Sale of GLP & Purchase of Addvalue Tech

As news about GLP’s buyout continued to surface and finally seemed to have reached an agreement, I realised that I did not blog about the sale of my shares earlier. On 19/5/17, I sold off my shares at a price of $2.91, giving me a gain of ~31% based on my earlier purchase price of $2.20. I sold my shares as I felt there was still much uncertainty about the buyout price, and the risk-reward ratio was getting less attractive with the surge in its share price. Nevertheless, although I feel it is indeed a strong company to hold for the long term, this buyout offer did give me a good return and I am grateful for that. On hindsight, I should have waited (the final offer price was $3.38, not inclusive of dividends!), but we always have to make the best decision we can at that point of time. Just like in a game of poker. ūüėȬ†On 15/7/17, I continued to add to my investment in ISEC Healthcare at $0.33, as I feel it is still undervalued as compared to the industry. I had wanted to add more at $0.315 but was greedy and decided to queue at $0.31 instead. Unfortunately, my bid did not get through. At $0.33, its absolute PE is still high, but I am rather optimistic about this. Let’s visit this space again in time to come.

 

On 21/7/17, I bought into Addvalue Tech at a price of $0.049. I feel the risk reward ratio is attractive to me at the current price, and the recent entry into the Thai market for its iFleetONE products is good progress. Catalysts remain the sale of its subsidiary Addvalue Communications, contract wins for its iFleetONE product and commercialisation of its Inter-Satellite Data Relay System. Nevertheless, the firm has been loss making for the last few years, and it might take some time before the numbers are back in the black again. This is a speculative position, and I will consider selling if losses continue and their business divisions do not show signs of growth. As this is still not my typical kind of investment, my stake is very small. Position sizing is very important in portfolio management.

 

Disclaimer: The author owns shares in the abovementioned company. The ideas expressed in this blog should not be construed as an enticement to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Purchase of Spackman Entertainment, Jumbo Group & GLP

spackman-entertainment-groupOn 5/12/16, I bought into Spackman Entertainment at $0.143. For me, Spackman Entertainment is a catalyst play for the short term. There are a number of catalysts that I felt presented an attractive risk to reward ratio. The most important one would be¬†that it had divested its loss-making asset Optus Pictures Limited, which should drive costs much lower. I have always viewed¬†divestments of continuously loss-making businesses in a positive light – it shows management’s willingness to adapt and focus on its more profitable assets, a strategy¬†I believe will reward investors in time. Keeping and focusing on the more profitable Zip Cinemas which boasts a stronger track record of hits is a good call. The company has also a 27.2% share ownership in Spackman Media group, South Korea’s largest entertainment agency, which analysts believe to be worth around US$45 million, approximately around its current market capitalization. However, my take is still to view analysts opinions conservatively so I am not banking on this valuation alone. Nevertheless, any move to create value for shareholders is always welcomed. The last catalyst would be the release of the highly anticipated movie “The Masters”, premiering this month. There has been alot of hype and buzz around this movie due to its list of A-listers starring in the show. I am however, more interested and attracted to the former two catalysts as the movie business is volatile in nature and¬†it is hard to¬†know whether the movie will actually do well. Nevertheless, I have caught one of the movies made by Zip Cinemas – “My Brilliant Life” and was quite impressed by it. Let’s see how this catalyst play works out in time to come.

 

jumbo-group-facebookOn the same day, I also bought into Jumbo Group at $0.64. I have always wanted to own shares in Jumbo since its IPO, but the price never went to a level which was attractive enough for me. At the current price, I still feel it is not undervalued but rather more towards being fairly valued. The reason why I chose to invest at its current high is because I am a firm believer of its scalable business model, and its opportunity for growth in the future. Its brands sell high quality food and its business is able to produce respectable margins and ROEs in a very very competitive industry. The bad part about waiting to purchase a solid stock at an attractive price is when the business continues chugging along and demanding higher valuations. I rather accumulate now slowly and continue to buy more when opportunities present itself along the way, than to miss the boat altogether. I view this investment as a long term holding.

global_logistics_propertiesMy final purchase of the day was into GLP at $2.20. Over the past 3 weeks, I have been tracking GLP and was contemplating buying it when it was around $2.00. Nevertheless, due to my indecision, I missed the mini rally of its shares. My reason for buying GLP is simple Рit is a market leader in its business, the logistics industry is growing, its asset management arm seems promising and its price is fair. Recently, GLP is undertaking a strategic review of its business to enhance shareholder value after prompting by GIC. I am not sure what will result from this review but I remain confident that GLP will continue to grow in the future. Its asset management arm is something that I am rather optimistic of, as it reminds me of the strong business model that ARA possessed. Being a property developer and asset manager allows it to recycle its funds and earn recurring fees at the same time. Although I am not a big fan of property developers, its asset management arm gives me some comfort in knowing that there is an element of recurring revenues and growth as its AUM grows. I will continue to track the ongoings of this company going forward.

Finally, on 8/12/16,¬†I increased my stake in ISOTeam at a purchase price of $0.385. I remain optimistic about the company’s growth and my thesis remains the same.¬†With my recent purchases, my portfolio is around 40% invested in the stock market. I am still tracking a few more stocks but currently am¬†contented just waiting.

 

Disclaimer: The author owns shares in the abovementioned company. The ideas expressed in this blog should not be construed as an enticement to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.