04 JANUARY 2013
SI Portfolio Beats The STI For The Fourth Consecutive Quarter; Up 43.5% YoY
By Jade Lee, Louis Lee, and Nicholas Tan
We have seen many things happen in 2012 from the re-election of President Obama, the Eurozone debt crisis that is continuing to weigh its negative influence on markets to China’s slowdown. Nevertheless, the Straits Times Index (STI) still managed to perform pretty well this year, with a total return of 19.7 percent (as at 31 December 2012) as compared to the Dow Jones Industrial Average (DJIA) (+7.3 percent).
So how did our SI Portfolio fare after all?
Since the start of 2012, our SI portfolio has been outperforming the STI for each cumulative quarter. At present, we are happy to say that we have beaten the STI for four consecutive quarters, and have generated a total return on the portfolio of 43.5 percent (inclusive of dividends) as at 31 December 2012.
For the fourth quarter, our top three performing stocks are Super Group Holdings, Global Logistics Properties and Ezion Holdings.
Super Group Roars In Share Price Gains
Super Group has generated a return of more than 140 percent. It continues to be fuelled by its strong market leader position across fast-growing Asean markets, strong diversified geographical reach, and higher product sales.
In its latest 9M12 results, Super reflected a 49.7 percent increase in earnings as a result of increased sales revenue and higher gross profit, which arose from its operational efficiency and effective cost management. This double digit growth in earnings was despite macro-economic uncertainties, which stems its resilience and highlights its robust business model. Its branded consumer sales continue to see upside performance as sales from this segment is typically stronger in the second half of the year following festive seasons.
Although we feel that raw material costs are expected to fluctuate in the next 12 months, we feel that Super has been traditionally strong in mitigating such exposures. As at 30 September 2012, Super has a healthy balance sheet with cash and bank balances of $72 million.
Ezion Brings In Strategic Investors To Pursue Growth Strategy
Ezion Holdings’ share price hit a historical high to end the year at $1.69, substantiating a 156.1 percent gain since the beginning of 2012. Notably, Ezion’s share price for the fourth quarter continued its ascend and climbed 25.7 percent on the back of news that strategic investors were roped-in to back its growth strategy.
Most recently, in as many months, Ezion announced its second strategic placement. EDB Investments (EDBI), the corporate investment arm of Singapore’s Economic Development Board subscribed to approximately 14.3 million new ordinary shares and injected $19 million into Ezion to grow competitive businesses to build sustainable industry pillars for Singapore. In our view, the backing of an esteemed partner like EDBI signals a positive vibe for the industry and will allow Ezion to leverage on EDBI’s extensive network of resources and vast experience to further expand its business in the vibrant offshore oil and gas industry.
In November 2012, Ezion successfully raised $12.5 million following the acquisition of 10 million new shares by industry veteran Tan Boy Tee. Having more than 30 years of experience in marine construction and engineering, we believe the engagement of Tan as a strategic partner and ad hoc advisor will help the firm in securing more new projects.
In addition, the company’s joint venture with Kim Seng Holdings had secured US$298 million worth of contracts to provide two service rigs over a seven year period to support the oil and gas activities of a national oil major in Central America, which will lead to earnings accretion from 1Q13 onwards. Its recently acquired stake (44 percent) in YHM, a company engaged in the scaffolding business catering to the construction and marine industries, also reflects a synergistic approach by Ezion to complement its current business.
GLP J-REIT Joins TSE; Likely Higher Yield Payout Than TSE REIT Index
Modern warehouse provider GLP, which announced several big moves for the past couple of months, has seen its share price jumped 10.8 percent for the three months ended 31 December 2012, further translating into a whopping 58.9 percent jump since beginning of the year.
Of the recent moves, the disposal of its 30 properties in Japan to set up a real estate investment corporation in Japan (GLP J-REIT) once again caught our eyes. In fact, the deal was earnings accretive with net profit contribution of around US$102 million, representing approximately 23 percent of GLP’s consolidated net profits for the year ending 31 March 2012.
In view of the bleak Japanese economy, the listing of GLP J-REIT has unavoidably raised concern of continued buying interest. Yet, a comforting note is that the Bank of Japan has been buying REITs since 2010 as part of a 76 trillion yen (US$110 billion) asset fund to support its economy. Moreover, Japan REIT Index has gained 33.6 percent in 2012 and is set for its largest gain since at least 2004.
The scarcity of modern warehouse in Japan would also further substantiate GLP J-REIT’s business rationale in the near future. Notably, Takeshi Akagi, head of research and advisory for Jones Land Lasalle mentioned that the demand for modern warehouses has been set to rise as more companies were outsourcing logistics business to cut costs and the volume of internet shopping traffic was increasing. To date, GLP owns 15 percent interest in GLP J-REIT and will act as the property and asset manager of the REIT.
Meanwhile, GLP J-REIT plans to enhance shareholders’ payout with money that Japanese REITs usually set aside to cover depreciation expenses. According to the forecast provided by GLP, GLP J-REIT’s dividend yield in August 2013 has been lifted from 6 percent to approximately 6.8 percent based on the indicative price of 60,500 yen, as compared to average dividend yield for Tokyo Stock Exchange (TSE) REIT Index of 4.7 percent. This could potentially attract both local as well as international investors seeking high yield investments.
Conclusion
As we move into the first green patch of 2013, we are thankful for the gains that have been reaped in 2012. Although we have beaten the STI by a good 23.9 percentage points, we are humbled by such performance on our portfolio, as 2012 has indeed been a year that has seen many different things which could break the market in a finger snap. Moving forward, we will continue searching for stock gems in 2013 for you!
Source/Extract/Excerpts/来源/转贴/摘录: www.sharesinv.com
Publish date: 04/01/13
SI Portfolio Beats The STI For The Fourth Consecutive Quarter; Up 43.5% YoY
By Jade Lee, Louis Lee, and Nicholas Tan
We have seen many things happen in 2012 from the re-election of President Obama, the Eurozone debt crisis that is continuing to weigh its negative influence on markets to China’s slowdown. Nevertheless, the Straits Times Index (STI) still managed to perform pretty well this year, with a total return of 19.7 percent (as at 31 December 2012) as compared to the Dow Jones Industrial Average (DJIA) (+7.3 percent).
So how did our SI Portfolio fare after all?
Since the start of 2012, our SI portfolio has been outperforming the STI for each cumulative quarter. At present, we are happy to say that we have beaten the STI for four consecutive quarters, and have generated a total return on the portfolio of 43.5 percent (inclusive of dividends) as at 31 December 2012.
For the fourth quarter, our top three performing stocks are Super Group Holdings, Global Logistics Properties and Ezion Holdings.
Super Group Roars In Share Price Gains
Super Group has generated a return of more than 140 percent. It continues to be fuelled by its strong market leader position across fast-growing Asean markets, strong diversified geographical reach, and higher product sales.
In its latest 9M12 results, Super reflected a 49.7 percent increase in earnings as a result of increased sales revenue and higher gross profit, which arose from its operational efficiency and effective cost management. This double digit growth in earnings was despite macro-economic uncertainties, which stems its resilience and highlights its robust business model. Its branded consumer sales continue to see upside performance as sales from this segment is typically stronger in the second half of the year following festive seasons.
Although we feel that raw material costs are expected to fluctuate in the next 12 months, we feel that Super has been traditionally strong in mitigating such exposures. As at 30 September 2012, Super has a healthy balance sheet with cash and bank balances of $72 million.
Ezion Brings In Strategic Investors To Pursue Growth Strategy
Ezion Holdings’ share price hit a historical high to end the year at $1.69, substantiating a 156.1 percent gain since the beginning of 2012. Notably, Ezion’s share price for the fourth quarter continued its ascend and climbed 25.7 percent on the back of news that strategic investors were roped-in to back its growth strategy.
Most recently, in as many months, Ezion announced its second strategic placement. EDB Investments (EDBI), the corporate investment arm of Singapore’s Economic Development Board subscribed to approximately 14.3 million new ordinary shares and injected $19 million into Ezion to grow competitive businesses to build sustainable industry pillars for Singapore. In our view, the backing of an esteemed partner like EDBI signals a positive vibe for the industry and will allow Ezion to leverage on EDBI’s extensive network of resources and vast experience to further expand its business in the vibrant offshore oil and gas industry.
In November 2012, Ezion successfully raised $12.5 million following the acquisition of 10 million new shares by industry veteran Tan Boy Tee. Having more than 30 years of experience in marine construction and engineering, we believe the engagement of Tan as a strategic partner and ad hoc advisor will help the firm in securing more new projects.
In addition, the company’s joint venture with Kim Seng Holdings had secured US$298 million worth of contracts to provide two service rigs over a seven year period to support the oil and gas activities of a national oil major in Central America, which will lead to earnings accretion from 1Q13 onwards. Its recently acquired stake (44 percent) in YHM, a company engaged in the scaffolding business catering to the construction and marine industries, also reflects a synergistic approach by Ezion to complement its current business.
GLP J-REIT Joins TSE; Likely Higher Yield Payout Than TSE REIT Index
Modern warehouse provider GLP, which announced several big moves for the past couple of months, has seen its share price jumped 10.8 percent for the three months ended 31 December 2012, further translating into a whopping 58.9 percent jump since beginning of the year.
Of the recent moves, the disposal of its 30 properties in Japan to set up a real estate investment corporation in Japan (GLP J-REIT) once again caught our eyes. In fact, the deal was earnings accretive with net profit contribution of around US$102 million, representing approximately 23 percent of GLP’s consolidated net profits for the year ending 31 March 2012.
In view of the bleak Japanese economy, the listing of GLP J-REIT has unavoidably raised concern of continued buying interest. Yet, a comforting note is that the Bank of Japan has been buying REITs since 2010 as part of a 76 trillion yen (US$110 billion) asset fund to support its economy. Moreover, Japan REIT Index has gained 33.6 percent in 2012 and is set for its largest gain since at least 2004.
The scarcity of modern warehouse in Japan would also further substantiate GLP J-REIT’s business rationale in the near future. Notably, Takeshi Akagi, head of research and advisory for Jones Land Lasalle mentioned that the demand for modern warehouses has been set to rise as more companies were outsourcing logistics business to cut costs and the volume of internet shopping traffic was increasing. To date, GLP owns 15 percent interest in GLP J-REIT and will act as the property and asset manager of the REIT.
Meanwhile, GLP J-REIT plans to enhance shareholders’ payout with money that Japanese REITs usually set aside to cover depreciation expenses. According to the forecast provided by GLP, GLP J-REIT’s dividend yield in August 2013 has been lifted from 6 percent to approximately 6.8 percent based on the indicative price of 60,500 yen, as compared to average dividend yield for Tokyo Stock Exchange (TSE) REIT Index of 4.7 percent. This could potentially attract both local as well as international investors seeking high yield investments.
Conclusion
As we move into the first green patch of 2013, we are thankful for the gains that have been reaped in 2012. Although we have beaten the STI by a good 23.9 percentage points, we are humbled by such performance on our portfolio, as 2012 has indeed been a year that has seen many different things which could break the market in a finger snap. Moving forward, we will continue searching for stock gems in 2013 for you!
Source: Compiled by Shares Investment
Inclusive of dividend received from OCBC ($0.31), Keppel Corp ($0.44), ComfortDelgro ($0.062), M1 ($0.145), Olam ($0.04), GLP ($0.03), Ezion ($0.001), Cordlife Group ($0.018), Q&M ($0.00675), Super Group ($0.058), Sound Global ($0.01), OKP Hldgs ($0.02), LippoMalls ($0.0274).
The information contained in the factsheet does not constitute a recommendation to buy or sell securities, and is used solely for illustrative purposes only.
The information contained in the factsheet does not constitute a recommendation to buy or sell securities, and is used solely for illustrative purposes only.
Source/Extract/Excerpts/来源/转贴/摘录: www.sharesinv.com
Publish date: 04/01/13
No comments:
Post a Comment