voluntarily and I feel appreciated that I am one of the first thing in their mind when their exam is over. 

This year, none gave me a update.

I guess I have been too pampered in the last few years and I reminded myself it is my job to teach, and their jobs to learn. Professional and transactional. Full stop. 

I wonder if I will post this and will this be a draft? 

Thursday, August 12, 2021

Quick Updates on portfolio and follow up actions

Most if not all, Singapore companies under my portfolio has report their results. In general, I expect better results or at least stable results for most companies, except Koufu due to heightened alert phase that prohibit dining in. 

So there are 3 categories of companies. Below expectations, which should be followed by a stop loss limit imposed, and a sell action when price stabilizes. Within Expectations means earnings are stable, or growing as expected. Hold, will suffice. Above expectations, look for opportunities to add when market pull back.

Pretty much most of the companies are in Cat 2

Cat 1   

Diary Farm. 
Multiple disappointments in various fronts. The reasons behind buying is the groceries business will turnaround, and the pandemic will make the business even more resilience or even sticky. When the reopening the starts, the healthcare and beauty segment will then pick up the pace of recovery, and it will be firing at both cylinders.

To be fair, the groceries business turnaround is still intact, and I accept the reasoning that the panic buying create a high base for YOY comparison (Is the same for Sheng Siong). However, Yong Hui swing to loss is not properly explained. It could be something structural about this associate. I mean goods can be flying off the shelves less quickly, but how did you swing to a loss?

I also wonder aloud if HK beauty and Healthcare business is ever going to recover. It is one to the major contributor to bottom line although it is light on the topline. I wonder when will mainland tourists flock to HK again, and even if they did, are they welcomed such that they would want to come back

Numbers wise, they did the nuclear option of cutting the dividends AGAIN, and the double whammy is the cut dividends of 3 cents is still lesser than net profits. 

CSE
Order book is on a downtrend. Topline and bottom line too. Oil price recovery did not lead to more contract wins, although they made some improvements in the infrastructure.

I believe there is a lag time between actual oil price and commitment to CapeX. But with Biden trying giving mix signals on his renewable energy agenda (promising to spend big and go big in renewable, and yet asking OPEC to increase production), the future of "brown" energy is questionable in the longer run. I wonder if the tide will come that will lift a subcontractor like CSE.

Cat 3.
 
Hotung
Hotung already has a record earning year last year, riding on the technology rally wave. So 1H results is already almost equals to 2019 earnings.

Hotung yield is above 10% based on dividends given out last year. It is likely that Hotung will do as well or better (if 2H is as good as 1H).

Even if Hotung sustainable earnings is that 2019 earnings (which is the lowest in the last 5 years), the yield is still above 5%. Hotung investments in Tech and the home ground advantage in Taiwan which is experiencing a tech industry resurgent, puts it in a sweet spot for 2021.

Kayhian 
Similar to Hotung, this company could continue its good performance into 2021 despite the high base. And the reason why it is in Cat 3, is the odds of increased dividends payout. 

HOtung gave most of its earnings back as dividends, 2020 is the year where they gave less than 90%. Kayhian gave 50% of NP.

Given Singapore is a major market for commission income, tracking the SGX announcement on trade velocity and volume is a easy to "project" Kayhian future earnings. 1H turns out well as expected. 

Cat 2 companies are mostly hold companies. which I shall not labor.

I will do a HK review after their earning session is over.     

Monday, August 2, 2021

随心笔:老师的舞台

老师就像个演员、歌手。

他在演艺界,表演给观众看。

舞台上,有些也会犹豫、紧张。

渴望着观众的掌声,

让观众的鼓励给自己动力,

让自己做得更好。

有些演绎小丑,有些是文人,

那些年轻颜值高,多少有些优势吧。


上了舞蹈,就想忘了台下的疲惫。

观众们,舞蹈上的我,也希望你们的支持。


渐渐地,舞台越来越大。

已经不记得自己的观众是谁了。

最喜爱还是天真无邪的笑容。


什么时候,参加了竞赛。

舞台下的观众都是评审。


什么时候,演得自己都不知道在演什么?

什么时候,评审的嘉许或批评也不怎么放在心上。


我就希望有个小舞台,

让我尽情地唱歌。

唱我喜欢的爱的歌,

唱着你的悲伤,我的无奈。


舞蹈上的表演,

越来越不由己。

最可笑的,

都说是为了观众,

却不给我机会和观众拉近距离。


散席了,还在彩排。

不能独奏,说什么合唱、团体表演比较吃香。

我知道,观众的掌声,是肯定。

观众的嫌弃,是改进的机会。


让我在表演中学习,然后认真地彩排。

我是表演者。

我不是策划人。


不要问我舞台怎么设计,

不要问我销售量,

不要、不要。

不要问我哪个市场。


让我尽情地表演。

没人喜欢我的时候,

我会悄悄离开。


不知道哪一天是最后的表演。

每天带着感恩,与疲惫,

表演。

唱你的无助,我的虚伪。

演你的渴望,笑我的疲倦。

Saturday, July 31, 2021

Tianneng Power International (0819): A different Tech Giant In the making in China?

First, this is the first time I personally experienced a stock that jumped 15% in a day, barring privatization offer.  


The more well-love subsidiary, TianNeng Battery listed in SSE STAR jumped 20%. Company will likely announce 1H results over the next few days. 


There has been "no news" or updates, since their last quarter results. But they have launch new product series of batteries, C, P and S, classic, premium and Selection. (http://www.cn-tn.com/news/article_1824.html), well attended by industry leaders. Also, either I have missed it earlier, I now saw an global website in English, https://www.tiannengglobal.com/coming-soon.html which I thought is sleek. 

This post is like a pre-results Q and A session, so that I can zoom straight into the results to see if my thesis on the company is correct.

1) How is their lithium batteries production getting along?

2) Beyond their market leader position in light electric vehicles and mobiles, are they able to finally able to also capture a slice of the EV market?


3) Is their high double digit earning growth going to continue? 

4) Power storage solution is a Hugh market, with China, pledging to be carbon neutral in 2060, and continuous investment into renewable energy, the power transmission market will be significant market slice to be captured, that will allow the company to continue to grow.   

(Their batteries have a wide range of product applications)


If answers turn up positive for most of these questions, will the market finally rerate this company with a PE of about 5, as compared to CATL with PE of 184!!

Perhaps they are of different leagues. But the next few days will be interesting. 


 


Saturday, July 24, 2021

Random thoughts: A passive investment journey

Looking back, I am already in my "prime" 40s. For the underachievers in their FI journey, like me, looking back in my 20 odd years of working life, could life be different, due to choices we made. U bet? But I had no regrets. 

1) Late 20s Starting work

I married young. When I started work for 2 years, I got.married. I bought resale flat because I didn't want to wait for a unit. I got a car before 30. We gotten a baby just when I turned 30.  

Expenses were high. Savings were low to nothing. about 20 percent of my income went to my parents allowance. 

I got have give the car a miss, wait for BTO, but again, I am glad I provided convenience and comfort to my familiy. Yes, there were some quarrels over money, but those were short, and after we are aware of various concerns, we become more understanding of each other.

Investment is rather useless in terms of absolute sum, but it is still a good learning experience. Those were the years I bought a lot of S chips thinking they are dirt cheap.

30s prime of my career. 
My career was quite smooth sailing. My promotion came reasonably fast. I climb the ladder and my pay increase. As my child grow older, expenses went down. Before they go P1, childcare services is like Uni education.

The shock came when I realised how ill prepared I was dealing with my parents caregiving cost. 

I remember surrendering a policy to raise cash. All went well. But I remembered losing sleep over money, as the cost of respite nurse alone can add up to thousands in a month. 

This is also the age when your peers upgrade to private property or gotten their 2nd property investment. 

On hindsight, borrowing heavily then is the right thing to do, interest is dirt cheap and property price raise more than offset it. I didn't have the balls to do it, and I still don't. I know if one of the direction ( price increase) or ( interest increase ) move against me, I might be in trouble. I also wanted buffer to care for my aged parents then.

There were again some disagreemts during this period of time. 

Recent years.
My wife and I see eye to eye more often. Maybe because she finally experince first hand how good it is to be without burden of property. When she is feeling distressed in work. I said, quit. Rest and find something else to do. 我养你。we are not hard up for money.

Can we have done things differently? U bet. Maybe I can do some freelance to earn more, to pay for that second property ? 

Maybe we can cut down on all those dinning out. I might then be within striking distance of FI in another 10 years perhaps ?

But I bear no I'll feelings. It my choice there and then. At least, I feed my family and is of no burden to others. (Yet?)

The investment journey, however, is really a worthy one to make. Although without size, it is a joke. 

But, I see the world in another perspective from business owners. It is fun, when u go shopping like scuttbutting. Also it is good zen training. How u control fear of missing out and question whether u are fearful or greedy? 
U become cynical, in a good way, and also I know quite a few bloggers that turn out to be good friends. (Although we might not meet up often or at all)

It made u appreciate the impermanence of life, since market goes in cycles and whipsaws and profits and loss change everyday.

It made me, readily accept a good deal, without having to satisfied myself that it is the best deal. (u can't buy at market bottom and sell at top)

So, whatever the outcome, whatever the circumstances, keep moving. 

Friday, July 23, 2021

Random thoughts: FIRE

Financial Independence was a goal or rather dream I had when I was in the 20s.

Today, I just had this silly thought. I am not too sure if I can have a reasonable retirement, and I do hope to work as long as possible. However, I realize the working as long as possible didn't really turn me off. 

After I took a back seat in my career, I do have more time during the school holidays. Even we could not travel, and have quite a long period of time of doing "Nothing". Reading newspaper, researching on companies, exercising etc. 

Things I hope I can spend more time on when I "semi-retired". Yet, truth to be done, it is only enjoyable for the first few days, when I recuperated. Thereafter, I am actually yearning to go back to work, and felt that I am kind of wasting my time. 

It then suddenly dawns on me, how lucky I am, and also how thankful I should be. 

I enjoy my work, and need not retire early to start doing something I enjoy. 

What I do not have is just financial independence. 

This is a wonderful job, a job that lets me connect and also learn to let go. This morning, as I sips my coffee, I reminded myself that I should just do my best, and enjoy my time as much as possible with my pupils. They will leave me in a few months, and I should make full use of my time with them. This desire to make full use of time NOW, is how I always think of my time with my dad. Before he became so weak, and was down with dementia, I tried to spend my time with him, bring him out, and have dinner. It wasn't always wonderful time, but looking back, I have few regrets now, that he passed on.

Every year, I send off the graduating class. I usually bond quite well with a number of them, and funny and clinch it might sound, closer to the end of the year, I do suffer some mild "separation anxiety"

Connecting and then letting go. I considered as Zen Training too. Every year, a few of them becomes more than just pupils to teach, but sweet memories and "friends"

Getting a pay doing all these is just really striking lottery every working day. 

Saturday, July 17, 2021

Random thoughts: Worth it?

 It has been 2 years since a pupil I taught graduated. 

Recently, I whatsapp her mum to wish her happy birthday. 




I am really happy that something that I scrabble in a rush is kept for so long (2 years). I shall remind myself that that should not be something I expect, as everyone is different, some are more appreciative, some are more transactional, but nonetheless, to try to do my best for everyone, regardless of returns, and hopefully, I impact more the positive ways than negative. 

I shall remind myself that, building that relationship and trust, is perhaps the one thing that is toughest, most distracting and yet indispensable. 



Friday, July 9, 2021

Random thoughts: Favorite Character in Pokemon

Just had a conversation with my son and niece as we watch pokemon. 

I told them my favorite character is actually Team Rocket. I am not too sure if you catch the series in Netflix, but Team Rocket is really a talented Duo.

They are great cook, engineer business owner, poets and masters of disguise. 

They run a super successful masala stall, cook for school children and never failed to build a new innovative robot to catch Pikachu. Mind you, these are robots that can swim in sea, go under water, soar in sky. They even managed to build a robot that prepare wonderful deserts (In Sun and Moon Series)

Best of all, their resilience put Liu Bei in romance of 3 kingdoms to shame. They failed and get "blasted away" in almost EVERY episode, and never really had their "day". Yet come to the crux of major disaster/s, they always chip in their way, albeit insignificant, to help the main characters "Ash" prevent doomsday. 

 In fact, I wonder if they are moles planted in Team Rocket organization. LOL. 

If ever, I could interview an character, I would interview them, instead of ASH. 


Tip

Wednesday, June 30, 2021

随心笔: 应该不应该

生活应该幸福?
你想着“应该”,可能幸福就会远一点。
我们在“应该”的背后,要加一个“做”,
把精力放在应该做的事,
不去问应该发生的结果。

没有人应该得到幸福,
能做应该做的事,
就是幸福。


Saturday, June 26, 2021

Random thoughts: Still betting on recovery?

 STI is near 3200. It is at or near pre-covid levels. My initial gameplay is to start to offload some counters to increase cash holding as STI goes 3200. I did not. 

Whenever I made a sale, I would have redeployed funds back rather quickly. I struggled with an inner voice that is shouting "greed is creeping in", and cognitive dissonance that claimed there is still much to recovery.

1)  STI recovery is lead by banks

A quick look at my companies under my radar, only the banks and YZJ are back to pre-covid level (in terms of price), many counters are still at 5 years low. 





If you are thinking of "reversion to mean" as a way to play the recovery theme, I would think there are still meat out there. 

Of course, each and every company has a different story, but CDG and CDL are both contemplating a sale of assets (Australia assets or in the case of CDL, injection to a reit), in normal time, these should act as a catalyst of sort for short term price gain. 

2)  The worst is over and yet no reflected in the share price.

CDL has fully impaired the investment on Sincere, Europe is opening up (Think Euro 2020), while CDL has plenty of issues and problems, I would think it would have put his worst behind it.

I am not talking about Covid, but China Tech companies. Alibaba in particular. Yes, ANT will no longer command an lofty valuation if ANT does a future IPO (a BIG IF), but the impact on Alibaba earnings is small, as ANT contribution to alibaba core commerce in low. 

The fine on monopolistic practices is more of a closure than a harbinger of worse to come. If there is no exclusive clause for vendors and suppliers to be locked into a platform, how big will the damage be? I seriously do not see an exodus of merchants, since suppliers will be mindful of potential loss of customers. However, as an insurance, I also bought into JD, so together, there could be no hiding place if a supplier would like to participate in the e-marketplace.

Yes, margin for Alibaba e-commerce business is falling, and China e-commercial penetration might be at saturated point. There are the international wing (SEA penetration rate is nowhere near China), and the whether Cloud business can continue to stay profitability and grow it will be a key factor to watch. 


3) Restructuring to capture the new economy. 

How successfully companies captured new growth opportunities will determine how the market will start to rerate this companies as "growth" companies. There are plenty of examples, MIT increasing the percentage of data centers as a part of its portfolio, Olam, demerger followed by new IPO, Capitaland transformation into a lodging and fund manager, Tianneng Power increasing focus on New Energy Batteries for PowerPlant Storage and EV. 

Most of the above mentioned counters have price well below their 52 weeks high. Tianneng Power is growing in double digits for a few years now, with earning visibility still good, yet it is commanding only a PE of 5. Its PE will compressed further if growth continues to materialize. I believe the company has the ability to increase dividends and put the shadow of the short selling report behind it, sooner than later. 

Conclusion  

I feel there are still opportunities abound for companies. However, market risk has increased for me, since I am almost fully vested with cash only at 10%, although I won't be losing too much sleep over individual company hit or misses since I am a proponent for diversification.

Disclosure: I have a position on the all the mentioned companies in my post except for CDL, yet. 

 

Sunday, June 13, 2021

Random thoughts: tang ping (躺平)

 

Source: Image from Yahoo news

Read about this "silent protest" against the mad rat race or/and harsh working conditions(996) in China. It definitely resonates with me. 

My few thoughts:

1) It is definitely not about laziness, but helplessness. If someone is just plain lazy, it is very unlikely to become a rallying call. So much so that censorship happens. 

2) When we all started, most of us, would have dreams, ambitions and would like to try to climb the ladder, win the rat race. If we are starting businesses, I guess the dreams are even bigger, such as changing the world, making an impact on other lives.

There are others, who did not want a race at the very beginning, and opted to walk their own path. I believed these people will not bother to even write about “Tang Ping" or join the "protest"/ Movement.

These are people are not lying down, they are walking a different path. "Tang Ping" as the word suggests, is a protest or call out for help. Much like a tired child asking for parents to carry them when they are tired.

3) Before we pass any judgements that these people are "pampered" or "sore losers", I do think, most of us, and especially myself, "tang ping" at different points of time. 

Tang Ping @ Investing

I remembered just perhaps years ago, I really would like to blog about a sizeable portfolio, and given how many bloggers who are much younger already had bigger portfolios, it is easy to feel disappointed or inferior. Truth to be told, although such thoughts are few and between and never as intense, it does still popped out now and then.

Tang Ping @Work

It is just in recent years, that I decided to walk in the rat race. I am still in the race, but walking instead of running, does give me more energy. I have tried my best to run in the last decade (I did more than 996 for a few years too) and did manage to get ahead.

But after a while, I realize I not interested in running ahead anymore. Hence, I am sort of also "tang ping"ING. 

Tang Ping @Social life

I really do not feel like meeting friends, relatives and the sort. I know about balance of life and etc, but truth to be told, while I enjoy having a quick chat with my friends, f2f or online, I really did not like to visit or do any meals. Don't ask me why, maybe I am a hermit. CB or heightened phase 2, really has no impact on me, I kind of enjoy it, reading and sleeping. Tang Ping again

Conclusion:

I hope all those who are reading this, you never feel the urge to "tang xia", but if you do, I hope you take it as a rest, but stand up soon enough. You might decide that you do not wish to run, and would like to take a walk instead. You might start seeing people whom you overtaken earlier, overtaking you, but keep walking, until you are ready to run again. 

You might also decided that you had enough of that race, and decide to disqualified yourself and walk off without reaching the end. Find a meaningful journey, and walk, run, play along the way. If you find companions, good, if not, I hope you find solace in the journey alone. 

I think I didn't Tang Ping for too long in my life. Sometimes, some "gui ren" gave me a hand, and pull me up. Sometimes, I just can't stand the stepping on by others as I lie down, and hence I just got up. 

There are also occasions, where like a little child, hoping to hitch a hug and "ride", I protest by "tang ping".

Its Ok to be not to OK all the times.

Its not Ok to be not OK all the times. 

  

Friday, June 4, 2021

Random thoughts: I no longer feel happy being kind...

 Hi all,

My sister alerted me to a facebook group page known as "blessing for those in need". 

She told me many people posted things that are still useable, and anyone can ask to collect these items for free. Some kind souls also offer to transport the goods at cost price. 

I was invited by my sister to join the group. Recently, as we are doing some spring cleaning, I decided to try posting some items, such as jucier, vaccum flask etc. When happened over the next 2 days triggered a lot of thoughts, and I hope to organize them by writing a post. 

When I first posted the items, I am quite surprised that within 1 hour of approval by Admin, someone did want to collect the items. I thought to myself "Great, things will not go to waste, and someone get help" The lady ask for my contact and arranged for Courier to pick my stuff. My thoughts that surfaced (I am cynical person) "Why is a person who is so efficient and resourceful in getting a courier (I didn't know Q express provide such CtoC service) asking for free item? Is she trying to resell the items? Isn't there a cost involved if courier service is purchased?" Nonetheless, I felt that even if she do resell the items, it is to her resourcefulness, and I still fulfilled my goal of reducing wastage. (Doesn't matter that when you first joined the group, one of the rules is no reselling of the items). 

When I was posting another batch of items to be collected, I look through what are the items that are available for collection. I am quite surprised to find TV, furniture given away. On the other end of the spectrum, there are very cheap items such as a stuff toy and clothes hangers to be given out too.

I was looking at one post, where a lady is trying to help a friend give away old furniture. Another person claimed to be interested, but unable to pay for transport. I then offer to sponsor the transport and ask the owner if she could arrange. The lady insisted that I settled the transportation on my own, and hence I went about coordinating between the two. It is through this coordinating that I learnt about gogoX and LalaMove, and how transport cost has dropped. 

I did not have a good experience, as I realized the person asking for furniture also start to ask for food, and mentioned several times her plight. I did some fact finding, and found out that she is real, and is helped by GiveAsia before. The sum raised is small. 

When I left a comment on the post, saying that I am willing to pick up the tab for the person on the transport, to get her the coffee table that she wanted, another commenter who is queuing for the same item earlier, bring forward the possible date of collection. I felt quite uncomfortable about "fighting over" item. 

I told the person wanting the furniture that I can cancel the request for the furniture and use the transportation costs to buy groceries for her, if that is "really what she needed" (her own words) She then told me she really wanted the furniture instead, and she could ask her cousin for food instead.

I am not sure about the whole experience. 

How much help is enough, and how to make sure the help goes to the deserving. 

For someone in need of long term help, constantly trying to get help. is it still dignified. I am not passing any judgement here. Just penning my many thoughts that are swirling around my head.

Deep inside me, the feelings of satisfaction and joy whenever I help someone in the past, is missing this time round. Of course, I am mindful my "help" is of little or no significance. 

Just feeling weird that I might have pass the age, where I feel happy, doing a others a small favor. Maybe it is because I realized I might not really make a difference. 


Wednesday, May 26, 2021

Random thoughts: BT article on "5 investment pitfalls"

 I read an BT article on 5 investment pitfalls. I thought I blog about it to crystallize my thoughts. I hope I will be able to illustrate the various points made by the author with my own examples.

"If something is too good to be true, it probably is" 

I wonder what is considered "too good to be true"? Dividends yield of more than 10%? I remember I used to own APTT, LMRT, Sabana Reit and even SPH at $3.6. Most of them have yield around 10%. except SPH.

Even suspended Qingmei gave an yield of 15% for me, once. 

I think there is big difference here between trailing yield and future yield. Looking back, buying counters with trailing yield of around 10% or more usually does more harm than good to my portfolio. There are indeed years where I harvest the above 10% yield, but it is not sustainable. 

LMRT issues dilutive rights (present tense is not a grammatical error), Qingmei is a fraud, APTT could not sustained the payout. I was receiving about 11% yield from APPT and lucky for me, I got out of this counter before any damage. However,  I wasn't so lucky all the time, and I suffered capital loss in excess of dividends received.

I do currently own counters of yield about 10%, like Hotung, Lung Kee,  MIT. They grow into it, when I first bought them, they yield 6-7%, and it is during market correction that throws out such yield, before that, the yield is even lower. 

In the area of growers, I get very excited when I find a company that grows around 20-30% in both their topline and bottom line for the last 5 years, and yet trading at less than 15 times PE. I am a novice in "grower" criteria and I do not own a single Tech Stock in my portfolio. Hence, I find it hard to come up with hits and misses. I bought into CSCP believing in their pipeline of drugs (More being developed over the years), and Raffles Medical Expansion into China. I have no track records for both yet, so I will reserve judgements.  

"Turnarounds seldom occur" 

My investment school of thought is influenced by Peter Lynch Turnarounds and Cyclical Plays. So, trying to buy a counter when it is out of favor is indeed something I do very often. 

I remembered SIA Engineering, YZJ, Sembcorp Industries, QAF, Singtel, SingPost, Golden Agri and SPH, Pan United are all purchases based on cyclical upturn analysis.

I have both hits and misses. 

Those that faced disruptive forces are counters didn't turn out well. SingPost, new growth area is e-commerce and SPH's property, both companies did not fare well. Both counters are in the red. I deliberately left out Sembmarine but bought into SCI. Nonetheless, I believed SCI will turnaround together with SCM. It is with a stroke of luck that SCM is demerged. I am betting actually on SCI doing infrastructure trusts like Keppel, but it turns out better than I expected. When they are demerged, I sold SCM.

The lesson here is clear, it is difficult to turn ship with a heavy load (baggage). It is easier for companies to outlast an oversupply situation or unfavorable market conditions, than overcome structural disruption. For example, with ESG becoming a corporate culture in boardrooms, I think fossil industry will likely face structural decline in the future.  I think I will swear off fossils plays. (Although I did own SInopec, but China is a different story)  

The next lesson here is management's alignment to shareholders' interest. LMRT is frequently doing highly dilutive rights and buying assets of questionable quality. Sabana bought a 50% occupied high tech building and has problem filling it up. and management Incompetence aggravated the problem. First Reit has the same owner as LMRT, and they also did a dilutive rights issue, but I see management competence the biggest difference between FR and LMRT. Sabana seem to be faring better now after Kelvin, its ex-CEO left.

QAF has a suffering pork business in Australia, Rivea (I hope I get the name right), it dragged the earnings down. I bought it as I believed that is a cyclical business and the high cost of feeds is due to weather factors that might not be recurring. True enough, the business did better, again (It is not the first time it happens, QAF has been trying to sell the poultry business twice without success). QAF is one of my better performing counter in SGX yielding 7% with capital gains. 

Another factor to look at is profitability in the face of downturn. Yes, profits will fall, but keeping company profitability means the chance of permanent capital loss is low. YZJ is the star that comes to mind, having navigating the downturn well with its sideline of HTM business. It is not easy to get a good yield from YZJ and it is difficult to quantified the risk of it HTM business. Nonetheless, I believed these are accounted for in it valuation in terms of PB as compared to industry peers.



Source: DBS research

I also fare better with companies with information on industrial indicators aplenty. For example, in the analysis of Pan United, the price of RMC and construction demand figures are easily available in URA website, this makes modeling of earnings possible. And in the case of YZJ, freight rates, bulk rates, newbuild numbers,  are also easily available in numerous websites.  Even with these information, I am mindful it is still very much a guessing game. So I practiced diversification in investing.

So how do we know if a company competitive strength is intact. In the case of APTT, the last 8 quarters show a consistent fall in basic cable TV subscribers and while premium digital TV subscribers are increasing, the ARPU is falling. It shows a lack of pricing power with the industry. The broadband segment is touted by analysts as a growth area due to 5G rollout. However, ARPU is also falling and the EBITA is not growing. Taiwan at the verge of a possible lockdown, and I assume its premium TV might be do very well in such circumstances, but after looking at it numbers, it did not instill confidence. 

Hence, I believe the better days of turnaround are far from near, although it is worth monitoring.

Selling a winner too early

Well, Venture comes to mind. What would have been a possibly 3 baggers became a 30% gain. For context, I bought Venture at average price of $8, and sold it off at $11

I have also seen Lee metals (Now bought over and merged with BRC Asia)  50% gains evaporated in front of my very own eyes when I didn't sell. 

Lee metals earnings get a bump up due to its opportunistic and profitable EC venture. Given that is is non-recurring, I should have sold when the earnings improved as I expected it. The catalyst is non-recurring and I could not understand why I not sell then.

Cogent, which is privatized by Cosco, is another example. It is another 3 baggers. I didn't believe the rumors of an offer. I bought it at 28 cents, and the offer came 2 years later, iirc at 80 cents.

I think if the operating numbers did not deteriorate too much, it might be wise not to sell too early, unless it is OVER-valued compared to fairly valued. Since if the competitive strength is intact, it should continue to grow or recovers from the down cycle. 

I am consistently tempted to sell some of profitable counters, but I now reminded myself to sell only if operating numbers show loss of competitive edge over a few quarters. 

Buying into false promises

Silverlake Axis comes to mind. Granted, the false promises comes from both management and the delusional myself. I correctly predicted an upturn of earnings as the big projects scored by company seem to be underappreciate by the public and how usually IT system get obsolete after 4- 5 years. I predicted and upturn should come sooner than later. correctly in 2019.

I did make some good money earlier on, buying at 40 cents and selling at 55 cents. But I bought more than I sold, and I average down at 30cent at 24 cents. My thoughts is business will improve after Malaysia MCO is over, and the big projects win will continue. Yet, it is long wait without improvement

I am actually willing to wait it out, given that no one could predicted COVID-19. The red flag is the suspension of dividends. The used to give out dividends in 3 quarters, and while they promised during AGM Q and A that they understand dividends payout is important to investors, they skip an quarter of dividends and blame it Half-Yearly reporting. When is 1H reporting, they have the cheek to skip it again and declare that they will only give year end dividend.

So, I said "GoodBye" to the counter. Doesn't matter if they do better again. if I cannot understand a management or trust it to be aligned to shareholders, then it is a sell. 

Conclusion

If you have reading until here. Thank you. My mind is slightly clearer, I hope you are not too confused. I welcome your thoughts.

Monday, May 24, 2021

Company Prospecting: China Resources Cement 1313

 I did another round of screening for dividend stock for both SGX and HKEX recently.

The criteria I selected are:

1) PE less than 10

2) ROE >20

2) ROIC >15

3) ROA >10

4) Net margin >10

5) Quick and Current Ratio >1

6) Debt to equity < 0.3

7) Dividend yield > 4%

Of the close to 40 counters that appeared, only 3 came from SGX. (Which is quite sad)

After that, I went on to check for consistency or improving trend of the above mentioned metrics, companies that do not give out dividends regularly, or have earnings that are doing a yo-yo are eliminated. I do allow earnings to drop in 2020, given it is a covid here. 

About 3 or 4 counters are left. 

China Resources cement is the only one that made me pulled the trigger today. First, some numbers 






Source of data are from FSM Screener.

The numbers look great for a 7.5% forward yield company, isn't it, with payout ration of less than 50%, and FCF yield of above 10% if you take the 5 years average. 2020 and 2021 Capex is high at 5 billion HKD, company already guided for 2022 Capex of 2 billion which is more like the norm.

Going forward, Q1 results is good, EPS grow 15$ YOY.  (https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0423/2021042300455.pdf)

It is my speculation, that post Covid, China will spend more on infrastructure, and this is the thesis, that lead me to buy into Lonking, which has pans out well so far. 




 Due to the low base effect of Q1 Covid on China, the numbers show a big jump, while margin is lower.

By QoQ the pace of expansion (Turnover)/ and profitability has decreased, margin has fallen too. 

It is highly likely the reason why the company is trading at such low valuation, as people are betting 2021 will be worse than 2020, and this is indeed a risk.

Overall:
Given the track records of the company, and the emerging theme of "Going Green" and "Going high Tech", “IOT" of the New Economy, I believe any reduction in infrastructure in a bump on the road rather than any structurally decline. 

Hence it is a risk I would take. 



Wednesday, May 12, 2021

Company prospecting: Tianneng Power 0819

 TianNeng Power is a company that I recently accumulated due to price weakness. It is the only company nearing the Threshold of 5% of my Portfolio now, and is particularly rare, as it is a Hong Kong Counter, but I find it too attractive to ignore. 

First, a few pictures.




Number wise, earning is improving over the last 5 years, FCF is stable over the last 5 years, debt is stable or reducing over the last 3 years. In fact, if you look at the latest Q1 results of TianNeng Battery listed in STAR, which is a subsidiary but form 80-90% of its earning, it is again an impressive Q1 of more than 40% growth. 

Valuation use, PE trailing is 5X, if you expect the earning growth to continue, it will be even lower than this. Dividends is low but decent, 3% with about 20% payout (Hardly punishing.) FCF yield is so-so, in the 7-8% range, but not too shabby, given ROE is 32%. Debt is low, with debt to equity at 0.19. 

Valuation of Tianneng Battery is double or triple of what it is doing in HKEX, which does not make a lot of sense to me. 

So the number part is pretty impressive. 

So the story part? 

It is even more puzzling that TianNeng is flying under the radar. In the years where ESG and EV are all the rage, it is very puzzling than Tian Neng is so grossly neglected by investors. 

Granted its battery is used mainly for light electric vehicle, bicycles etc, which is lead-battery powered, but Tianneng has moved into Lithium-ion Battery business and also in Oct 2020, supplied storage battery for a Power Plant. Both sector has the hottest theme and story of ESG. Granted competition is going to be stiff, but the pie is growing, and its low valuation should provide the buffer. 

The lead battery market is Hugh, and battery need replacement every 0.5 years to 3 years. It is the market leader in these area. 

China is promising to be a carbon peak country at 2030, and neutral at 2060. EVs and renewables are 2 ways which there are moving towards. Tianneng is going to have a bite at both pies, and is not like the core business of lead battery is being disrupted as they pursuit growth. 

They have been growing at 30-40% for that last few years, and for such a grower, you get PE at 5 times?

Yes, it has almost double from its 52 weeks low, this is the only explanation I can find, where traders rotate out of it. However, I find value and is willing to get 3% yield as I wait for capital gain as well as dividend growth. 

It will be a matter of time market rerate this counter if it continues its growth. 

Monday, May 10, 2021

Random thoughts: My son taking PSLE this year

 This year is the year my son is taking PSLE. Many thoughts keep swirling in my head, and thought I just pen down my thoughts, incoherent it might be.

It is difficult for him. My wife and I have pushed him hard, and I must say his attitude has improved compared to last year, and there is more effort from him. As a primary school teacher, I knew in terms of efforts, or/ and capability, he is nowhere near the top or comparable to diligent pupils who are hungry for success. 

Yet, seeing him trying is good enough for me. (I speak only for myself)

We did discuss about a secondary school that he should aim for. I am not sure if he is really interested anyway, likely he is not interested in the school and more interested in the school where most of his friends would apply to.

It is a very surreal experience this year, teaching both my son and my pupils. I have been teaching graduating classes for many years, and this is the year where I really stop and ask myself, does a particular secondary school really matters?

I know it matters because the pupils of that school would become your child friends, you might want to stretch his capabilities by keeping him constantly challenged by other pupils equally smart or smarter. Given school tailored their programs according to the profile of the pupils, definitely different schools offer different programs. However, I am of the view, what he gets, is where he goes. If he did very well, good, and fine. If he slips, he go to a lower tier school, I am fine with it. 

What I cannot accept is not putting in effort in the pursuit of academic excellence. Stress, is inevitable in my opinion, and the pupil who got the worst end of the deal and those who do not grumble. Those who are lazy whine the most, although there are always exceptions.

I went to a notorious school. However, it was the best experience in my life. Pei Dao Secondary School used to be in Toa Payoh. The school is a powerhouse in volleyball, there is no focus in CCA, no such thing as DSA in my time, we trained hard, and that means everyday except Sunday during the holiday, and we were duly crowned the National Champions in C division. As I need to help out in my dad stall, I decided to change my CCA in secondary 3, but that experience is really invaluable.  I was made the head prefect in my school, I was a useless one at that, but I at least learn to talk to all pupils from both express and normal stream, and try to assist my teacher in whatever way I could. 

Looking back, I believed my life is shaped by many moments, and Secondary School, is really about my social view, I never have a problem of a being a snob (I hope others feel the same), I find "ah bengs" rather nice people. If you ask me, the real "gangster" during my time is so much more "gentleman" than the gangsters nowadays. I enjoy the company of anyone, as long as they are honest with me. I had more problems with guarded "successful" people. Maybe It is sour grape mentality. 

As I look at pupils in my school, and know of their "life stories" (some are pretty drama), I feel quite sorry for most of them. Are they living the dreams of others? Do they even have a dream? I didn't, but I studied for myself, and as and when as I wanted and feel like. I got 226 for PSLE. I do not feel ashamed about it, neither and I proud of it. It was what I could manage under the circumstances then.

I did volunteer work during my college days, I think that is one of those life-defining moments. Friends that I am still in contact with are friends I know when I volunteer at a hospital. I am still in contact with a few secondary school friends, but we do not meet up anymore. 

NS also did shape some of my values. 

So, my son, and my pupils. I love you regardless of your results. I hope all of you think academic excellence seriously, and overcome challenges that come in that pursuit. If life is a bed of roses, you need not study so hard. It is not for that last mark, it is to build up that reservoir of resilience. I wonder if you ever feel that the adults have ulterior motives in helping you. I really do not have any, although I do get disappointed when you do not do well. 

All the best. It is still 5 months away, but it will be over in a blink of the eye. Take care

Sunday, May 9, 2021

SPH: Told my family members to cut loss

SPH restructuring is a bad deal for shareholders, in the near to middle term.

While a demerger from Sembmarine did Sembcorp good, there are several differences. 

1) Sembcorp Industries shareholders receive Sembmarine Shares. SPH shareholders get nothing, in fact, they lose NTA value for "nothing"

2) SCI post demerger can focus on renewables, and while one can argue that SPH can now focus on property, SPH is now a property company commanding a valuation that is on par with Capitaland and don't see how it can be compared to Capitaland. In fact, UOL is trading at 0.65 book value, and smaller but established players like CES, Centurion with students accommodation business and also workers accommodation business is trading at 0.47 PB.

HongKong Land, btw trades at 0.3. 

I would agree that SPH would have a different asset portfolio but I think you get the drift. 

3) Valuation wise, we can also value a company by dividends yield. SPH used to be a dividends stalwart, I used to owned it too.  Stripping away revaluation loss, SPH earns about 150 mio for the last 2 years. Assume 30% payout, it is 2.5 to 3 cents dividends. If you think think 3% yield is fair price, then for 3 cents to give 3% yield, SPH is $1. 

Hardly compelling, unless you say SPH is going to double its earning in the next few years.

4) Operational or strategic expansion

Finally, I wouldn't really want a CEO with no control over its own emotions to be heading a company. 

To be fair, SPH faced a lot more constrains then a normal listed company, the NPPA makes selling the business to another party highly tricky if not impossible. 

But, there are profitable ones too.

https://www.investopedia.com/stock-analysis/021815/worlds-top-ten-news-companies-nws-gci-trco-nyt.aspx

The top 2 are well known and all are listed entities.

And why throw it the towel in the middle of a pandemic ? 

Friday, April 23, 2021

Random thoughts: No Free Lunch, a good deal will do.

This post is about "free lunch", kind of conincide with SMOL "nothing is free".  I find it cognitive dissonansing that people spend plenty of time searching for the best deal, when I thought a good deal should suffice. Yet the people searching for the best deal, end up spending more than usual. Below are some of the paradoxes I can't wrap my mind around. 

Buying to consume, or consuming to buy

Whenever there is a promotion in the supermarket, I know of someone who will grab it and feel very satisified that they saved some money. Yet, when I ask if they actually use this, they will also be defensive and say that they will surely be of use. So, you are "consuming" something that is cheap so that you can go on "offers" collection spree. It seems counter-intutive to me.

Even if there is no doubts that certain products will be used, are you over-consuming it, simply because there is an offer. Net net, it might seem still a good deal to some, but personally, I consume what I like, whenever I like it, I do not like to buy something to store it, because I knew I would consume it someday, and feeling obliged to consume it.

One Red flag I think consumers can ask themselves is this: Do you worried that your stuff will expired? I think if we consume in a "need or want" fashion, we hardly need to worry about Ribenna or Butter expiring isn't it? Over-consumption plus wastage is a horrible combination if you ask me.

The exception to this is something of regular consumption. For example, petrol for car, toilet paper (Everyone need to shit, right) etc. When there is an offer, you grab it and you save, is a good deal. Because there is no wastage and also no worry about feeling obliged to consume it. 

The best deal is free delivery

Whenever I hear people talk about offers, I keep hearing "delivery is free", I shall not labour on this point. SMOL has poke about this. 

Better features are worth the deal

I am someone who will pay for effeciency. In my work, I pay for several online platforms so I can create games and resources faster. I sometimes upgrade free learning software to paid versions, so that my pupils can enjoy certain features like mulitiple pages drawing, tagging, to skills etc. 

Value is questionable. Some of my colleagues might feel that there could do without those features (or some do not prepare lessons anyway), or that the valueaddness is not tangible enough. Yet, it provide tangible benefits for me, as it save time for me, and I get to deliver the lesson the way I wanted it and it gave me satiafaction. A few dollars a month, adding up to tens of dollars seem reasonable to me. 

However, after I switch to Xiaomi, I never look back at Samsung or Apple. I do know Apple has better camera and privacy protection, etc. But I realise I do not really need the best camera, and a 300 dollars Xiaomi served me just as well. Also, given that I need no extra money for a handset, I could go for SIm only plan that frankly, offers much better deal in terms of data and talktime.

Second in point is milk powder. When my son is young, I cross the border to do groceries. Money was tight in those years and I shudder when I recall those time when I was just making ends meet. I am really grateful for the time now. Anyway I digressed. 

Milk powder is 25% the price of  what Singapore is selling. Even if you take into account currency difference, it should not make so much of a difference, especially if it is the same brand

Out of curiosity. I bought another tin in singapore, and scrutiniesd every single ingredients As i expected, the Singapore version contain a formula that helps the development of "good eyesight", and hence the Malaysia version is missing 3-4 ingredients.

Yet, given there is "no choice" of purchase of cheaper version, I feel that it is a rip off of consumers in Singapore.  

Conclusion

In case, any reader think that I am trying to preach frugality, I am not. I am quite loose with money, I will be the last person in the bloggersphere that should talk about that. Frugality is a virtue, you should visit ASSI. 

In fact, I am a believer, buy what you want, what you can afford, as long as it makes you happy. If collecting offers give you joy, go ahead. We are all creatures of vices. But please, do not breach "good deal" and "savings benefits" to me. Just tell me you enjoy shopping and collecting offers, and although sometimes, you worried about storage and expiry, you can't help it. I would think you are someone honest with a high degree of self-awareness, and respect you for it. 

Now, if you turn around and think about the headers for investing.

1) Are you investing to earn, or earning to invest?
2) The best deal is free commission (Do you know the difference between custodian account or CDP account?)
3) Better products means a good business

Hope I didn't irritate you with my post LOL

Friday, April 9, 2021

Accumulated more Capitaland

There have been much written about Capitaland split into a listed CLIM, an investment manager with an lodging arm. There is an 10% discount to the "offer price" of about $4.1. I think the 10% discount is an opportunity for me, as I see value in the new CLIM entity. This 10% is not an mispriced opportunity. The deal will only be closed by the end of the year, a lot could have happen. Also, it is not an cash offer, and the value if CICT could go up or down, making the deal sweeter or more sour. Hence, the 10% discount is justified. However, I took a longer term look at what would be the value of CLIM, and I believe it is not too shabby. The proposition for this deal is that valuation should improve, as investment managing business has NAV of 2.6, and yet CLIM is valued at NAV (1). I do not think CLIM would traded anything near 2.6, at least not soon after the split without the company proving it execution records. Yet, I hardly think such a business model should trade at a discount to NAV. So the odds of losing is low. (Not to mentioned the discount of 10% should provide a bit of buffer)

Let me restate some.numbers u can find online.

Investment and management fees in 2020 is around 700 Mio.

We know management fees for reits and funds are very stable as wth the case of ARA (before delisting) records, but there might be some volality with Ascott lodging business, althought the margin for Ascott lodging managing business is better.(70bps compared to 40 bps.) ARA before it delisted is doing 45 bps.

Using NP margin of about 50 percent from fees collected. I estimate EPS of around 8.5 cent to 10 cents, so in terms of PE, CLIM is hardly attractive. ( If u think 3 dollars is attractive price post demerger and 4 dollars is good exit price)

I assume 3 billion of capital injection to improve is funds or REIT business, and the growth to 160K keys materialize ( read the edge article) on this.

Assume 0.5 percent asset acquisition fees, 15 Mio + Increase in AUM management 12 Mio + 60 mio (increase of 30 k keys management )
for easy calculation, let's just assume 90 Mio (calculation is to get a sense, nvm to be exact,imho) and 50 percent of it will become profits so is 45 Mio.

We are looking at predictable high single digit growth of Clim EPS over the next 2 years or 3.

Nothing exciting, but reasonable again.

In all, if u look at PE growth, neigh...
If u believe in PB alignment Swee.

In totality, is a reasonable deal if u pay below 3.5 ( which u will be doing if u have been buying in the last 5 years, since not it is not often that it goes above 3.5 and stay there) 

Finally, the deal is hardly the deal of the century, but is it better than no-deal? 

I believed it is better than no-deal for most people with investment horizon of not more than 2 years, and are vested in the last 5 years.

You might not agree with me. Investors seldom agree with each other. But, pitching this as a dumping of troubled assets and comparing it to Sembmarine is pushing it too far 
https://www.theonlinecitizen.com/2021/03/30/mas-sgx-need-to-scrutinise-capitalands-latest-restructuring-plan-protect-retail-investors-from-its-troubled-assets/

So what are your thoughts? 


Friday, April 2, 2021

Random thoughts: What I crave since a child?

Think I am getting old, keep thinking about the past. As i watch my son grows, I often had memories of myself coming back to me.

When I was child, I was the youngest. I wasn't from a well-off family, but neither were we poor. I crave riches. I am envous of my cousin who had the latest toys. He had a store-room of mask (thunderbirds transformed vehicles).I spent long time looking at kids playing video games (rental of 1 hours sega genesis, and my favourite was golden axe)

I remembered I was looking at toys with a neighbor and commenting insensitively that "u have money, you buy lor" 
 
I remembered pestering my mum to fulfilled a causal remark to buy me a toy. 

When I become a teenager, I didn't shake that off. But added to that, I craved attention and adoration. 

I hide my envy better, but had not come to terms with them. I always wanted recognition from others, friends, teachers and particularly girls. 

I remember doing a lot of "unique and idiotic" stuff just to get friends' attention and praises. Like painting with my hands although I know nothing about it. Waiting eagerly for my friend to praise me when I perform a song with my friends at a elderly hospital. 

During secondary and college days, I have insecurity with money. Looking backwards, I wondered why I always break out in cold sweat and having this crazy thoughts that we were bankrupt and my dad has to go snatching a 50 cents coin from others. (Maybe I am crazy)

As I become a young adult, I have all these too. Envy, comparison with others make me suffer from inferior complex. Secretly comparing myself with my secondary friend who is doing much better than me. But one thing did progress. While I feel inferior, I no longer habour any unkind thoughts against my friend, I just respect and admire his status and capabilities.

As I crossed over to my 40s. I understood that these sins are still with me. As human perhaps, they would always be with us, and we need to be constantly come to terms with them and keep it in check.

Affirmation takes a different form. Although I need little affirmation from peers or superiors, I realised I still crave a lot of it from my pupils. 

Riches, perhap is one thing I am more contented with. With jealousy of others with bigger portfolio at a younger age abated, I really do not feel much about it now. I am comfortable with my "wealth" and "rate of accumulation". I am at days insecure about my financial well being, but that is intrinsically triggered rather than externally triggered. I believed while money solve a lot of problem, how badly the future plays out depend on the choices made there and then too, and not just what we do now. 

In fact, as I blog, I find the noise of "what's the point" getting louder and louder whenever I feel like blogging about a company and its results.

I hope my son will be at peace with himself as he grows. 

Tuesday, March 30, 2021

Random thoughts: To sell into strength?

Coincidentally, today I received a message from a friend and a broker. My broker advise me to take profit as STI has hit 3200, but I didn't like the fear tactics deployed comparing to Lehman moment, which I think is pure bullshit. My friend ask me why STI hit 3200, when the economy has not recovered.

I did took a hard look at all my counters and I DO Wish to take some profits off the table, yet, when I examine the results to buy, they are still intact, even using a generic reason of rebalancing didn't really make sense, as counters that run the most doesn't really take up a big chunk of my portfolio. Yup, my bigger bets didn't do as well as my smaller bets. I do want to keep a sizable portfolio vested as I believed my entry price is of value.

I am quite sure the market is due for a breather, I am not too sure if there will be a correction (10 percent drop) and I find it unlikely that the market will go to bear 🐻 status. ( That would properly be my break even price and I will likely hit my head again) and I believe it is even more remote for it to reach March low of 2020. I use no leverage and I have holding power if the worst do happen. 

I know there are many schools of thought, some TA investors might make sure of the volatility and earn the gap. I am not in that school.

Some traders also might see resistance or momentum and want to profit from it.

I am rather the boring guy who buy when I see a gap to valuation, and sell when I believe the growth catalysts are all fulfilled or if it is overvalued due to euphoria. 

Looking at the counters I had, I did trim TianNeng Power from HK, but other than that, I see a few more quarters of good reports, and I also see a fundamental shift in business structure for quite a few companies.

Ya.. I, like what some other investors, say, are the subjective opinioned guy.

I think I can sleep with my though process though, as I suffer no cognitive dissonance. 

Hope u be at peace at your choice and huat. I hope I made the right call.  

Thursday, March 18, 2021

Random thoughts aplenty

My Dad Money values

Been missing my dad. He keep appearing in my mind. I remembered once he was hospitalised, I paid for his bills. It was during my NS time. 

He told me he will pay me back. I refused, and told him it is fine. In those days, there isn't easy transfer of money, I refused to take his cash. I said it is fine, really.

I remembered one fine day, when I am checking my balance, I suddenly found a few thousand more. My dad has took my bank book and went to the bank to deposit the money. He told me he can still manage.

Years later, when I graduated. He told me he will pass me 5K. I ask whatever for. He told me he gave 500 a month to my elder brother and elder sister when they are doing their undergraduate studies. He won't be giving me that, but will give me a lump sum. I told him not to worry about that, in fact, I signed a bond with the ministry so that my studies will be fully paid for, and I get a allowance so that he can retired. He doesn't have to hang on there being a hawker just for me.

Anyway, I jokingly told him the sum doesn't add up. I he should keep the money for himself since he is no longer working. Come wedding day, he gave a hongbao of 5 thousand.

My father is a hawker who only finished primary 2 education. Yet, he is a Man of his word when money is concerned. He told me he cannot show favouritism.

In case u think he is just loose with money, or that he is overly pampering his children. He leads a very frugal life. Every year end bonus, I would top up my allowance by a bit for him. One day, he told me that my brother didn't do that, and that it isn't "nice"

I told my brother about it. I believed it is not about the money per se, but being fair in money matters. 

One does not need to be rich to be principled in money matters.

Run your own race

I have my fair share of rat race. Corporate race, self-imposed investment race, trying to beat the investment bloggers and forummers out there.

It is a Zen action. From feeling delusional, jealous, I feel less of a need to prove myself.

I believe when we are young, we should work hard and try our best to climb the ladder, the win the race. But I reached the stage of life where I much appreciate to run my own race, be it in my job or investment returns.

I only hope for 圆满, rather than 美满, in whatever I do. I need closures, not fairy tales 

I know of several people who profited handsomely from crypo investment. This time round, I am honest with myself, but I hardly feel much jealously toward them. I really wish them the best and respect them for their understanding and courage in niche investment. I didn't want to go into them despite one of them asking me to invest with him.

I do not have thoughts like, "is risky, see, I told you" but more of I walk my path, I am happy for you if u make it. I know any investment can be profitable if u know how to "get off" or "milk it"

I do feel like bragging about my returns on my blog, but too bad, there is nothing to brag about. But I dun feel unhappy about it.

Saturday, February 27, 2021

A review of my company prospecting process: More hits than misses

Less than a year ago, after a screening process, I highlight 4 companies

https://sillyinvestor.blogspot.com/2020/05/company-prospecting-process-maxi-cash.html

Of the 4 companies, Maxi-cash, Muti-chem, Hotung, and Overseas Family education,

I only invested in Hotung. 

Maxi-cash and Muti-Chem gives capital gain of 50% and 70% had in invested in them, and Hotung, just 15%, excluding dividends. 

What went wrong? I think I have current yield bias, and aversion to company with high loan to equity ratio. Could I have done better? I am not sure. I guess missing out on gains is better than holding on to losses.

I predicted improving dividends for 3 counters in blogpost here

https://sillyinvestor.blogspot.com/2020/12/merry-chiristmas-here-are-3-companies.html

Of the three, YZJ kept is earnings intact, Kayhian did increase it, and Verdict is not out yet on CSCP. Companies that pay out dividends as a ratio of earnings could see higher volatility of dividends but it might made timing the turnaround more rewarding. BAE system also guided on 50% payout, and with improving earnings (Projected), I hope to repeat the success of it. 

Third, using Free cash flow yield

https://sillyinvestor.blogspot.com/2020/12/merry-chiristmas-here-are-3-companies.html

1) Lung Kee (HK 0255) (15%)

2)Yangzijiang (13%)

3) Lonking (HK3339) (13%)

4) *Diary Farm International (13%)

Closely followed by Silverlake Axis and Singpost in the 8-9 % range.


In terms of capital gains, with exception of lonking, all are in the range of 10%, DFI and Silverlake are loss making and I have exited SIlverlake after they suspended dividends in 1H.

I recently also found another company 0819 TianNeng Power with FCF in excess of 10%, PE in the range of 10, in the sector of making batteries for EV and etc. An growing company in a growing industry should deserve better valuation and due to the min lot size of 2000 shares, it is my biggest HK purchase. However, I am already 10% underwater. 

FCF yield need longer runway before they can appreciated by market? 

The better counters, such as SATS(>50% gain), has nothing fundemental improving, although the outlook is defintely better. 

The concluding thought I have, is hence:

I really hope to count on luck, and hence diversification is important. After I sold off Silverlake, non of my counters hold more than 5% in my portfolio. In fact, most of then are in the 2-3% range. 

Hence, although i do have some counters than are gaining 70% or 50%, as a portfolio, it is just 6% gain based on COST. 

Hope I continue to be lucky. 

 

Friday, February 26, 2021

Random thoughts: Pence wise and Pound foolish, literally

Recently, I bought BAE systems from London exchanges (LSE) 

When I check my balance i saw this my purchase price is 4.735
I ask why 4.735, when the message alert I received is 473.5 

I thought it is a error from kayhian side. I even joked with my broker and fellow bloggers that I got a 100 baggers.

My broker tried to explain to me it is in Pence. He send me the conversion rate, I say I am aware it it is pound. 

I ask why divide by 100. He exasperatedly said it is pence, like cents ... 

And I go oops. 

And I ask, and they allow trading of 1 share?? 

End up I paid double the commission to get the quantity I wanted. 

LOL. Had a good laugh. Sillyinvestor indeed.