Portfolio - September 2019

With this, our portfolio update will be back on track :) StashAway update has been scheduled to be published tonight and the backlog will be our expenses update and travel posts.

Our portfolio decrease by 0.19% to $420,854 - $2,985.54 of capital withdrawal and $2,195.93 of capital gain. The one in blue is the StashAway portfolio, green is SGX and the total is in black.

If you prefer to look at numbers, this is the raw data used to generate the above bar graph. These numbers are as of the last day of the month.

"Cash Flow" is the amount of money being injected/withdrawn from the portfolio (buying stocks = +ve cash flow while selling stocks and collecting dividends = -ve cash flow)

SOLD
- APAC Realty (12,000 units) @ $0.51

After holding for an average of 391 days and collecting $870 of dividends, we have sold all our shares at a loss of -$2,631.95 which is about -17.6% and annualized -16.6%.

You can be right one moment and wrong the next. We first entered bought the stock (12,000 units @ $0.86) around 2 years ago (Oct 2017) - APAC Realty. Within 2/3 months, we were on 25% capital gain when the price went up to $1.08. Then came the cooling measure and it became a horror show (one of my top 5 worst investments) by the end of 2018 - Portfolio Performance in 2018. Along the way, we bought more 8,000 units @ $0.57 and sold them shortly @ $0.665.

Their latest quarterly result was simply too bad. Although revenue was just 28% lower, the profit had shrunk by 63%! The increase of 154% in marketing and promotion expenses wasn't translated to an increase in revenue shows a lot about the current property market sentiment... In addition, the depreciation of assets and finance costs due to the acquisition of a new property last year (wrong move) will be recurring, hence "eating" into the revenue. You can read more about it here in TTI's analysis - APAC REALTY – ACQUISITION OF ERA CENTRE IS CASHFLOW NEGATIVE.

It is no surprise that their EPS has also decreased by 62.4%. This meant that the previous dividends they had payout will no longer be sustainable and they have already reduced the latest dividends. I believe they will be cutting more, hence the decision to sell them now.

BOUGHT
- Soilbuild REIT (6,000 units) @ $0.53

Nothing new, I blogged about this previously - Soilbuild Business Space REIT (Not) Bad Preferential Offering. We were given 2,700 rights which I exercised all of them, applied in excess another 3,300 and were given full allocation.

There were 2 other companies that had issued rights and I shall give a quick update on the actions we took:
Keppel DC REIT - Exercised and oversubscribed
Chip Eng Seng - Letting it expire because of issues in corporate governance. You can read more about it here - Corporate governance: More teeth and substance needed. In addition, the exercise price >= market price which makes it pretty unattractive and the rights worthless. I could not even sell it in the market.

Dividends
The total dividends collected this month is $164.29. The breakdown is as follows:

Company	Symbol	ExDate	Shares	Total
Keppel DC REIT	AJBU	23-Sep-19	3,000	$54.29
OUE Limited	LJ3	11-Sep-19	11,000	$110.00

Total dividends collected for 2019: $15,744.85
Average dividends per month for 2019: $1,749.43

StashAway

KPO

CZM

Capital: $23,000.00
Current: $‭25,510.69‬

You might be interested in previous months update too:
- Portfolio Performance in 2018 - $354,145
- Portfolio - January 2019 - $376,381
- Portfolio - February 2019 - $379,814
- Portfolio - March 2019 - $400,263
- Portfolio - April 2019 - $400,263
- Portfolio - May 2019 - $392,934
- Portfolio - June 2019 - $415,611
- Portfolio - July 2019 - $420,798
- Portfolio - August 2019 - $421,644
- Portfolio - September 2019 - $420,854

Do like any of the following for the latest update/post!
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4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)

Soilbuild Business Space REIT (Not) Bad Preferential Offering

I received an SMS earlier today from SCB - corporate action.

The first thing that came to mind was will this be dilutive or accretive? You should be able to guess it from the title of my post. To be honest, I have not been keeping up with the market news so this is new to me. Went to dig through the announcement and wanted to do a quick summary.

Soilbuild REIT will be acquiring a new Grade A office building in Australia - 25 Grenfell Street, Adelaide for A$134.22 million (S$127.51 million) but will be paying approximately A$142.01 million (S$134.91 million) due to various fees, out of which S$101.8 million will be raised through this preferential offering.
Every 18 New Units will be issued for every 100 existing units in Soilbuild REIT (the “Units”) held as at 5.00 p.m. on Thursday, 29 August 2019 to Eligible Unitholders (as defined herein) (fractions of a New Unit to be disregarded) at an issue price of S$0.530 per New Unit.

Let's take a look at the illustrated Pro Forma DPU and NAV. Focus on Scenario B and also note that these are illustrated numbers assuming acquisition happened in 2018.

Decreased in DPU.

Decreased in NAV. Only OUE REIT can do better worst? If we were to look passed the DPU and NAV dilution, this may actually be a decent/good move for Soilbuild REIT...

Let's face it, Soilbuild REIT's DPU has been declining over the years after facing a few defaults (NK Ingredients and Technics Oil and Gas), decreased occupancy and negative rental reversions. As a result, this preferential offering has minimum damage but actually improves its portfolio (out of Singapore + Grade A office building vs its existing industrial buildings).

In my 5 minutes researching time, I believe Soilbuild did not overpay for the building. Credit Suisse put it up for sale earlier this year and it was speculated to be worth as much as A$150 million - Credit Suisse to check out of Adelaide tower.

Their latest 1H financial results are already showing clear signs of declining DPU by another ~10%. Assuming we extrapolate the DPU for FY 2019, it will be 4.628. At an issue price of $0.53, that translates to 8.7% dividend yield for an existing shareholder. If you choose not to subscribe, you will just be diluted and since this is a non-renounceable offering, you cannot even sell the rights. In another word, you are stuck. Just exercise it :)

On the bright side, depending on your entry/average price, this may not be a bad offer for you. In my case, my average price was very high ($0.701) and it became accretive if the calculations are based on cost/average price. Needless to say, I will exercise all of them and apply in excess!

You can use my google spreadsheet/calculator to see how would this rights issue work out for you - KPO Rights Issue Calculator

Fun fact: Soilbuild REIT is buying the building from Credit Suisse who bought the at A$125 million in 2016. They made A$9 million in just 3 years!

References:
- PROPOSED ACQUISITION OF 25 GRENFELL STREET, ADELAIDE, AUSTRALIA
- LAUNCH OF FULLY UNDERWRITTEN PREFERENTIAL OFFERING TO RAISE GROSS PROCEEDS OF APPROXIMATELY S$101.8 MILLION
- 25 Grenfell St, Adelaide CBD, sells for $125 million to Credit Suisse

Do like any of the following for the latest update/post!
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2. Twitter - KPO and CZM
3. Click here to subscribe using email :)
4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)

Portfolio Update - January 2018

Our portfolio increase by 7.24% to $317,607 - $11,017.22 of capital injection and $10,431.30 of  capital growth.

The year started with a BANG and within the first week, our portfolio crossed the next 100k milestone to $300,000.

SOLD
- Soilbuild Business Space REIT (15,000 units) @ $0.705

Soilbuild Business Space REIT was one of our biggest holdings with 30,000 units. It has been hit with a series of unfortunate events, one after another. Apart from the 2 defaults, the latest bad news is that their property has been revalued down. Based on the latest 4QFY17 results, NAV decreases from $0.72 to $0.64 which meant that it is trading at a premium. DPU decreases by 6.2% YoY even though NPI increases. We are no longer willing to take the risk of capital loss, lower DPU, and uncertainties. Hence, we decided to sell half of it. Selling it before XD means giving up $0.01383 of dividends but we are expecting the price to drop below $0.69 after XD and it sure did.

BOUGHT
- ThaiBev (6,000 units) @ $0.92
- Geo Energy (7,000 units) @ $0.265
- Wilmar (2,000 units) @ $3.19
- Ascendas H-Trust (9,000 units) @ $0.895

I have blogged about ThaiBev and Ascendas H-Trust separately. Do refer to those articles for more information. We purchased Geo Energy October last year and decided to buy more for the same reason. We bought Wilmar because it is one of the stock that did not/yet to run up in the bullish market, it is currently trading at PE ~10-11+ which is significantly lower than the others (e.g. Olam). We believe that there is definitely room for capital gain while waiting patiently and collecting ~2% of dividends.

Dividends
The total dividends collected this month is $642.95. The breakdown is as follows:

Company	Symbol	ExDate	Shares	Total
CapitaLand Commercial Trust	C61U	31-Jan-18	2,000	$82.00
CapitaLand Mall Trust	C38U	30-Jan-18	7,000	$203.00
Soilbuild Business Space REIT	SV3U	26-Jan-18	15,000	$207.45
First Real Estate Investment Trust	AW9U	23-Jan-18	7,000	$150.50

Total dividends collected for 2018: $642.95
Average dividends per month for 2018: $642.95

StashAway

Capital: $4,000
Current: $4,048.22 (IRR: 2.6%)

USD has been falling significantly which resulted in the high negative currency impact. Overall absolute return is now lower than STI ETF based on our spreadsheet - KPO & CZM StashAway Portfolio VS STI ETF.

Do take a look at this article if you missed it - StashAway Clarifications - Reward-to-Risk Ratio where Freddy Lim (Co-Founder & Chief Investment Officer of StashAway) clarify how StashAway is optimizing return by taking on lesser risk.

StashAway Referral Link for Our Readers
Here you go: KPO and CZM Referral Link

Health - KPO Needs to Lose Weight
Date: 2018-02-03
Weight: 71.4 kg (Lost close > 10 kg already!)

BMI: 23.8

Do like any of the following for the latest update/post!
1. FB Page - KPO and CZM
2. Twitter - KPO and CZM
3. Click here to subscribe using email :)

Portfolio Update - Apr 2017

Our portfolio grew by 9.25% this month (through both capital injection and capital gain) bringing it to $236k! Total capital injection YTD (Year Till Date) is $57,818 and capital growth of $11,349. With that we have exceeded our target/goal for the year and we are on track to our 1 million portfolio in 10 years time - refer to Our Goals.

For the month of April, we bought 1 stock (GuocoLand) and subscribed to Ascott REIT rights issue. GuocoLand has a NAV of $2.96 and has been paying dividends ($0.05/$0.08) over the years. This stock was brought to my attention by one of AK's blog post where he gave a detailed analysis over here - Invested in Guocoland with Mr. Quek Leng Chan.

I fully subscribe to Ascott REIT 1,450 rights issue and over subscribe/allocated another 1,150 shares. Based on my last analysis on the rights issue, I was previously sitting on a loss of -$395.62 (-6.66%). However, as of the last closing price ($1.11), I am currently sitting on a gain of +325.98 (+3.91%). That is how it is, up and down, there is no need to be too affected by the volatility of the stock price.

BOUGHT

- GuocoLand (9,000 units) @ $1.85

- Ascott REIT (2,600 units) @ $0.919 [Total units: 7,600 units]

The total dividends collected this month is $678.40. The breakdown is as follows:

- CapitaLand Mall Trust - $81.90

- First REIT - $149.80
- Soilbuild Business Space REIT - $446.70

Total dividends collected for 2017: $2771.01
Average dividends per month for 2017: $230.92

[Sneak Peek] May will be an excellent month for dividends! StocksCafe is showing me $1,183.75 as of now xD

Portfolio Update - Feb 2017

I just realized our blog has reached its first tiny milestone - 1,000 page views! Thank you everyone!

We are proud to announce that we have hit our 1st short term goal this month - our portfolio is now greater than $200,000 :) With that, we have applied to become Standard Chartered Priority Customer. That means we have lower commissions (0.18% as compared to 0.20% previously) and most importantly, the minimum commission of $10 no longer apply. One of our strategy is to use DCA (dollar cost averaging) to buy 1 lot (1000 units) of STI ETF every quarter and we were quite annoyed by the fact that we will have to pay the $10 (KPO mentality) so we sort of put it on hold back then when it was around $2.9X >.<

February is the month where both of us got our bonuses for slogging our lives away for the past year. Hence, we had more $$$ than usual and invested $15,000 in the followings:
- Raffles Medical (4000 units)
- Soilbuild REITS (10,500 units)
- Sheng Siong (3000 units)

We decided to buy more Raffles Medical because its price fell further since we last bought it. However, after we bought it, it fell even more >.< Before buying more Soilbuild REITS, my average price was around $0.733. I decided to average down and at its current price ($0.645), there is definitely room for capital growth (NAV $0.72) and dividend yield is around 9%. Both our parents did not receive any phone call when they were watching 缤纷万千在昇菘 The Sheng Siong Show for the past few weeks. As their son/daughter, we learnt from their mistakes and buy more of the shares to collect dividends instead. Ignoring the above investment, our portfolio grew by about 1.8% this month. Not too bad but I am expecting next month to be bad because interest hike is coming to town again. All my REITs will bleed...

The total dividends collected this month is $1,170.11. The breakdown is as follows:
- STI ETF: $424
- Croesus Retail Trust: $234.82 (I chose DRIP instead)
- OUE Commercial REIT: $200
- Far East Hospitality Trust: $112
- Starhill Global REIT: $88.20
- Viva Industrial Trust: $41.28
- Singapore Post: $35
- Lippo Malls Indonesia Retail Trust: $34.80

Total dividends collected for 2017: $1,931.36
Average dividends per month for 2017: $160.95 

Portfolio Update - Jan 2017

Happy Chinese New Year!!

Hope everyone got big ang bao!

January has always been a good month because lots of company will be declaring dividends! Total dividends is $761.25 (based on XD Date) contributed by First REIT, CMT, Soilbuild REIT and Ascott REIT. You can refer to the exact breakdown here.

I have also added 2 new stocks - Ascott REIT and Raffles Medical which brings our investment to $184k! Another $15k and we will be able to become SCB priority customer with no minimum commission! I had to sell off some CNAV stocks that are illiquid/with extremely low volume before SCB implemented thier new commission structure last year.

The reason why I buy those stocks? I prefer REIT that are undervalued (PB < 1, price < NAV, etc.) because I can collect dividend while waiting for them to hit NAV. An example is Saizen REIT which gave me about 50% return when they got bought over last year! As for Raffles Medical, I just wanted to diversify slightly and was looking at healthcare stocks.

On a side note, CZM is very lazy. She seems to have lost interest already. I guess there will be a lot more posts on money than food. Lol.