Author Archive

Posted on August 27, 2010 - by AK71

Saizen REIT: Better than expected DPU

Saizen REIT reported full year results this morning and declared a DPU of 0.26c, payable on 29 September 2010.  This is better than expected as the REIT did not have a full quarter to accumulate cash for distribution.  They also refinanced GK Choan and had to pay some fees as well as amortise that loan.  Read about it here.

So, I was expecting a smallish cash distribution of about 0.1c in September.  Instead, a DPU of 0.26c in September, given the difficult conditions, bodes well for the next DPU in December which would have a whole quarter to accumulate cash for distribution to unit holders.  I estimate the DPU in December to be between 0.4 to 0.5c.  Assuming it is 0.4c, that would give an annualised DPU of 1.6c and an annualised yield of 10% at the current unit price of 16c.

Some key numbers from the reports:

1.  Annual valuation of properties (161 Freehold buildings in Japan) declined 4% from a year ago from JPY42,051.1m to JPY40,381.7m.  The rate of decline has slowed and this is in line with the general view that real estate prices in Japan are bottoming.  Read valuation report here.

2.  NAV is still at 40c per unit given the strong JPY.  The JPY is likely to stay strong, given the concerns of weak recoveries in heavily indebted western economies. Read more…

Posted on August 16, 2010 - by AK71

Healthway Medical: Second quarter results

Healthway Medical announced that it has entered into agreements with twelve (12) medical and dental centres in Shanghai and Hangzhou. To operate and manage these facilities, an investment of RMB38m (or S$7.6m) is required over a period of three months. They hope to increase the number of facilities under management to more than twenty by end of this year.

At the same time, Healthway Medical also released their second quarter results and the numbers look bad.

1. Revenue compared to the same period last year has tumbled 12.3% from S$24.45m to S$21.44m. This is worse than the first quarter when the revenue declined 6.3% compared to the same period a year ago.

2. Staff cost increased 22.9% which suggests that Healthway Medical is paying a lot more now to retain or to recruit staff. In terms of absolute dollars, the increase from S$10.75m to S$13.2m is no small change. Read more…

Posted on August 11, 2010 - by AK71

First REIT: Nick’s analysis

I got to know Nick recently while chatting in Bully the Bear’s cbox. I was so impressed with his analyses while chatting with him that I invited him to be a guest writer for my blog.

I am sharing Nick’s recent comments on First REIT in a proper post here:

I like to post the following 2 research reports released after the 2Q Briefing.

CIMB report is very interesting since there is information about the 2 potential acquisition targets and it mentions the need to raise funds from both debt and equity. It should be able to increase AUM by 50-70%. Looks like a good deal if CIMB figures are accurate.

SIAS:
http://firstreit.listedcompany.com/misc/First_REIT_-_2Q10_Update_Report.pdf

CIMB:
http://firstreit.listedcompany.com/misc/First_Reit.pdf

AND

I will most likely increase my exposure slightly near term. Naturally, we need to bear in mind that with the potential looming rights issue (could be announced in a matter of months), we need to conserve capital to subscribe for it. Read more…

Posted on August 6, 2010 - by AK71

Saizen REIT: Oversold.

Saizen REIT has been stuck at 16c for weeks. Nothing is happening and it is just a waiting game now.  However, it appears that most of the weaker holders have sold.

The Bollinger bands have narrowed and the MAs are all flattening with the exception of the long term 200dMA which is still rising.  In fact, the 20d and 50d MAs have merged and flatlined at 16c. 16c could either become a very strong support or resistance in future.  Looking at the MFI and the Stochastics, we see that this counter is very oversold. The OBV shows a stalemate between accumulation and distribution. Read more…

Posted on July 25, 2010 - by AK71

China Hongxing: Breakout.

The last time I wrote about China Hongxing was on 3 July. At that time, there were still mixed signals.

On Thursday, two sessions ago, there was a buy signal on the MACD histogram and the MFI broke out of its downtrend. Volume expanded 10 times in the last session as price hit a high of 14.5c. Read more…

Posted on July 14, 2010 - by AK71

Saizen REIT: An update.

Saizen REIT has seemingly gone into hibernation.  For more than a month, its price has fluctuated between 16c and 16.5c. The daily MAs have all flatlined. Some may wonder if I am still interested in this REIT.  Well, I am still very much interested in this REIT.  It remains one of my top three investments in the stock market.  Regular readers of my blog would know that I believe it to be a very good investment with more than a fair bit of potential to deliver an attractive yield and possibly an even more attractive capital appreciation.

Today, the technicals are rather interesting. Of course, with volume so thin, it could just be a mirage but let us do this just for fun, if nothing else. Read more…

Posted on July 11, 2010 - by AK71

FSL Trust: The skies are clearing up.

Price stayed above the 20dMA in the last three sessions. The 20dMA, currently at 38.5c, is now resistance turned support. I decided to look at the 20dEMA as well.  The EMA gives greater weightage to recent prices and could sometime explain why price could not move past a certain point in the short term.  The 20dEMA is at 39.5c and seeing the price closed at 40c in the last two sessions is comforting.  However, the volumes were very low and the durability of the recent appreciation in price is questionable.  In fact, since a spike in volume on 18 Jun when the MACD made a bullish crossover with the signal line, volume has been reducing.

Let us look at some other technical indicators to gain more insights. Read more…

Posted on June 28, 2010 - by AK71

CapitaMalls Asia: Weakening technicals

CapitaMalls Asia broke out of its symmetrical triangle on 16 Jun on higher volume. It then went on to break resistance provided by the declining 100dMA which coincided with the trendline resistrance on 21 Jun. It was not able to advance much further and I suggested looking at the 100dEMA which made it clear why it was so.

In the last session, support was provided by the rising 20dMA and a short white candle was formed. The 20dMA in recent sessions has merged with the trendline support and, theoretically, should be a strong support.  This is the third time this trendline support has been tested.  If a trader had bought some shares of CapitaMalls Asia each time its price tested this trendline support, he would have made some nice gains.  So, is it time to buy again? Read more…

Posted on June 17, 2010 - by AK71

Charts in brief: 16 Jun 2010.

Golden Agriculture: Price rose and met resistance at 55c as expected. The falling 50dMA and 100dMA both approximate 55c which makes this a strong resistance.  If this could be taken out, we could likely see a target of 57.5c which is where we find the 138.2% Fibo line.  This is also a gap resistance.

AIMS AMP Capital Industrial REIT: The fourth gravestone doji in seven sessions.  21.5c is being tested vigorously as the immediate support. MACD has dipped into negative territory while the MFI and OBV have flattened.  The loss in buying momentum is obvious. Read more…

Posted on June 14, 2010 - by AK71

FSL Trust: A crisis or an opportunity?

I still have units of FSL Trust which were bought at an average price of S$1.00 per unit. By any stretch of imagination, I cannot foresee FSL Trust trading at S$1.00 per unit in the next few years, if ever. I have kept these units in a frozen portfolio together with a few other stocks to remind myself of the mistakes I made.

As FSL Trust enjoyed a recovery in unit price and was trading at an average of 60c for about a year till the first few days of May 2010, reaching a high of 69.5c in July 2009, I advised potential investors that it is still a risky investment. The primary reason why I consider FSL Trust to be a risky investment is its indebtedness.

As of 31 March 2010, it had bank loans of US$484.6m. This has been reduced to US$ 477.1m after another loan payment was made in April 2010. FSL Trust makes quarterly loan payments. About half of the loans will mature in April 2012 and the rest are maturing in March 2014. Although its vessels are valued at US$826m, it only has US$56m in cash and cash equivalents as of 31 March 2010. Read more…