Author: The Fifth Person

Starhill Global REIT kept at ‘hold’ by CIMB with higher 82 cent target

CIMB maintains “hold” rating for Starhill Global REIT (SGREIT) and raises its price target to 82 cents after the REIT delivered a mixed performance in 3QFY16. The REIT’s 3QFY16 results were in line with CIMB’s expectations and made up roughly 25% of its and consensus full-year estimates. Nine-month distribution income formed 76% of its full-year forecast. 3Q topline grew by 12% to $53.6 million, thanks to contributions from Myer Centre Adelaide. This offset lower income from Wisma Atria, China, Malaysia and Japan assets as well as adverse forex impact from the Malaysian ringgit and Australian dollar. Net property income (NPI) in Singapore fell 1.5% to $26.4 million, dragged down by the...

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4 important things to consider before paying off your debts

So you have some money left over after paying the necessary bills. That’s good news. But should that money go toward investments or toward reducing your debt? It’s not a simple answer, and it depends on what you owe, how much you owe, and what your investment plans are. Here are some general guidelines on whether to invest your extra cash, or pay down your loans. 1. Always keep cash on hand for emergencies Do not fully empty your bank account in order to pay down debt or invest. Always keep some cash on hand for emergencies. A common...

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Maybank stays downbeat on Keppel and SembMarine as Sete Brasil opts to go bust

Maybank Kim Eng is keeping its “negative” view on the offshore and marine sector following news earlier today that shareholders of Sete Brasil have opted for bankruptcy protection and put the application to the courts next week. The way analyst Yeak Chee Keong sees it, investors need to know what kind of restructuring plans will be made. “This may involve banks taking over the assets and liabilities and selling them to new investors. But more importantly, we need clarity on which contracts will remain intact, whether and how Keppel and Sembcorp Marine (SMM) would be paid,” writes Yeak in his Thursday note. Keppel Corp has US$4.9 billion ($6.6 billion) worth of contracts with Sete...

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Frasers Commercial Trust’s 2Q DPU rises 2.9% to 2.45 cents

Frasers Commercial Trust’s (FCOTs) distribution per unit rose 2.9% to 2.45 cents in the second quarter ended March 31, 2016, from 2.38 cents a year ago. Net property income jumped 16.7% to $28.8 million from $24.7 million previously. The trust attributed this to the better performance of Alexandra Technopark as a result of higher rentals achieved and lower utilities expenses, as well as lower repair and maintenance and painting expenses for Caroline Chisholm Centre. The contribution from 357 Collins Street also boosted gross revenue and net property income during the quarter. FCOT achieved an occupancy rate of 92.6% for the portfolio as at March 31, 2016. The portfolio’s weighted average lease...

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5 things you need to know before investing in crowdfunding

The crowdfunding scene has undoubtedly sparked a high level of interest among investors. Globally the industry is predicted to reach $34.4 billion by end of 2015, largely due to the strong rise of Asia as a major crowdfunding region.Singapore as the region’s financial hub, is also gaining fast traction in the industry. The little red dot saw several new entrants to the crowdfunding scene this year, including the Singapore Exchange (SGX) and Clearbridge Accelerator, which in January unveiled a partnership to launch an equity-based platform, Sniffr.sg, a crowdfunding site for design entrepreneurs. Even telcos like StarHub has joined the...

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CapitaLand Commercial Trust declares 3.3% higher DPU of 2.19 cents for 1Q

CapitaLand Commercial Trust (CCT) has declared a distribution per unit (DPU) of 2.19 cents for 1Q 2016. This is 3.3% above the 1Q 2015 DPU of 2.12 cents. Based on the annualised 1Q 2016 DPU and CCT’s closing price per unit of $1.42 on Thursday, CCT’s distribution yield is 6.2%. The trust’s distributable income of$64.8 million in 1Q16 was 3.3% higher than the $62.7 million achieved in 1Q15. This was largely due to higher distributable income from its 40% and 60% interests in CapitaGreen and Raffles City Singapore respectively, said CapitaLand Commercial Trust Management, the manager of CCT. Gross revenue came in 1.9% lower at $66.9 million while net property income came...

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Keppel reports 41% fall in 1Q earnings to $211 million

Keppel Corporation reported a 41% fall in IQ earnings to $211 million, or 11.6 cents, from a year ago. Keppel said the higher contribution from its property division at 47% helped to partially offset lower profits from Offshore & Marine. Its Offshore & Marine division delivered three drilling jackups in IQ, including one unit to Gulf Drilling International at the start of the year. It also delivered a liftboat and a Transformer platform. Keppel said it is working closely with our customers for “winwin outcomes” wherever possible. Earlier this year, Transocean and Ensco have announced the deferment of their projects. Deliveries of two...

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6 things I learned from CapitaLand Commercial Trust’s FY2015 AGM

Singapore’s economic outlook for 2016 is modest despite challenges. The finance and insurance sectors are expected to support overall growth, and the manufacturing sector is likely to remain weak. Growth in labor-intensive sectors such as retail and food trades may be hampered due to labor constraints. Hence, office leasing demand is likely to be suppressed. In addition, there are also supply concerns with a large quantum of new office space expected to come on-stream within the next 12 months. Marina One, DUO, Guoco Tower are just a few of the many upcoming developments in 2016 that might pose as...

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MAS moves to protect Singapore’s economy with surprise easing

The Singapore economy grew at a respectable rate of 1.8% on a quarterly basis for Q1/2016 which was above analysts’ expectations of 1.6%. Despite the decent growth, the Monetary Authority of Singapore (MAS) surprised the market by announcing a new policy last Thursday to basically stop the appreciation of the Singapore dollar (SGD). The SGD immediately weakened against the USD and in the first hour alone, weakened 0.85% from S$1.3502 to S$1.3617 to one US dollar. The MAS has not made such a move since the 2008 Global Financial Crisis. This means, in my opinion, that the MAS foresees...

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5 important questions to ask when choosing an asset manager

You’ve probably heard about passive investing or ETF investing: If you can’t beat the market (and most people can’t), why not just buy the market? It’s a lazy way to invest but you do outperform many people because you’re essentially getting market returns. The recent boom in ETFs offer investors a multitude of choices to allocate their capital. You can invest in the well-known STI ETF (ES3 or G3B), S&P 500 ETF, various bond ETFs and even on triple leveraged (3x) Russia bull/bear ETFs. ETFs can offer anything from staid market indices to oil futures to fear itself (VIX...

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The 80/20 rule of fundamentals-based investing

For most people, value investing makes a lot of sense. Find a business worth a dollar and buy it for 50 cents. Easy enough. And yet, many people (even self-professed long-term investors) find it extremely challenging to implement this in practice. Investors routinely enter the market at high points, only to exit collectively at the low points. This isn’t for a lack of trying or expertise. Institutional behaviour is equally complicit in promoting this herd like mentality. There is no doubt in my mind that individuals armed with CFAs and MBAs working at investment management firms or brokerages are overwhelmingly...

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OSIM International: 6 Things I Learned from the FY2015 AGM

OSIM International (SGX: O23) has been in the news recently due to CEO Ron Sim’s offer to privatize the company at $1.32 a share — which he later raised to $1.39. In my previous article, I made the argument that OSIM is currently undervalued and is worth at least $1.47 a share. With that in mind, I decided to attend OSIM’s FY2015 AGM to gain some insight into the company and Ron Sim’s plans moving forward. Here are six things I learned from OSIM’s FY2015 AGM: 1. Drop in revenue is due to business cycles Ron Sim mentioned that...

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Asia’s ageing population drives demand for dividends

With the current birth rate and without immigration, Singapore’s population will begin to shrink around 2025. By 2030, there will only be 2.1 working-age citizens to support each citizen aged 65 and above. As such, of the “four Ds” impacting companies in Asia, we think Demographics will create opportunities for dividend investors. Global stock markets have been rocked by short-term volatility triggered by falling commodity prices and the start of the US Federal Reserve’s hiking cycle. Despite the more dovish comments, the Federal Open Market Committee remains in hiking mode, with its expectation for two rate increases this year...

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OSIM’s Ron Sim Raises Privatisation Offer to $1.39 a Share

OSIM International’s Chairman and CEO, Ron Sim, has raised his offer to buy the remaining 30.75% stake in the company he and his family do not own to $1.39 a share from $1.32 a share. The final offer price represents a premium of about 38.8% and 40.6% to the volume-weighted average price a share for the corresponding one-month and three month periods up to and including Feb 29, 2016, respectively. Shareholders who accept the offer will receive an amount that will be adjusted to reflect whether they have received the FY2015 final dividend of two cents a share, with effect from April 6, 2016, which is the...

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OSIM International: Why it’s Worth More Than Ron Sim’s Offer of $1.32 Per Share

Chairman and CEO of OSIM International, Ron Sim, announced on 7 March 2016 that he plans to take the company private and offer to buy out remaining shareholders at $1.32 per share – a 7.8% premium to OSIM’s last traded price of $1.225 on 1 March.  Shortly after the announcement, OSIM surged to $1.38 per share – six cents higher then Sim’s offer price.  It seems investors are valuing the company higher than Sim’s $310 million cash offer. OSIM traded as high as $2.90 per share in 2014 but fell to as low as 77 cents in the last...

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