Sep 15, 2013

Planning for a hands-off period for my SG and Thai investments

I am leaving sunny Singapore for cold and wet England soon, and will be there for a year. I have many things to miss but on the plus side, I will be located near the northern region where the scenery is beautiful. Monitoring company and financial developments in Asia will be a bit troublesome for me and I would probably be reading up once in a while, and perhaps might poke my nose into the British stock market instead.

After the period period of selling-downs where my portfolio experienced about 15% drop from its peak, the bounce up from the past week was uneven across my portfolio. Generally, my Thai stocks recovered more. In this period, I had accumulated more Marco Polo Marine, Krung Thai Bank, and True Corp. I divested Thai Bev earlier to protect my profits but missed the opportunity to re-enter as I had been waiting too cautiously at S$0.40 instead.

Nevertheless, I do not have much pruning left to be done. Looking forward, certain news and 'catalysts' may emerge which will affect stock prices.

US debt ceiling somewhere in September when Congress is back, or 1st October. FOMC meeting should be around September 17-18 followed by Botak Ben's press conference. Things have also seemed to cool down between Barack, Putin and Assad for the time being.

Earlier foreign outflow of funds in Thailand caused its exchange to tank and the baht to weaken considerably. However the past week has been good to Thailand with renewed optimism about Asian exports. Global funds bought $310 million in Thai equities than selling in the first four days of the past week. Foreign investors contributed a net of $381 million into Thai bonds this week. The baht gained 1.3% this week to about 31.74 per USD, however it faces downward pressure in this weak market environment.

Krung Thai Bank is up about 21% after the past 11 trading days. Meanwhile, in my previous write-up about one of its troubled debtors, Saha Farms, with 20% of Thailand's poultry market, is today in the spotlight again as Krung Thai Bank guides it along on business rehabilitation. Earlier this week, CP Foods denied any plans of a takeover for Saha Farms. Krung Thai Bank, a state-run institution, will be closely involved in government infrastructure projects, as PM Yingluck promises to press ahead with stimulus mega-projects.

Thai Beverage has several potential catalysts and events upcoming; decision on F&N beverages and F&N's tussle with MEHL over Myanmar Brewery.Thai Bev also has a few cards on hand as it expands its distribution network in the south and explores cost-savings via freight train transport. Thai Bev also already owns a right to develop a Chang Beer brewery in three locations in Myanmar.
I am anticipating the results of sales of Oishi tea recently launched in Malaysia via F&N Berhad, as well as the effects of the increased alcohol excise tax.
Focus will also be on the 3Q results as the second half is expected to improve over the first half of this year.

TRUE Corp is the disappointing one, with executives boasting confidently of pushing ahead with its infrastructure fund a few months back, has now backed down to CAT on the dispute over ownership of 4500 of 7000 telecom towers originally earmarked for the fund. The fund may be cut from $3.1 billion to $1.9 billion. TRUE is in a hurry to raise funds as it needs to pay down debts as well as plans to spend $470 million on expanding its 3G and 4G networks as industry players are scrambling for market share as Thailand's mobile data usage grows.

Marco Polo Marine, I have not been keeping track of it much since the first half results. Share price is now up to close at S$0.38 however trading volumes have been pretty thin. Indonesia's interest rate hike should not affect MPM much. Barring any unforeseen events, the company should be seeing strong growth next year when more OSV's comes under their stable and when existing charter rates get renewed into current market rates which are much higher.

CACHE has seen its price beaten down into more attractive yield recently. I had written about some insider trades recently and John Lim has again shaved off more of his holdings by 0.05%. There are not much of future events to anticipate currently besides potential acquisitions.

Starhill Global's Wisma Atria reported that rents renewed in the 12 months to June were 15% higher even as other retail rental revisions were lower. Despite flat growth of retail rent amid more supply of malls, international and regional brands expanding into Southeast Asia will likely benefit owners of malls in the Orchard MRT vicinity.

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