Sunday, April 3, 2016

Recent Action - Hongkong Land

This will be a short update to the latest portfolio as I've recently added 1,500 shares of HK Land at a price of US$5.95.

For the benefit of those who had never of HK Land, they are one of the top 5 STI constituent in terms of market capitalization and a conglomerate which develops and manages commercial and residential properties across the globe - China, Singapore, Indonesia, Hongkong. Since they are a conglomerate with various businesses in many different countries, it is very difficult to value each of them accordingly, so I will be using a similar strategy to how I similarly did for Ho Bee recently.





In my last article (here), I've highlighted the main difference in the business model between Reits and developers. Obviously, we've seen very different fate in the market for Reits and developers over the recent years with many investors preferring Reits in their portfolio for income play. This has resulted in surged valuations from Reits which makes it a less compelling play than developers.

From a valuation stand point, I remain firm on my belief that they are an overlooked, unloved and compelling valuations that no one wants to touch. When they are unpopular, this is when I think they are worth a look.




I've tabulated the company's performance over the last 8 years and there are something which I am particularly looking out for.

In the table above, I have separated the company's earnings into the Total EPS (includes fair value change), Underlying EPS (exclude fair value change) and Recurring EPS (only rental income portion) and their relevant earnings yield. Since sales of their residential are more lumpy in nature, I am focusing more on their recurring income from their commercial properties. This is rather similar to how we have been trained to value Reits usually based on their recurring income.

If we take a look at the recurring income (green highlighted), which mainly focuses on the rental income and the recurring shares of profits from associates, we can see a positive uptrend in the last 8 years. The only time that it has seriously been jeopardized when it was in 2008 during the gfc when the economy was so bad. Back then, we also see an impairment being done to their properties for up to US$10m, but in all fairness it was minimal at best.

The company continues to trade at compelling valuations at price to book value of below 0.50x and an enticing dividend yield of around 3.2%. If this was structured like a Reit, then the company would be able to distribute dividends for as much as 6.4%, a very decent levered yield if you are considering the gearing they have (at 8%) compared to reits like CCT with dividend yield of 6.2% (gearing of 28%), FCOT with dividend yield of 7.2% (gearing of 38%) or Keppel Reit with dividend yield of 7.7% (gearing of 41%).

Most importantly, based on the company's recurring earnings yield, they would be more than comfortable to pay out the 19 cents dividends they have paid in the last 2 years.

The share price has recently weakened and I think for as long as their fundamentals remain solid as they are, it would be an easier decision for me to accumulate should the share price heads south.

Vested with 1,500 shares as of writing.

10 comments:

  1. B,

    Your radar is getting more and more advanced. Good job

    ReplyDelete
    Replies
    1. Hi SI

      Hahaha, it's been in my watchlist for a long time now, just never got a chance to get it with the limited funds I have.

      Delete
    2. Ass...saya tidak menyanka kalau saya sudah bisa sesukses ini dan ini semua berkat bantuan MBAH RAWA GUMPALA,saya yang dulunya bukan siapa-siapa bahkan saya juga selalu dihina orang dan alhamdulillah kini sekaran saya sudah punya segalanya,itu semua atas bantuan beliau.Saya sangat berterimakasih banyak kepada MBAH RAWA GUMPALA atas bantuan nomor dan dana ghaibnya,alhamdulillah kini saya sudah bisa membuka usaha kembali yang dulunya pakum karna masalah faktor ekonomi dan kini kami sekeluarga sudah sangat serba berkecukupan dan tidak pernah lagi hutang sana sini,,bagi anda yang punya masalah keuangan jangan sungkan-sungkan untuk menhubungi MBAH RAWA GUMPALA karna insya allah beliau akan membantu semua masalah anda dan baru kali ini juga saya mendaptkan para normal yang sangat hebat dan benar-benar terbukti nyata,ini bukan hanya sekedar cerita tapi inilah kisah nyata yang benar-benar nyata dari saya




      (((( BUKA BLO DANA GHAIB DAN NOMOR GHAIB MBAH RAWA GUMPALA ))))







      Ass...saya tidak menyanka kalau saya sudah bisa sesukses ini dan ini semua berkat bantuan MBAH RAWA GUMPALA,saya yang dulunya bukan siapa-siapa bahkan saya juga selalu dihina orang dan alhamdulillah kini sekaran saya sudah punya segalanya,itu semua atas bantuan beliau.Saya sangat berterimakasih banyak kepada MBAH RAWA GUMPALA atas bantuan nomor dan dana ghaibnya,alhamdulillah kini saya sudah bisa membuka usaha kembali yang dulunya pakum karna masalah faktor ekonomi dan kini kami sekeluarga sudah sangat serba berkecukupan dan tidak pernah lagi hutang sana sini,,bagi anda yang punya masalah keuangan jangan sungkan-sungkan untuk menhubungi MBAH RAWA GUMPALA karna insya allah beliau akan membantu semua masalah anda dan baru kali ini juga saya mendaptkan para normal yang sangat hebat dan benar-benar terbukti nyata,ini bukan hanya sekedar cerita tapi inilah kisah nyata yang benar-benar nyata dari saya.

      Delete
    3. How I Was Rescued By A God Fearing Lender {Lexieloancompany@yahoo.com}..

      Hello, I am Andrew Thompson currently living in CT USA, God has bless me with two kids and a lovely Wife, I promise to share this Testimony because of God favor in my life, 2days ago I was in desperate need of money so I thought of having a loan then I ran into wrong hands who claimed to be loan lender not knowing he was a scam. he collected 1,500.00 USD from me and refuse to email me since then I was confuse, but God came to my rescue, one faithful day I went to church after the service I share idea with a friend and she introduce me to LEXIE LOAN COMPANY, she said she was given 98,000.00 USD by MR LEXIE , THE MANAGING DIRECTOR OF LEXIE LOAN COMPANY. So I collected his email Address , he told me the rules and regulation and I followed, then after processing of the Documents, he gave me my loan of 55,000.00 USD... So if you are interested in a loan you can as well contact him on this Email: Lexieloancompany@yahoo.com or text +1(816) 892-6958 thanks, I am sure he will also help you.

      Delete
  2. Hi B,

    May I know where do you get your data from historical valuations/prices? (e.g. P/NAV, dividend yield)

    ReplyDelete
    Replies
    1. Hi Joel

      You can find these information in their AR.

      It's manual work, I don't trust any site until I verified it myself.

      Delete
    2. Thats a lot of work. Thanks for your thoughts

      Delete
  3. saya PAK SLEMET posisi sekarang di malaysia
    bekerja sebagai BURU BANGUNAN gaji tidak seberapa
    setiap gajian selalu mengirimkan orang tua
    sebenarnya pengen pulang tapi gak punya uang
    sempat saya putus asah dan secara kebetulan
    saya buka FB ada seseorng berkomentar
    tentang AKI NAWE katanya perna di bantu
    melalui jalan togel saya coba2 menghubungi
    karna di malaysia ada pemasangan
    jadi saya memberanikan diri karna sudah bingun
    saya minta angka sama AKI NAWE
    angka yang di berikan 6D TOTO tembus 100%
    terima kasih banyak AKI
    kemarin saya bingun syukur sekarang sudah senang
    rencana bulan depan mau pulang untuk buka usaha
    bagi penggemar togel ingin merasakan kemenangan
    terutama yang punya masalah hutang lama belum lunas
    jangan putus asah HUBUNGI AKI NAWE 085-218-379-259
    tak ada salahnya anda coba
    karna prediksi AKI tidak perna meleset
    saya jamin AKI NAWE tidak akan mengecewakan













    saya PAK SLEMET posisi sekarang di malaysia
    bekerja sebagai BURU BANGUNAN gaji tidak seberapa
    setiap gajian selalu mengirimkan orang tua
    sebenarnya pengen pulang tapi gak punya uang
    sempat saya putus asah dan secara kebetulan
    saya buka FB ada seseorng berkomentar
    tentang AKI NAWE katanya perna di bantu
    melalui jalan togel saya coba2 menghubungi
    karna di malaysia ada pemasangan
    jadi saya memberanikan diri karna sudah bingun
    saya minta angka sama AKI NAWE
    angka yang di berikan 6D TOTO tembus 100%
    terima kasih banyak AKI
    kemarin saya bingun syukur sekarang sudah senang
    rencana bulan depan mau pulang untuk buka usaha
    bagi penggemar togel ingin merasakan kemenangan
    terutama yang punya masalah hutang lama belum lunas
    jangan putus asah HUBUNGI AKI NAWE 085-218-379-259
    tak ada salahnya anda coba
    karna prediksi AKI tidak perna meleset
    saya jamin AKI NAWE tidak akan mengecewakan

    ReplyDelete
  4. How I Was Rescued By A God Fearing Lender (Lexieloancompany@yahoo.com)

    Hello, I am Andrew Thompson currently living in CT USA, God has bless me with two kids and a lovely Wife, I promise to share this Testimony because of God favor in my life, 2days ago I was in desperate need of money so I thought of having a loan then I ran into wrong hands who claimed to be loan lender not knowing he was a scam. he collected 1,500.00 USD from me and refuse to email me since then I was confuse, but God came to my rescue, one faithful day I went to church after the service I share idea with a friend and she introduce me to LEXIE LOAN COMPANY, she said she was given 98,000.00 USD by MR LEXIE , THE MANAGING DIRECTOR OF LEXIE LOAN COMPANY. So I collected his email Address , he told me the rules and regulation and I followed, then after processing of the Documents, he gave me my loan of 55,000.00 USD... So if you are interested in a loan you can as well contact him on this Email: lexieloancompany@yahoo.com or text +1(406) 946-0675 thanks, I am sure he will also help you.

    ReplyDelete
  5. Hi,

    I have a question on calculating your NAV.

    Do you just simply use the shareholders equity as your NAV?

    Also, for the breakdown of EPS, where did you get the data? Because I couldn't find in the AR..

    Do englighten me? Thanks a lot!

    Best regards,
    Eugene

    ReplyDelete

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