Welcome

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 $3,300/month.

Wednesday, October 10, 2012

Analysis of LMIR (after acquisition)


Current Price on 10th October 2012 = $0.455
  • Current Yield = 6.98%
  • Price-to-book Ratio = 0.798
  • Assets per unit = $0.855
  • Debt per unit = $0.285
  • Gearing = 33.3% (including current liabilities)
  • Secured NAV = $0.411 (90%)
LMIR has released a report on their potential acquisition today with some details. Again, they are buying assets at a discount which has always been the case for Indonesian properties. Here is the analysis.

Yield increased by a little bit only since they say that the increase is only 0.5%. It is quite insignificant. Next, its NAV value and secured NAV increases by $0.011 which is about 2.5%. Again, this is quite a small increase. Overall, I think the effect is not really significant.

A strategy that they are employing (which I see here) is that they have raised Singapore Dollar Notes to buy Indonesian properties. I think this is a bit dangerous as they are exposed to S$/IDR fluctuations. If Indonesia Rupiah drops, the impact is greater than expected. Probably this is the reason why it is trading at such a discount.

I am vested with 67,000 shares and will be looking closely at this. If need be, I will offload at the right price.

4 comments:

  1. Hi

    I just found your blog today. Looks to be a real resource for someone like me who is just getting into reit investing.

    With so much info, why do I start?

    Cheers
    Aaron

    ReplyDelete
    Replies
    1. Hi Aaron Chua,

      It is important to know your own investment philosophy and criteria which you will try to follow religiously i.e. what I have in my first paragraph.

      After that, do look through my blog to see which suits your needs. I don't really post a daily update so you got to check out reitdata.com for more information.

      Hope it helps.

      Delete
  2. The price now is 0.490. Do you think it's overvalued?

    ReplyDelete
    Replies
    1. Hi Ryan,

      Its price seems very high but it is still trading at a discount to NAV aka more than what they are spending on their properties which is usually about 20% to NAV.

      Moreover, its yield is still one of the higher ones we can find among the Retail REITs.

      I am holding on to mine.

      Delete