Welcome to my investment blog where I share with you my analysis of REITs in Singapore.

I hope that my investment philosophy will bring me a steady stream of income apart from my job. I am aiming for at least $3,000 per month which can sustain the current expenses of myself and my family.

Do enjoy reading my blog and post any comments that you have. I welcome them because it is a time to learn from each other.

When I am looking at investing in REIT, here are some of the guidelines that I am looking at. Feel free to comment on it. I am willing to listen to ideas.

-> at least 8% yield.
-> Price that is lower than its NAV.
-> Low gearing (if possible)
-> High secured NAV.

Current Dividend income is $1,160/month.



Monday, March 2, 2015

Analysis of Macquarie International Infrastructure Fund (Miif)

Current Price on 26th Feb 2015 = $0.097
  • Yield = 9.28%  
  • Price-to-book Ratio = 0.776
  • Assets per unit = $0.132
  • Debt per unit = $0.007 (including current liabilities)
  • Gearing = 5.4%
  • Secured NAV = $0.125 (128% of trading value)
Macquarie International Infrastructure Fund is one counter which consist of only one asset i.e. an expressway in China and is in the process of looking at opportunities to divest and wind up the company. They reported their results recently.

Since they have not sold it, I am going to take it that it will continue to exist. And its yield is quite good at 9.28%. Since it is going to wind up soon, we look at the NAV which shows very good sign. Firstly, price-to-book ratio is only 0.776. This means we are looking at about 22% discount. Moreover, it does not really have debt so it is fully owned by you. Thus the Secured NAV is 128% of the trading price.

I believe that they are trying very hard to sell at a fair price so I am going to assume that their NAV is $0.125 and I am going to get $0.125 per share back. Thus, I believe this is going to be a good deal to earn 22% more in capital. Even if they take longer to wind up, they will still need to pay dividends which is currently at 9.28%.

Patience is the key and I am considering putting money into this. If it does not wind, good. If it winds up, it should be better.

Thursday, February 26, 2015

Analysis of Global Investment Limited (Non-REIT)

Current Price on 24th Feb 2015 = $0.15
  • Yield = 10.00%  
  • Price-to-book Ratio = 0.699
  • Assets per unit = $0.216
  • Debt per unit = $0.001 (including current liabilities)
  • Gearing = 0.5%
  • Secured NAV = $0.145 (96% of trading value)
Global Investment Limited reported their results before CNY with results that I thought was just ok. Their dividend stays the same at $0.0075 (for 6 months) which translates to a 10.00% yield. Not bad. Moreover, their price-to-book ratio is only 0.699 which means you are buying it at a 30% discount.

One thing to note is the trading price which I watch closely as it reflects on the strength of the counter. At $0.15, I think the pricing is a bit on the low side as I am expecting $0.152. The reason is that for the past few half-years, they have gone XD at $0.145 quite consistently. With the current development, it may go below $0.145 or even beyond $0.14.

I am vested with more than 560,000 shares valued at $82,000. This is THE anchor investment that I have which have consistently gave me good returns more in the form of dividends. I have been participating in their reinvestment plans so my yield is much higher (at 11%). Whenever I need money, I will be able to sell the extra shares off (which I haven't done so at this point)

However, I am also aware of concentration of portfolio so I won't increase my holdings for this.

Monday, February 23, 2015

Analysis of LippoMall Retail Trust

Current Price on 16th Feb 2015 = $0.35
  • Yield = 8.11%  
  • Price-to-book Ratio = 0.789
  • Assets per unit = $0.779
  • Debt per unit = $0.335 (including current liabilities)
  • Gearing = 43.0%
  • Secured NAV = $0.444 (127% of trading value)
LippoMalls Retail Trust has recently reported their results which are quite favourable and prompts me to think through my strategy again.

Their yield is currently at 8.11% which is one of the highest. Moreover, their price-to-book ratio is one of the lowest at 0.789 which means I am getting properties at 22% discount. The most important thing is that their secured NAV is at $0.444 which is higher than the trading price. In fact, 100% of their properties are currently unencumbered.

I have read an article which discuss about the recent bond which will mature soon and they haven't quite resolve the issue yet. It is a $200 million MTN due in July 2015. This is a concern and helps to depress the trading price. But I am quite sure that it will be resolved soon because they do have a strong sponsor i.e. Lippo which is the larger developer in Indonesia. Indonesia economy has also been doing well with strong domestic demand.

I am in the process of waiting for some of my money to be routed back to me and I will purchase this once I get it back. I won't be able to reach the dividend in time but it may not be a bad thing.

Tuesday, February 17, 2015

Happy Chinese New Year to all readers

Happy Chinese New Year to all my readers. It has been a great journey through these four years of blogging and sharing of thoughts about my investments. I hope you have learnt as much as I am as well.

For the new year, I am looking into capital appreciation as one of the means to increase my net worth as soon as possible instead of just looking at dividend yield. Moreover, I am also looking at taking more risk through margin accounts. I know the interest is high but it seems that the yield of those which I am vested is higher. It is a risky move but I am taking it as an experiment in comparison to investing in real estate.

Feel free to comment on this new journey of mine which I am going to embark on. I will update all of you the status and how I fare. :-)

Monday, February 2, 2015

Analysis of OUE Commercial REIT

Current Price on 26th Jan 2015 = $0.82
  • Yield = 7.02%  
  • Price-to-book Ratio = 0.747
  • Assets per unit = $1.927
  • Debt per unit = $0.829 (including current liabilities)
  • Gearing = 43.0%
  • Credit Rating = Ba1
OUE Commercial REIT has just reported its results recently which improves its yield and NAV. I think it is a good news so spend time to get more statistics.

Yield is at 7.02% which is much higher than Keppel REIT and Fraser Commercial REIT. Moreover, its price-to-book ratio is probably one of the best currently at 0.747. This means that you are getting these properties at about 25% discount. Recently, they got their independent valuation of their properties which shows an increase in its NAV.

One downside note is that their gearing is quite high at 43.0% and its credit rating is at Ba1 which is not investment grade. Its credit rating is probably one of the worst among REITs listed in SGX (excluding those which did not obtain one, but their gearing is limited at a maximum of 35%)

I am glad that I am looking at this counter after researching on FCOT and Keppel REIT and would probably invest in this with strong and favourable yield and NAV.

Thursday, January 29, 2015

Analysis of Keppel REIT

Current Price on 23rd Jan 2015 = $1.235
  • Yield = 6.39%  
  • Price-to-book Ratio = 0.909
  • Assets per unit = $2.169
  • Debt per unit = $0.811 (including current liabilities)
  • Gearing = 37.4%
  • Secured NAV = $1.142 (92.5% of trading price)
I resume researching on Keppel REIT because of its acquisition of MBFC Tower 3 and its relative high yield compared to other office REIT. So here is the statistics.

Yield is at 6.39% which is one of the highest among all the office Reits holding Singapore properties. FCOT is higher though. Moreover, they pride themselves to hold one of the youngest and most exciting properties in the Singapore's financial district. With a price-to-book ratio of 0.909, it is trading at 9% discount. Imagine buying MBFC at 9% discount? Moreover, they have a pretty high secured NAV which is 92% of its trading price. The margin of safety is also strong.

Considering that it is an office REIT which holds such assets, I think this is something worth considering (That's why I research on it). Bear in mind that they have a pretty strong rival and that is Fraser Commercial Trust.

Monday, January 26, 2015

Analysis of Fraser Commercial Trust

Current Price on 23th Jan 2015 = $1.51
  • Yield = 6.52%  
  • Price-to-book Ratio = 0.952
  • Assets per unit = $2.732
  • Debt per unit = $1.146 (including current liabilities)
  • Gearing = 41.9%
  • Secured NAV = $1.586 (105% of trading price)
I remember that I was once an investor in Fraser Commercial Trust and it has yield me great returns over the years before I finally sold it in 2013 (I think). To revisit it again is just like looking for an old friend. Anyway, they reported their results which is outstanding as they increase their DPU by 20%. Even if it is compared to the last quarter, it is still an improvement of about 10%.

With yield at 6.52%, it is quite comparable to Keppel REIT. However, their price-to-book ratio is 0.952. Keppel REIT is lower at this point. One more difference is that its secured NAV is 105% of its trading price as all their debts are unsecured and this is attractive because the margin of safety is much higher. Gearing is higher at 41.9% though.

To compare Keppel REIT with FCOT is not easy. One holds top grade assets while FCOT holds relative good properties. With similar profile, it is very difficult to decide which one is better. For me, I look at stats only and I will choose FCOT as my choice if I were to buy office REITs.