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Level13

Desperate, Bold Step by DBS

December 23, 2008 by Level13

DBS announced today that it will be issuing rights to raise net proceeds of approximately SGD4 billion. Pursuant to the Rights Issue, 760,480,229 Rights Shares will be offered at SGD5.42 per Rights Share on the basis of one Rights Share for every two Shares held. At this moment, there are 2 burning questions on the [...]

in Categories: Investing, Shares and Derivatives

Updates on Bright World takeover

December 5, 2008 by Level13

Recently, the share price of Bright World(BW) came under further pressure as a result of a letter sent to its directors from the Monetary Authority of Singapore (MAS), referring to a possible breach of section 203 of the Securities and Futures Act. What is section 203 of the Securities and Futures Act? Section 203 (Continuous [...]

in Categories: Featured, Shares and Derivatives

Eight years recap

November 23, 2008 by Level13

For those who need a recap on what has happened in the investment world for the past 108 years, The Global Investment Returns Yearbook (GIRY), compiled by London Business School experts is definitely an eye opener. The core of the Yearbook is provided by a long-run study since 1900 in all the main asset categories [...]

in Categories: Market Review and Trends

Crude oil price is all rubbish!

November 8, 2008 by Level13

By: Level13 Around 4 months ago, crude oil price was at about USD140 per barrel. Fast forward to the last weekend, after a slew of bad news and poor earnings outlook hit the market, crude oil is only trading at about USD62 per barrel. After witnessing a drop of 55% in crude oil price, I [...]

in Categories: Market Review and Trends

Sweeteners for Bright World takeover

November 1, 2008 by Level13

By: Level13 A few days ago, CHAC and BW jointly announced the terms of the amended agreement in the takeover offer. Things that have been changed: 1) Valuation and purchase price of BW. The revised transaction results in a minimum valuation of Bright World at approximately USD255 million (assuming CHAC acquires all issued Bright World [...]

in Categories: Shares and Derivatives

Saving mini investors

October 15, 2008 by Level13

By: Level13 Currently the Hong Kong government is trying very hard to intervene and arrange for a compensation package to all minibond investors. There has been immense pressure by the Singapore minibond investors on the local authorities to step in and arrange a similar bailout. With all due respect, I personally do not think that [...]

in Categories: Investing

My view on Bright World takeover (Part 1)

September 25, 2008 by Level13

By: Level13 This write-up on Bright World (BW) is divided into 2 parts. It contains my deductions based on publicly available info on the takeover of BW. Before I begin, please take note that i am vested in BW and my views may be biased. What is mentioned in this posting cannot and should not [...]

in Categories: Shares and Derivatives

Value in textile industry? No way!

September 7, 2008 by Level13

By: Level13 Below is a recent recommendation by one of the brokerage companies on the SGX comapnies involved in the textile industry: Risk-reward ratio getting attractive. In fact, these textile companies are generally financially sound. They are in net cash position and are still garnering lucrative net margin of 26%-30%, rewarding investors with adecent ROE [...]

in Categories: Investing

Price Movement

August 12, 2008 by Level13

By: Level13 This posting is not to encourage readers to trade. For most people, it has been proven that constant trading is detrimental to their investment return. However, as a retail investor, we should have a general knowledge of the signals that the price movement is indicating to us. The price movement of a stock [...]

in Categories: Investing

Temasek reduces Merrill Lynch stake – True or False

July 28, 2008 by Level13

Though it has been confirmed to be incorrect now, Level13 shares his view on how one should always double check on the reports and not follow blindly. By: Level13 Before you come to the conclusion that Temasek has made a lousy investment decision which has resulted in losses, it seems like nobody can verify on [...]

in Categories: Investing

RTO = Ready to offload

July 13, 2008 by Level13

By: Level13 In the Business Times on Thursday: Backdoor listing is the flavour of the season as companies are taking the reverse takeover (RTO) route to the stock exchange instead of initial public offerings (IPOs). In the first half of this year, the value of announced reverse takeovers (RTOs) on the Singapore Exchange surged to [...]

in Categories: Investing

Who’s the real culprit?

July 6, 2008 by Level13

By: Level13 Below are some of the versions we read about recently on the reasons behind the relentless price increase of commodities. VERSION 1: Speculators In the current global economic slowdown, it would be fundamentally reasonable to assume that consumption has gone down and prices have weakened. This indeed is the case for lead, zinc [...]

in Categories: Investing

Competitive advantage period (CAP) — Part 3

July 2, 2008 by Level13

By: Level13 The CAP for the U.S. stock market, as a whole, is estimated to be between 10 and15 years. However, within that aggregate, individual company CAPs can vary from 0-2 years to over 20 years. As a general rule, companies with low multiples tend to have shorter CAPs. Alternatively, companies with high multiples typically [...]

in Categories: Investing

Competitive advantage period (CAP) — Part 2

June 8, 2008 by Level13

By: Level13 Competitive advantage period (CAP) is the time during which a company is expected to generate returns on incremental investment that exceed its cost of capital. Economic theory suggests that competitive forces will drive returns down to the cost of capital over time. If a company earns above market required returns, it will attract [...]

in Categories: Investing

Competitive advantage period (CAP) — Part 1

June 7, 2008 by Level13

By: Level13 In 1991, Barrie Wigmore, a Goldman Sachs limited partner, released a study that attempted to determine what factors drove the stock market’s above-average returns in the decade of the 1980s. After carefully accounting for earnings growth, interest rate declines, M&A activity and analysts’ rosy forecasts, it appeared a full 38% of the shareholder [...]

in Categories: Investing

Economic Value Added (EVA) Ratio

April 22, 2008 by Level13

By: Level13 Economic Value Added (EVA) is a frequently used ratio by investors from developed market economies. The basic idea of this formula is based on the foundation that the main goal of a company is to maximize profit. However it does not mean book profit (the difference between revenues and costs) but economical profit. [...]

in Categories: Investing

What is Competitive Advantage?

April 4, 2008 by Level13

By: Level13 The true definition i got from the internet for competitive advantage is as follows: An advantage that a firm has over its competitors, allowing it to generate greater sales or margins and/or retain more customers than its competition. Competitive advantages give a company an edge over its rivals and an ability to generate [...]

in Categories: Investing

Acquiring a business – How not to do it (China Powerplus case)

March 24, 2008 by Level13

By: Level13 Investors need to evaluate motives for a merger in order to asses whether the newly formed entity is likely to create long-term value or not. There are numerous questions concerning motives for any merger that need to be asked and answered when evaluating the new company. Among others, investors need to know if [...]

in Categories: Investing, Shares and Derivatives

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