Author: BULLy the BEAR

The Joseph cycle – Simon Sim (2004 edition)

I happened to come across a copy of the famous book by Simon Sim – The Joseph Cycle (2004 edition) while browsing through the Singapore section of the national library. Much to my surprise, there are a lot of gems and treasures hidden among the Singapore section, which I had always avoided till yesterday. There are old copies of company annual reports, industry and market analysis, accounting standards in Singapore, local tax guide, local real estate reports and even those very old stock investment and company info for Singapore context. You should go and take a look one day....

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DBS rights issue

DBS halt trading early this morning and rumors are flying about as to what is the actual reasons for the trading halt. I thought that DBS will be settling the troubled bonds issue today, as the relevant authorities mentioned that an answer would be made at the end of this month. But that was not the reason for the trading halt. The real reason caught me a little by surprise. DBS announced that it is going to raise capital to the tune of SGD 4 bil by issuing rights shares to existing shareholders. Rights exercise is basically an attempt...

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Managing the Schrodinger’s cat

I think there’s a fundamental shift in my research techniques. After immersing myself in investing and all the literature on investments, I came to the realisation that numbers and ratios are not everything. What is? Management! Imagine out of your classmates in secondary school, you’re supposed to pick one whom you think will have the greatest potential to be the most successful. Who do you pick? Do you pick the ones that perennially top the cohort? Do you select those who always play truant and disrupt the class? Do you pick the most talkative ones, or the most quiet...

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Silly stubborness and Cannular conviction

What’s the difference between stubbornness and conviction? I was linked to this thread in Wallstraits by musicwhiz, but it was during one of those walks, with the pettering and pattering of the rain hitting my umbrella that I thought a little more deeply about this. Let’s give a scenario to this. I researched in company X and after months of research, I finally bought into company X at a price that I deemed attractive. The price of company X subsequently dropped to 50% of my buy price. If you’ve been in the stock market for some time, you’ll realise...

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Hongguo 3Q results

Hongguo released its 3Q08 results last Fri. It wasn’t doing exceptionally well, but given the current state of matter, I think it’s quite alright. Let’s just do a quick one here. Here’s my thoughts on the statements: 1. Looking at the 3Q to 3Q results, revenue increased which is followed by an increase in both gross profit and net profit in absolute terms. However, gross and net margins fell slightly. The increase in revenues comes from the increase in more stores (150 in total) selling both the main C.Banner brand and E.Blan. However, JUC outlets decreased by 10 in...

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Valuable Vicom

By: La Papillion Long time ago, I mentioned about Vicom being a prime candidate for value at around $1.50, fully unaware that it will hit around $1.50 so soon this year. At the lowest, Vicom was trading at around $1.30 near end of Oct 2008. They just announced their 3Q results today. Here are the main ratios for Vicom over the last 9 months: ————————–9M08————9M07 Gross margins——–28.8%———–29.3% Net margins———–23.0%———–23.4% ROE (annualized)—–25.6%———–25.1% Current ratio————1.57————-1.35 Total debt/equity——-34.5%———-30.4% NAV for FY07 is $0.70, for 9M08 is $0.7532. This means that it’s trading at around 2x NAV at current price of $1.53 at...

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Surviving through lean times – Part 2

By: La Papillion Having talked about how to cope with possible recessionary fallout by trimming expenses and boosting income in order to boost savings, here I’m going to share about how to prepare myself psychologically for it. I believe the psychology part of preparing for the recession could be much more important than just the material aspects. This is because the mind will cause us to feel about the same thing differently at different times. You know what I mean, sometimes bad news feel like the end of the world, sometimes bad news feel like a mosquito bite. I...

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Surviving through lean times – Part 1

By: La Papillion Possibly facing my first recession since I started work 5-6 yrs ago, I think it’s a good time to figure out how to tide over this rough period. Fail to plan, plan to fail, they say. I think I need to think about 2 aspects of coping with the possible recession – How to save more and how to cope with it psychologically. But for this post, I’ll just focus more on the savings part. Maybe more on the psychology part at a more opportune time. How I’m going to save more The golden rule applies...

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Keep your style, fade your fashion

By: La Papillion It’s simply not fashionable to invest in debt-ridden companies now. Investment are like clothes. There are investments themes that come and go with the vicissitudes of fashion wear. From my short history of market experience, I already can see the different main fashion themes which are hot at different periods. In the bull market, there are many many themes. Sector rotation, I think that’s what they call it. I used to pay attention to companies belonging to a certain sector, like construction plays, oil plays, property plays etc, and look out for companies in those sector...

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Opinion piece by Warren Buffett

By: La Papillion With the STI coming down to 1880 and DJ showing no signs of breaking down from its fast and rapid decline southwards, there is plenty of fear in the market. Once, I had heard of people talking about stocks and shares..but now, the library is full of books on investing that nobody is interested to borrow and everyone is not looking at the share prices now. Is it the first sign of market bottoming? My support level for STI is still 1800, which I think is a pretty safe level to do something with your excess...

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OCBC’s valuation range

By: La Papillion I learnt a little more about the person who wanted a stake in Ocbc. She wanted to pass it on to her future generations, so the time horizon can be stretched further than the 3-5 yrs that she had told me initially. As such, preference shares might not be the best option anymore. I’m looking more into OCBC because that’s what she wanted. This is based on the data I posted on my earlier post. Based on historical data, the dividends per share (excluding extraordinary and special dividends) had been increasing steadily for the past 5...

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Ferro Trouble

By: La Papillion Ferrochina announced very grimly news. Due to the current economic crisis, they are unable to repay part of its working capital loans amounting to about RMB 706 mil, which had become due and payable. As a result, further loan facilities and notes of about RMB 2,030 mil may potentially become due and payable. Another sum of working capital loans of RMB 2,493 mil may also become due and payable. Ferro china is thus currently in active negotiations with its financial lenders to explore various options (including refinancing) to address its repayment obligations. If unsuccessful, they will...

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Origins of the Crash

By: La Papillion I’ve finished the very readable book by Roger Lowenstein, titled “Origins of the Crash”. There are many books that talked about crashes, but this book focuses more on the dot.com bubble, collapse of Enron, accounting scandal at Andersen and the telecommunications bubble, with the author linking the excesses of past markets to the downfall of future bubble. There are a few key take aways that I got from this book. Bubbles are caused by a series of factors: 1. Lack of corporate governance. There are stories of dot.com companies where the CEO and chairman of the...

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Preference shares Part 1

By: La Papillion After chatting with a few guys over at the cbox, I realized that a better instrument for the person who wanted to buy OCBC (see my post on “Brief overview of Local banks“) will be the preference shares that is also offered by the three banks. Preference shares goes by the funny stock name with many letters in it. Here’s the list of all the listed preference shares by the three local banks. 1. UOB 5.05% NCPS 100 2. DBS Bk 6% NCPS 10 3. OCBC Bk 4.2% NCPS 100 4. OCBC Bk 4.5% NCPS 100...

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Brief overview of local banks

By: La Papillion Is it time to buy local banks now? Someone wanted to invest a substantial amount of money into OCBC, so I thought I would do a little research to see whether it makes sense. I do not really know how to valuate banks and will not attempt to do so here. Rather, I’ll just dig into the past number and let the reader do the rest of the legwork, if they are interested. My source for these information comes from Shares Investment book (340 issue) and the respective banks’ website. Here is the brief overview of...

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