Tuesday, November 20, 2012

Updates 4Q 2012


Sincere apologies that I have been largely away and unable to write more.

2012 largely has been fairly interesting, apart from the usual problems "still" plaguing in Europe (Spain and Greece) again. It is also interesting to note several large Japanese corporates are suffering from the stronger Yen, weakening domestic corporates and of course holding of the relevant companies' stock (ex. Sharp, Panasonic) especially the financial institutions. Link of news from Bloomberg HERE

More importantly, I was glad to know someone has similar findings to what I wrote about OLAM  previously HERE. Stock has also fallen some 12 % in 2012 YTD alone.

The single most interesting corporate action in Asia involving F&N also took a new twist with OUE coming into play with well known funds like Farallon coming into the bid which imho is playing a financing role. This highlights the scarcity of assets as well as the silent expansion of global capital largely resulting from quantitative easing which in turn results in the inflation of prices.

Other updates on holdings as follows:

  1. Roxy Pacific 
    • recent dividend policy of paying out min 50% of net operating profit of the hotel business which translates to about $6 to 10m per annum. Link HERE
    • Mgmt also upped their capital in the hotel business 
    • 3Q revenue declined vs 2011 and is above 2009 levels, mainly due to 2011 benefiting from a large revaluation gain of $9.7m from Kovan Centre 
    • Grand Mecure is now worth some $438 M
    • Cash of $240M, debt of $433M, NAV $230M (pre-adjusted). With the hotel its $612M
    • Property development has some $844M of sales to be recognised, with $112M recognised
    • Hotel occupancy came down from 94 to 92%, while Revpar is up about 6% to $200. Its the star performer for 9M2012 thus far
    • Good to note that since the last call, the firm is up some 79% from post split cost of $0.29 to $0.52 currently (i.e market value of $491M)
  2. Haw Par 
    • I still hold my ground that this is a rather solid firm which has been misunderstood to be a pharma/ leisure company but really in essence an investment holding co
    • Results are up significantly but do not take it to heart since 2011 9M results were marred by a exceptional loss of $13.4M
    • Firm has $2.3B in assets and only $0.1B in total liabilities. Out of $2.3B, $1.78B is in AFS financial assets (i.e stocks, bonds) and $0.14B in cash and liquid deposits.
    • Market values this firm as $1.4B currently
    • Lastly, its help to note Mr. Wee (both Jr and Sr) are constantly buying back.
  3. World Precision 
    • Exposed to the slow down faced in China. However things are picking up from data signs of PMI and all. Will continue to update this shortly. 
  4. Koon 
    • Firm recently announced their plans to move into Malaysia property development supported by a rights issue. 
    • That in my opinion is not their niche and Im still trying to get my hands around it. 
    • The application date is 26 Nov 2012 so please take note.
  5. Nanyang Holdings 
    • No significant action on this front except that the recent HK government goals to revamp the industrial area in Kowloon which is helping to add value to many companies holding plots of land in that area, among which Nanyang is one of them. 

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