On 16/4/18, I bought into Ascendas Hospitality Trust at $0.80, and thus will be receiving its $0.0313 dividend later this month. Its shares took a beating recently, and drew my attention as a result. Being in the hospitality industry, its revenues and earnings would tend to fluctuate more as compared to more resilient sectors like healthcare or retail. However, I am attracted to its portfolio of freehold properties in Australia, Japan and now Korea. In the past few months, it has also successfully sold off its China portfolio at a large premium of 178% over its purchase price. This gives me an indication of the capability and foresight of its management. At a NAV of $0.92, my purchase price is at a discounted PB of 0.87 and a yield of ~7%. I do not expect its yield to remain elevated in the future, as it will be returning some of the proceeds back from its China disposal this quarter and future revenue will likely be lower as well. On 11/5/18, I bought into APAC Realty at $0.99. Similar to AHT, its continuous drop in share price within a short period of time prompted me to look further into its business. I found its fundamentals to be strong, and its outlook positive. APAC Realty owns ERA Realty Network, which is one of the biggest property agencies in Singapore. Its revenue and earnings have been growing strongly in the past year, and there is a high possibility of that being superceded this year due to a greater number of units being launched as compared to last year (11,000 vs 4,800). The current property cycle in Singapore is rather bullish, although my personal opinion is that it will not last long. At my purchase price of $0.99, APAC Realty was trading at a ex cash PE of ~10. It is also net cash, a trait that I have always liked. Valuations are definitely not cheap, but I feel that I’m paying a fair price for a good business. However, as its business ebbs and flows with the property cycle, a buy and hold approach might not be the best. I will definitely have to keep a lookout for signs that the cycle is turning in this case.
On 13/4/18, I sold off my stake in Jumbo Group at $0.555, making a loss of 6.14% after accounting for dividends. In its recent quarters, its profits were not growing as fast as I thought to justify its PE. I believe Jumbo Group will continue to exhibit slow growth as it incurs startup costs in its various ventures. It is indeed a long term play, but as I felt there were better opportunities out there in the market, I decided to reallocate my funds.
*On 4/4/18, I further increased my stake in HRNet Group at $0.715 as I still believe in its fundamentals. On 27/4/18, I also bought more into Valuetronics at $0.77 as I felt the selling was overdone, likely in response to its key customer’s falling sales. On 28/5/18, I followed up my purchase in APAC Realty at $0.905 when its shares dipped further.
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.