Author: 10% Per Annum

Book Review: 5 takeaways from Mohnish Pabrai’s The Dhandho Investor

About the Author: Mohnish Pabrai is an accomplished fund manager and unabashed fan of Warren Buffett. Pabrai’s Investment Fund had outperformed all major indices and over 99% of other managed funds by delivering an annualized return of over 28% after fees and expenses from 1999 to 2006. About the book: Pabrai illustrates the concept of “Dhandho” and its applications to investing through examples of how vastly different individuals became successful entrepreneurs. He then distills his stock investing approach by sharing exactly how he selects counters. I would classify this book as a true and underappreciated classic. Here are 5...

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Book Review: 5 takeaways from Joel Greenblatt’s You Can Be A Stock Market Genius

About the Author: Joel Greenblatt is the founder of Gotham Capital, an investment partnership that achieved 50% annualized returns from founding in 1985 till close in 1995. $1 invested with Mr Greenblatt during the partnership would have snowballed into $51.97 in less than 10 years! About the book: You Can Be A Stock Market Genius is the 2nd Joel Greenblatt’s book that I have read. Compared to “The Little Book that still Beats the Market“, this book is likely written for more advanced investors. The book specifically discusses the merits of investing in special situations ranging from spin-offs to restructurings....

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New Counter: AEM Holdings Ltd

I am pleased to add a new counter to my portfolio, especially since it has been more than 4 months since I last bought anything. Despite the new addition, my portfolio’s cash position stands at a healthy 27%, in line with my portfolio re-balancing goals (here). Equity: AEM Holdings Ltd (SGX: AWX)   Business: Semiconductors Markets exposed: Global Stock exchange: SGX Purchase price: 2.31 (Cum Dividends) Purchase month: September 10% per annum thesis:  AEM is now considered a fast grower, having turned their business around. Introduction: AEM is involved in the semiconductor industry, specifically in the back-end chip assembly...

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Divested Tai Sin for 16% annualized return

Summary I have decided to divest and take profit on Tai Sin due to fundamentals trending apart from my initial investment thesis. Note: price includes transactional costs Despite the failure of my investment thesis, I am happy to book an annualized gain exceeding 10% per annum. I attribute this to the large margin of safety that Tai Sin had in February at S$0.398 per share, which has diminished with my sale Price to Earnings ratio of 10.2.  With this divestment, and in line with my portfolio goals (here), I have also raised my portfolio cash holdings to 37%.  Divestment...

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Book Giveaway: Poor Charlie’s Almanack (NEW!)

While I would prefer to be known as a generous and altruistic individual, the unfortunate truth is that I simply bought the wrong version – this book is written in traditional Chinese, which is in turn way beyond my level of command for the language. While I am unable to comprehend the book, my hope is to benefit someone who is both capable of understanding the writing and interested in finding out more about Charlie’s wisdom. I am giving this book away for free, but reserve the right to charge for postage. Interested individuals can fill up a short google form here....

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InnoTek 1H’17 Results Review – Crucial Year Ahead

InnoTek had released their 1H’17 results on 12th August, which you may find here. This is my first results review for InnoTek since my initiation (here). Unfortunately, InnoTek had performed below my expectations and reported disappointing results. Overview   Year-on-Year comparison Source: InnoTek Press Release Revenue for 2Q’17 slid 3.2%. Gross margins was marginally weaker by 1%. Net Profit and earnings per share were both hammered, falling almost 77%. To top if off, 2Q’17 was a quarter of negative cash flow, although InnoTek did generate positive free cash flow of S$0.8M for 1H’17. The decline was driven by lower demand...

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Divested Keong Hong for a 11.2% annualized return

I wrote in early June about my plans to re-balance my portfolio (here). In summary, I had wanted to: 1) Increase cash position to at least 20% of my portfolio 2) Increase percentage of portfolio vested in companies with more resilient demand 3) Increase holdings only in companies with strong balance sheets With my portfolio re-balancing plans in mind, I have divested my holdings in Keong Hong (SGX:5TT) at $0.48 per share to record a respectable 11.2% annualized profits. Together with an increase in savings over the past 2 months, my portfolio cash holdings has now increased from around...

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Sapphire 1H’17 Results – Turnaround Continues

As the saying goes, it never rains but it pours – unfortunately for myself, a few of my holdings had chosen to announce results today just as I am scheduled for a busy weekend. Faced with a list of counters which I would ideally like to look at, I have nonetheless prioritized the review of Sapphire’s results as this will be my first review since establishing a position in this counter (here). Overview   Year-on-Year Comparison   Source: Sapphire’s 1H’17 Financial Statement Despite a 11.8% year-on-year revenue growth, Sapphire’s operating profits had slumped 12.1% over the same period. This...

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Hock Lian Seng 1H’17 Earnings Review

It has been almost 6 months since my last review on Hock Lian Seng (here). Therefore, I thought it was high time to scrutinize their 1H’2017 results release today (here). Boring Results (again) Source: Hock Lian Seng 1H’17 Financial Statement Hock Lian Seng’s results were once again completely in line with my expectations. Hock Lian Seng’s order book had declined from approximately S$950M in February to approximately S$890M, roughly matching the revenue of S$51M. I am unable to account for the supposed S$9M gap definitively as the exact date and value of order book were never announced, but this...

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Global Manufacturing Bull – a PMI review

Stock markets have been scaling new heights around the world and a significant contributor to this ongoing phenomenon has been the global manufacturing resurgence. One way to better assess the momentum of this upswing is through reading of Manufacturing Purchasing Managers’ Index (PMI). What is PMI? PMI is essentially an economic indicator derived from monthly surveys of private sector companies. The surveys are based on major indicators such as new orders, inventory levels, production, supplier deliveries and the employment level. A PMI of more than 50 represents expansion of the manufacturing sector when compared to the previous month. Naturally,...

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Book Review: 5 takeaways from Howard Marks’ The Most Important Thing Illuminated

    About the Author: Howard Marks is co-founder and co-chairman of Oaktree Capital Management, a market leading investment firm that first made its name investing in distressed debt. Oaktree’s defensive strategy had proven tremendously successful over the long run. It had beaten the market handsomely over the course of its history, resulting in growth in assets under management from US$5 billion in 1995 to US$100 billion today. About the book: The Most Important Thing Illuminated discusses 20 important considerations that Marks believe to be essential for successful investors. It is an insightful book which offers qualitative advice to...

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Take Analyst Reports with a Pinch of Salt

I have always maintained that analyst reports are important references for investors. They contain critical information that the average investor would not have access to, such as results from site visits and insights derived from management interactions. However, for all the value that an investor can derive from analyst reports, I recommend to take them with a pinch of salt. While analysts are indeed professionals, that does not preclude them from mistakes. Occasionally, analysts might even be guilty of severe conflict of interests (as NRA Capital showed with 1MDB here). I will use Japfa as an example to illustrate...

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Value Investing – learning from OKP’s flyover collapse

Who is OKP? OKP Holdings Limited is a company listed on Singapore Exchange. While the company also dabbles with property development and investments, their primary business remains public sector infrastructure construction and civil engineering. How has OKP performed?   Source: Yahoo Finance   OKP’s share price has performed admirably in the past 2 years, surging 126% from S$0.19 to S$0.43 before the fall in share price after the incident. Indeed, the investment thesis for OKP was rather straightforward. Singapore’s infrastructure demands are growing steadily and firms that win tender do not have to worry about receivables. When we consider...

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7 reasons why HRnetgroup is on my watchlist

HRnetgroup is a recent IPO on the Singapore Exchange which officially begun trading on June 16. Since then, their share price had faced unrelenting downward pressure. Despite repeated purchases by the Stabilising Manager, their share price had fallen below the IPO price of S$0.90. Source: SGX Company Announcements   Declining share price aside, HRnetgroup actually runs a very decent business. As with all decent businesses, I would be happy to invest when the price is attractive enough. Here are 7 reasons why it currently sits on my watchlist: 1) Strong Track Record of Growth Source: HRnetgroup Prospectus 2) Resilient...

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Book Review: 5 takeaways from Joel Greenblatt’s Little Book that still Beats the Market

I have not really been posting as regularly as I would have liked this month, simply because there is little investing action to speak of. This is primarily down to 2 reasons: 1) I am super busy (and a little stressed) at work as I have to cover for a couple of my senior teammates who are on block leave. 2) In order to achieve my portfolio re-balancing goals (here), I have to pretty much sell to buy (and erm, I haven’t actually sold anything since). Nonetheless, I have managed to finish my first book since Peter Lynch’s double...

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