18Q4 Portfolio Updates

Just wanted to do a quick recap of my current portion my thoughts on the market for the next few months.

Initiated

No. Counter

Mkt Price

Shares

Mkt Value

 
1 ESR-REIT

0.52

17666

9,186

 
2 SingTel

3.05

2000

6,100

Added
3 StarhillGbl Reit

0.71

7000

4,970

New
4 Straits Trading

2.06

2000

4,120

 
5 Wilmar Intl

3.32

1000

3,320

 
6 Mapletree NAC Tr

1.24

2600

3,224

New
7 Mapletree Ind Tr

2.01

1600

3,216

New
8 CapitaR China Tr

1.48

2067

3,059

 
9 Keppel Corp

6.01

500

3,005

New
10. Raffles Medical

1.1

2060

2,266

 

Total

38,493

42,466

 

 

I sold off AIMS AMP CAP REIT when the sponsor bought the REIT manger and the price shot up. At a selling price of SGD 1.36, I broke even from my buy in price, though inclusive of dividends the return has been 11%.

I added several Reits during the last quarter’s bargain. On retrospect, the fed raising rates and backtracking in Jan was just what the market needed to get some perspective.

In Q4 2019, I added MNACT, MINT, Starhill and Keppel Corp.

MNACT had stated that rental reversions were double digit positive and I believe the location of Festival walk is strong. China’s tier 1 cities and Hong Kong are both ridiculously packed and malls generally do well. I wished I was gutsier to add more CRCT, but I thought I’d hedge my bets with MNACT.

MINT’s management has a very deep moat. I don’t think there are many industrial reit management teams that can do a full spectrum of AEI’s from warehouses to datacenters. I feel that this ability sets them apart from other small time industrial reits. The Taiseng acquisition is poised to become a gamechanger, especially with the nearby new town of Bidadari.

I was waiting for either Starhill or CDL-HT to fall further before acting, but it looks like prices have raced ahead for both. At a +6% yield and a lower PE and P/B ratio Starhill was the more conservative choice. I think most investors are feeling bullish on the upcoming Toshin rental. But I have not overlooked the positive announcements in Australia. This reit does not have a very strong moat in my opinion and I hope the price will appreciate enough before the Starhill gallery AEI.

Keppel Corp is an interesting story as the price tanked almost immediately after I bought on fears of low oil prices. I don’t think that Keppel like other pure property counter plays deserves to trade below NAV. I feel that LNG projects are the way forward for Keppel and I am optimistic that it would be able to snag a few deals in the next cycle. I think a consolidation of the Sembcorp and Keppel O&M would be a bonus, but it was not a consideration.

In the next 2 months, I am looking to add more Singtel and Raffles Medical, though I am keeping an eye out for further pricing erosion and China revenues respectively. I am also looking to divest some ESR as the balance sheet looks quite stretched. Let’s see if the market provides opportunities.

Lastly, let me end of with a reminder from Warren Buffet, try not to to listen to macroeconomic calls either when making individual stock decisions: “You cannot get rich with a weather vane.”

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