As mentioned previously, I’ll continue following certain companies even after divesting them as I think my in-depth knowledge about them is a competitive advantage. Also, I believe it’s far more advantageous to understand a company very well, rather than several companies on a superficial basis. In short, quality over quantity.

I have previously explained my reasons for divesting HLS (Post-mortem of Hock Lian Seng Divestment)

To summarize, the main points that I mentioned are:

• “There are some signs that convinced me to divest. For starters, HLS has lost their dorm as the lease is up. Earnings from this dorm accounted for almost 20% of gross profit in FY12 and FY13.  That works out to be about $5mil of gross profit.”
• ” I expect HLS earnings to normalize to the 4.5-6.5 cents range.”
• “the gross profit from civil engineering has already dropped from FY16Q1 compared ...

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