Author: SmallCapAsia

We had an exclusive corporate visit at Hyphens Group on 6th July 2019 (Saturday) and it was really an eye opener! InvestingNote has taken quite a number of photos for the corporate visit and you can check them out here. I am really heartened to see that more than 60 people had turned up on a Saturday morning when they could have snoozed their way after a long week. That said, I believed that they were rewarded plenty with the generous hospitality of the Hyphens team – refreshments, tour around the company and networking sessions. More importantly, I left...

With over 700+ stocks listed in SGX, it’s not easy to keep tab of all the on-going developments such as Share buybacks, Acquisitions, Quarterly Results and much more. Moreover, these announcements can sometimes bring about a huge impact to the company’s future course of action. Stock investors who are “in the know” may be better equipped to perform the necessary due diligence or even re-visit the investment thesis if necessary. With these in mind, we take a look at 3 companies with some interesting developments or news over the past week. 1) FortressMinerals achieved an outstanding 68.6% gross margin   FortressMinerals is Malaysia’s first iron ore concentrate explorer, miner and producer that is listed on SGX. On 9th July, Fortress Mineral announced its quarterly result...

#2: Financial Results  ST Group has achieved growth in both revenue and shareholders’ earnings over the past three years. Revenue had increased from A$ 24.2 million in 2016 to A$ 36.5 million in 2018. It is attributable to rising F&B revenue and franchising fees from PappaRich, NeNe Chicken, and Hokkaido Baked Cheese Tart resulting from their network expansion. Its shareholders’ earnings had increased from A$ 1.03 million in 2016 to A$ 2.72 million in 2018, which were in line with its increase in sales during the period.  Year 2016 2017 2018 Revenues (A$ ‘000) 24,204 30,314 36,479 Shareholders’ Earnings...

[*Update after Prime US REIT confirmed the IPO] On 28 June 2019, KBS Asia Partners Pte Ltd (KAP) filed in the IPO Prospectus of Prime US REIT IPO – marking the fifth U.S.-based REIT to list in Singapore to date. [Update: it has now filed its IPO Prospectus on 8th July. You can download Prime US REIT IPO prospectus here. ] Its units are offered at US$ 0.88 each with its distribution yield forecasted to be 7.4% in 2019 and 7.6% in 2020. The timing of the offering has not been finalised [Update below]. Sourced from PRIME US REIT...

On 28 June 2019, KBS Asia Partners Pte Ltd (KAP) filed in the IPO Prospectus of Prime US REIT IPO – marking the fifth U.S.-based REIT to list in Singapore to date. Its units are offered at US$ 0.88 each with its distribution yield forecasted to be 7.4% in 2019 and 7.6% in 2020. The timing of the offering has not been finalised. You can download Prime US REIT prelim IPO prospectus here.  Below, we will highlight summarize 7 things you need to know about Prime US REIT. Hence, here are 7 main things to know about Prime US...

KHJ has a 4-Year Return on Equity (ROE) of 18.10% per annum. This means, KHJ made, on average, RM 18.10 in annual earnings from every RM 100.00 it has in shareholders’ equity from 2015 to 2018. Figures in RM ‘000 unless stated otherwise Year 2015 2016 2017 2018 Revenues 77,031 84,858 93,310 97,687 Profits After Tax (PAT) 8,204 12,234 11,561 11,112 Earnings per Share (Sen) 2.16 3.22 3.04 2.92 Return on Equity (%) 17.71% 20.89% 18.61% 15.17% Source: KHJ’s IPO Document Page 153 #4: Balance Sheet Strength In 2018, KHJ repaid all of its borrowings and thus, have zero...

DLCs or Daily Leverage Certificates are a growing interest for investors around the globe. They made their first appearance in Europe in 2012 known at the time as constant leverage products or factor certificates. Since then, DLCs have become the talk of the town after they are included in the Singapore Exchange (SGX) and people have recognized these certificates as a great way to leverage returns. But given that DLCs are still relatively new financial investments, there are 5 things an investor should consider before diving in. 1. DLCs Are Short-Term Trading Instruments As the name suggests, DLCs are...

Before you even get started, click the button below to download the FREE Stock Intrinsic Value Calculator. Click to Download the Intrinsic Value Calculator After you signed up, you will receive an email with the calculator. Remember to save the excel somewhere and then Open the Excel file. You should see an old example of Jumbo Group (SGX: 42R) where i calculated its intrinsic value during Year 2016. In stocks investing world, we call it the Discounted Cash Flow (DCF) Method. Below is how it looks like: Moving on, we will go through the different fields step by step...

#2: Geographical Markets UWC Bhd’s primary market is in Malaysia where it contributed 58.6% of its total revenues in 2018. Its remaining 41.4% of revenues were contributed by exports to Singapore, the United States, France, China and the United Kingdom. Source: Page 96 of UWC Bhd’s IPO #3: Financial Track Record For the last 3 years, UWC Bhd has achieved growth in group revenues, up from RM 76.3 million in 2016 to RM 136.5 million in 2018. It is because the company has received higher orders from its main customers. As such, it has contributed to an increase in...

Known as the “Oracle of Omaha,” Warren Buffett is one of the most successful investors of all time. He started investing at the age 11 (while i am still figuring out how to play my 1st computer game!) and first filed taxes at age 13. Today, Buffett runs Berkshire Hathaway together with Charlie Munger and it owns more than 60 companies, including insurer Geico, battery maker Duracell and restaurant chain Dairy Queen. Amassing a wealth of more than US$60 billion, he’s promised to give away over 99% of his fortune and donated $3.4 billion in year 2018 itself. There...

#2: Financial Track Record Tricklestar Ltd has recorded higher revenues for the past 3 years. This has lifted the company from a net loss of US$ 0.26 million in 2016 to having net profits of US$ 1.97 million in 2018. Its adjusted earnings per share (EPS) had increased to 2.41 US cents in 2018, from a negative 0.31 US cents in 2016. The profit growth was contributed by an increase in sales and a dip in administrative expenses. Figures in US$ ‘000 in unless stated otherwise Year 2016 2017 2018 Revenues 8,894 10,322 12,841 Shareholders’ Earnings (256) 647 1,968...

#3: Financial Track Record For the last 4 years, Mestron has achieved growth in revenue, up from RM 40.5 million in 2015 to RM 63.7 million in 2018. This is contributed by rising sales for decorative light poles, specialty poles, and outdoor lighting products during the period. Shareholders’ earnings have grown from RM 2.15 million in 2015 to RM 9.31 million in 2018 due to lower raw material costs during the period. Earnings per share (EPS) had increased from 0.28 sen in 2015 to 1.18 sen in 2018. Mestron has a 4-Year Return on Equity (ROE) Average of 24.87%...

2. Deteriorating Fundamentals The second situation you should sell is when you notice deteriorating fundamentals in a company that you hold. The business environment is full of competition and even blue chip companies will face headwinds and run into trouble. It is the job of an investor to identify whether the company is in a temporary headwind or a permanent trouble. If it is the latter, you should sell the stock. Let me give you an example. Recent years, the Singapore’s leading media organisation, Singapore Press Holdings Limited (SGX: T39), is facing some trouble in their media content publishing business. In...

1. Past Business Performance One quick way is to look at a company’s past business performance. Try taking a full economic cycle of 5-10 years into consideration when looking at a company’s business performance (or at least for the past 3 years). Watch out for the following warning signs: Not profitable business (Low Return on Equity) Fluctuating Profits over the years (A sign of weak business model and lack of consistency) Negative Free Cash Flow (Persistent negative FCF will mean they require capital from borrowings or equity – rights issue) Business has too much debt (High Debt-to-Equity ratio) Read...