Monday, July 16, 2018

From “Not-So-Big idea” To Big Idea 9

My initial draft did not conclude this purchase as another Big Idea. But after completing the draft, I decided that this investment is a Big Idea.

I will not be hiding the identity for this company because, at this point in time, I will have already revealed the company name on my Facebook Post.

Big Idea 9 became the talk of the town once the cooling measures were announced by the authorities, and within the same period, a bigger rival got listed.

This was evidenced from my research as well. There were so many articles written by analyst and bloggers (Thelittlesnowball, Motley Fool, Heartland Boy, PropertyinvestSG) that it was hard to find hidden information that could possibility sway me to the “other” side.

Do note that this investment is very new and resulted in my portfolio increasing to 16 companies.

I am NOT taking a step back in my consolidation of my portfolio. I have been looking at Big Idea 9 for many weeks before I decided to invest in it. The recent share price drop of more than 50% from its peak has make it too tempting not to continue to say “No”.

Reasons Why This Counter Qualifies as a "Big Idea"

(Do note that I will not be talking a lot on the financials in this post because it has been stated so many times in other blogs or write up.)

1. History

To really understand the history of Big Idea 9, you need to understand its history. The company was initially purchased by Northstar Group from Hersing Corp for $130 Million in 2013.

Then after almost 4 years, it was relisted at 66 cents which valued the company at $234.43 Million (Number of Shares = 355 Million).

At that price, it was an 80% gain for Northstar Group. Based on the number of shares, the breakeven share price for the initial purchase amount by Northstar Group is $0.366.

However, this was the price 4 years ago. For a Private equity firm that continues to own 72% of Big Idea 9, I believe the wait must be profitable.

After incorporating a 5% compounded gain over 4 years, the “supposed” minimum share price by Northstar Group will be $0.443. In fact I believe this is still too low for the private equity firms.

Nevertheless, this minimum share price is about 35% below the current share price, which in my opinion is not a huge buffer and Northstar Group will most probably not let it continue to slide further.

2. Time Lapse And Projects Secured

New cooling measures are announced on 6 Jul 2018. But the 2nd Quarter Results will be from April to June. Thus, the 2nd Quarter results that will be announced most probably in August 2018 should not reflect the sudden drop in property purchases due to cooling measures.

Furthermore, Big Idea 9's Q1 results has been great and it should flow into its Q2 results. This is similarly expressed in its latest annual report, which states that “To date, Big Idea 9 has already secured more than 20 projects to be launched in 2018, with more than 11,000 residential units available for sale. This is more than double the 4,800 units (from 9 projects) in 2017 and signifies greater growth potential for Big Idea 9 and more sales opportunities for its’ salespersons in 2018”.

3. Enblocs And QC Certification

This was bought up by SG TTI on IN under Kenny Chia's Post. I guess it stuck a chord in me and it made me re-wire my thoughts. 

From my research on the Singhaiyi post, you just need to look at the number of Enblocs completed/announced since the end of 2017 till June 2018! Just imagine the number of developments that will be continued to announced throughout the year, as well as the projects already secured by the company as stated in the point above.

Screengrab taken from newcondolaunchonline.com
Although one can argue developers can always delay the announcing of the projects, but they will still be required to sell all of the units within 7 years of completion. They have to make sure that these developments have to be SOLD one way or another. 

During the not-so-long-ago initial cooling measures, if you had invested in developers then, you will have realised the actions developers take to “escape” such measures were never beautiful.

Furthermore, as expressed in the RHB analyst report, “For one, developers have started countering the measures with “more realistic” pricing and the offers of discounts of 5-10 percent in new launches, RHB said, adding that should draw more first-time buyers. Developers were also offering higher agency commissions of 3-4 percent at some launches, compared with the typical 1.5 percent, it said. It also noted that around 200 more units were sold last week at new launches, despite the measures.

Furthermore, around 35 percent of its first quarter gross profit from the “very stable” segments of non-brokerage income, leasing and HDB resale, it said.”

This was one of the reasons that resulted in me having a lack of confidence in its long term financials. However, after writing out my thoughts, it actually gave me more confidence of the company’s long term financials.

Do note that additional cooling measures will have impact on most probably in Q4 2018 and Q1 2019 financials, but at the current price, this impact should be “a piece of cake” for the EXPERIENCED LONG TERM HOLDING INVESTORS. 

4. Future Expansion 

The point of Future Expansion has been bought up by Heartland Boy in his initiation report. I do believe this will be a major catalyst for Big Idea 9 in the few years ahead. 

Screengrab taken from Heartlandboy Blog
5. High Free Cash Flow

I always liked FCF generation companies. I believe, out of all the figures bought up by various bloggers and analyst, this was missed out.
Cashflow Statement from Annual Report
6. Property Agents Are Not Property Developers

Property Agents Services will be required, pending full digital disruption. However, one can always argue that SGCarmart has been around for the longest period of time and car dealers continue to be around. 

Furthermore, do note that an oversupply in developments/cooling measures will caused major dents in a developers’ financials, but not for Big Idea 9 which just provide the agencies services. 

In Short

Thank you for reading till the end.

Big Idea 9 is actually APAC Realty Limited.

Before I conclude, I must highlight that all big ideas have its risks. For APAC Realty Limited, its recent purchase of the new building will definitely impacted its cash holdings and its balance sheet will most probably be worse off.

Nevertheless, in view of the various positives and the significant share price drop, I had decided to invest in APAC Realty Limited and make it one of my big ideas.

Moving forward, it is important to continue to purchase the shares in batches as I believe the road ahead could be rather volatile for the company before it goes on a huge uptrend.

One of the major catalyst is the most probably on the company's ability to break out of Singapore and diversifying its revenue in different geographical regions. After all, the cooling measures will only impacts property developments within Singapore. 

Please do your own due diligence before you invest this counter.

If you are interested to know how to measure a moat, do sign up with us to get the latest score of  the moat of all the SGX counters now! At only $10 a month!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Friday, July 13, 2018

Big Idea 8

Although I have revealed my portfolio and the remaining of my Big Ideas recently, but I have been wanting to writing about this company that I purchase since June 2018 – my Big Idea 8.

I had previously stated I will reveal the company on my Facebook Page post upon reaching 20 likes for that post. It hit 68 likes in almost 3 hours. I was flattered.


Despite the short vested period, I have actually known this company since I started practicing value investing. In fact, I will say this company was initially made famous by Bigfatpurse (Currently known as Dr Wealth) at that point in time.

Reasons Why This Counter Qualifies as a "Big Idea"

1. Understanding Of The Total Asset and Return of “Operating Assets”

Return of Asset of the company based on the latest annual report is 7.65% (Net Profit of $4.5 Million vs Total Asset of $58.9 Million).

Nevertheless, it is important to identify what the assets are made up of before making any assumption if the ratio is good.

Out of $58.9 Million of the Total Asset:

$17.2 Million belongs to investment property;
$8.2 million belongs to financial assets, and
$27.3 Million belongs to Cash and Cash Equivalent.

Thus, the remainder are operating assets amounting to $6.2 Million.

This meant that with only an operating assets of only $6.2 Million, the company is able to generate a net profit of $4.5 Million. This meant that the “Return of Operating Assets” is actually a whopping 72.5%!

This meant that majority of the assets are generating low return and investors will deem this as the management do not know how to use the cash.

But in my opinion, despite the low return, these assets will still be able to generate a return for the investors for the long term. A return of cash in form of dividend will most probably be a 1 time boost for the share price, which will not have a long term effect. Furthermore, these assets are also not really crucial to the company and can be converted to cash if required/necessary or when opportunities appears.

2. Improving Financials


A picture speaks a thousand words. Take a good look at the figures.

3. Undervalued Despite Price to Book near to 1

The Chairman’s statement is what I deem as the most important portion of the annual report.

In its latest annual report, the Chairman statement stated that:

“The Group adopted the cost model to measure its investment property. The carrying value, including the self-occupied freehold office unit, was S$19.144 million as at 31 March 2018. Fair market value as determined by Colliers International Consultancy and Valuation (Singapore) Pte Ltd, was S$33.65 million. The excess of fair market value over carrying value was not recognised in the Group’s balance sheet. The property is unencumbered.”

If investors do not dig deeper into the financials, he will not know that the investment property is currently valued at cost – which is a missed conception.

4. No Debt

The company do not have any debt and holds very little liabilities. This can also infer as the company is able to leverage up if it wants to.

5. Strong Business Model with a focus on R&D 

From my readings, the company have a focus on research and development and seem to be working with some NASDAQ listed companies.

As per Chairman Statement in the latest annual report, it has also stated that “two patents on 4x4 wave 2 wireless module we filed in FY2018 in China were approved in April 2018, giving us a good platform to market our proprietary products”. This meant that it could possibly expand its footing in China.

These are potential catalyst that can push the revenue to greater heights in future.

In Short

Many of the information stated above can be found from articles in NextInsight, threads in Valuebuddies, and Simple Investor FB page.

Prior to my purchase of the company, I was still a bit skeptical about purchasing this company. It was through many of the readings, and verification of each reading that convinced me of purchasing this company, and listing it as a Big Idea.

In my opinion, Big Idea 8 is a company with a widening moat.

Please do your own due diligence before you invest this counter (if you knew what it is).

If you are interested to know how to measure a moat, do sign up with us to get the latest score of  the moat of all the SGX counters now! At only $10 a month!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Sunday, July 8, 2018

My 15% Portfolio - Changes After 2 Quarters

It is the time to review "My 15% Portfolio". The previous review in the 1st quarter can be read here.

However, do note that despite aiming for a 15% gain this year, the market has not been kind to me. The current change in my portfolio is VERY FAR from it and it will be revealed later on.

Do note that this portfolio was inherited from the portfolio at end of 2017 and their respective share price was restarted on 26 Dec 2017.

Thus, any gain or losses was just based on the price changes over the last 6 months.

Prior to taking a look at the changes in my portfolio, let me emphasize on the following:

1. This portfolio review is calculated from 26 Dec 2017 and the aim is to review the total portfolio gain after 1 year.

2. The counter's initial share prices are their respective share prices on 26 Dec 2017.

3. The gain and loss stated is just a simple calculation of the difference in share prices, ignoring the transaction fees.

4. At times, if stated, the gain could include dividends.

5. This review will include my overseas counters in USA and Hong Kong.

End of 1st Quarter 2018
End of 2nd Quarter 2018
Singapore Telecommunications Limited
Singapore Telecommunications Limited
Chuan Hup Holding Limited
Chuan Hup Holding Limited
Captii Limited
Captii Limited
NikkoAM-StraitsTrading Asia ex Japan REIT ETF
Sold All At 2% Loss
Japan Food Holding Ltd
Japan Food Holding Ltd
Netlink Trust
Sold All At 5% Loss
The Trendlines Group Ltd
The Trendlines Group Ltd
Challenger Technologies Ltd
Sold All At 15% Gain
Colex Holding Ltd
Sold All At 25% Loss
TSH Holding Ltd
Sold All At 20% Loss
Starhill REIT
Starhill REIT
HongKong Land USD
HongKong Land USD
GRP Ltd
Sold All At 20% Loss
ABF SG Bond ETF
Sold All At 2% Loss
M1 Ltd
Sold All At 1% Gain
Ellipsiz Ltd
Ellipsiz Ltd
Starland Holdings Ltd
Sold All At 30% Loss
Sysma Holdings Ltd
Sysma Holdings Ltd
CWX Global Ltd
Sold All At 20% Loss
Singhaiyi Group Ltd
Singhaiyi Group Ltd
The Walt Disney Company (USA Counter)
The Walt Disney Company (USA Counter)
Quarterhill Inc. (USA Counter)
Quarterhill Inc. (USA Counter)
Win Hanverby Holdings Ltd (HK Counter)
Win Hanverby Holdings Ltd (HK Counter)
Powershares QQQ ETF (USA Counter)
Sold All At 5% Gain
Goldpac Group Ltd (HK Counter)
Sold All At 3% Gain
Cowell E Holdings Inc (HK Counter)
Sold All At 15% Loss

Additional: The Hour Glass Limited

Additional: Powermatic Data Systems Limited
In addition to the current counters in the table above, I have also bought and sold:

Dutech Holdings Ltd - About 5% Gain

I have stated previously that I am moving into a more focused strategy and created a list of 9 Big Ideas that contributed more 60% of my portfolio. With that change, I have reduced the numbers of companies in my portfolio from 26 to 15. My portfolio is currently down about 7.84% since 26 Dec 2017. I am currently holding on to about 17% cash.

Reasons for the drop in the portfolio were due to the following:
1. Singtel and Ellipsiz are 2 of my biggest holdings and they are on a downward trend;
2. My current overseas counters are also in the red very badly. 2 out of the 3 overseas companies have lost more than 20% on paper.
3. Only 2 out of 9 of the Big Ideas are green. The rest are red.
4. Trade war rumors and cooling measures have also caused the market to fall, and indirectly affecting my portfolio.

In Short

The market has not been nice to the retail investors. Many reasons or excuses could be used to explain on why did this happens. But if we believe in our method and due diligence, we should always be able to sleep well at night.

Last night, when cooling measures arrive, I was still able to sleep well because I did my homework.

Here are some past articles I wrote this year about the initial short market correction:

Steps To Take In A Market Correction

More Thoughts From This Market Correction

And also a post on the Ultimate Scorecard method I use as well as some words or wisdom:

The Ultimate Scorecard Criteria In "Words"

Words of Wisdom and Big Idea 2

Hope these articles will assist you to sleep better during these "sleepless" nights.

Please do your own due diligence before you invest in any of the stocks in my portfolio.

If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Saturday, June 30, 2018

All Other Big Ideas

Before I start introducing my other big ideas, I like to first say thank you to SGX for inviting me to their Mid-Year appreciation dinner. It was really an honor to be there with many other established bloggers.

During dinner, they introduce that SGX Gateway will be quite interesting in the 2nd half of the year. Lets' look forward to it!



Furthermore, I also like to thanks my readers who had liked my Facebook Page. It has now reached more than 1,000 likes! Really Appreciated!


Now back to the main topic... 

It is time to introduce my other big ideas. The reason why I decided to talk about my remaining big ideas, because I will be revealing my portfolio updates in the next post and everyone will know all the companies in my portfolio. Thus, this will be a "touch and go" post on the remaining Big Ideas.

Big Idea 5 - This idea can reveal in a picture.


Big Idea 6 - This idea has been written by Stock Research Asia recently. The positives of this company have been elaborated in a few posts by them. Do read them up!

Big Idea 7 - This idea has been discussed significantly on InvestingNote. There are a few posts written by the InvestingNote community which are already very indepth. If you read these posts (Post 1, Post 2), it could renew your faith in this company with significant moat.

Big Idea 8 - This idea was previously reveal on my Facebook Page. Look for this post to find out more about the company!


In Short

Currently, all these 8 Big Ideas contributed to almost 62% of my portfolio. 4 of them are in green, while another 4 are red. I will most probably elaborate more on some of these Big Ideas in the future posts.

If you have any thoughts on the Big Ideas above, do comment on any of the platform I am on!

Please do your own due diligence before you invest this counter (if you knew what it is).

If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Sunday, June 24, 2018

I Am A Financial Blogger

This is another short post and it is more of a personal matter/opinion.

Nowadays, if people contact me on LinkedIn or if I went for a chat on a new role, I am very upfront in telling them that "I am a financial blogger and I will like to continue writing".

However, I realised this has become a deterrence for me to proceed further with the chat or with the people who contacted me on LinkedIn.

I can sort of understand why people prefer not to hire bloggers - Because they do not know what we will eventually write about and whether we will be revealing any insider's news on our blog.

For my current employer, I am not sure if they knew that I am a blogger. However, I did not reveal this at the initial chat because I just started blogger for about 1 year then.

But now that I appear in public for some of the seminars, I believe I should be upfront about this hobby of mine.

Nevertheless, it seems like this form of honesty and integrity has not much value at all.

Anyway now it is time to go back to The World Cup!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Sunday, June 17, 2018

How Do We Measure A "Moat"?

I believe many of you, similar to me, have your minds on World Cup and your portfolio have taken a back seat.

After all, with the trade tariffs news (US and Europe, US and China, US and Canada), Fed rate hikes, and ECB to phase out QE at the end of the year, I have major doubts the share prices will rise back next week.

STI have also fallen from 3,385.71, as of 26 Dec 2017, to 3,356.73 as of 15 Jun 2018. This is the first time in 6 months that STI have fallen below the 26 Dec 2017 level.

In addition, we are also having the "sell in May and go away till November" effect and most probably the World Cup effect.

So in order to sleep well, how should we invest?

I always felt investing in fundamentally strong companies that is constantly able to generate good earnings will generally help retail investors to sleep well. In order to do that, Simple Investor and I created Fundamental Scorecard website.

As of this month, Simple Investor has continued to improve his Full Analysis Scorecard with a "Moat Scoring".


I believe this is the first time someone has tried to measure a "Moat" of a company and I have to say it is quite accurate. I am really amazed!

Anyway here is what Simple Investor wrote on his Facebook:

"Let's talk about moat.

The term economic moat, popularized by Warren Buffett, refers to a business' ability to maintain competitive advantages over its competitors in order to protect its long-term profits and market share from competing firms.

Basically, it's a defensive structure. Some company has it, others, not so much.

With the recent update of full analysis, I want to showcase some examples of moat. Let's take a look at 3 companies.

The first example of a strong moat company is M1. From its past performance, we can deduce that M1 does indeed have a moat. After all, the telco industry was a oligopoly until the recent days. Remember the days where our mobile plans, internet and cable TV only got more expensive? As detected by the moat scorecard, M1 has a long term strong moat - but that is decreasing.

When looking at moat, one should also consider its durability and trend, in addition to strength. As we can see for M1, although things are not looking good, they still have enough power to put up a fight - but we would prefer to invest in a situation where the moat is stable or increasing, since results are unpredictable with moat destruction.


The next example is one with a weak moat. I'm sure Old Chang Kee is a familiar name to most of us, but when is the last time you bought something from them? And did you know a stick of fish ball is now $1.60? As we can see, Old Chang Kee faces some pressure when increasing prices, thus it only has a weak moat. Further inspection tells us this moat is decreasing, and history shows an even worse sign - company has dipped below moat criteria, breaking its historical trend. All these points us towards caution when dealing with the company.


The last example would be one without moat. SIA is a typical company with no pricing power, leading to a no moat scoring in our scorecard. These are the companies we try to avoid, especially in long term holdings.


What about Kimly, Sheng Siong, Ho Bee Land, Thai Beverages and over 700 other stocks? Check out full analysis scorecard at https://www.fundamentalscorecard.com/

Full analysis - understand a company in 5 minutes. By the way, what is shown is only the first page of full analysis scorecard. Other pages includes ratio and warning signs, shareholders concern, Net worth analysis, recent insider transactions, insider shareholdings, growth, value and income analysis.

*P.S can you spot our next upgrade? Hint: It's in the valuation column.

*Information in this post are not buy/sell recommendation. Always consult a professional should you need to before making investment decisions."

With that, I hope you will take a short break from World Cup and look at our Fundamental Scorecard website.

We do not expect you to be convinced to sign up immediately, but do ask us questions if you have, we are more than happy to answer your queries!

Please do your own due diligence before you invest in any of the companies discussed above.

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Sunday, June 10, 2018

A Short Short Post

This week, I just have some thoughts.

It wasn't a good feeling when I stared at my portfolio that has been in red since many months ago.

I am still fine with the red portfolio - down about 4.3%.

However after Trump's recent G7 summit's chaos, I really start to believe we are in a bit of a s*** for at least till end of the year. 

In addition, now that we have a world cup coming and more interest rate hike. I believe the volatility will be significant. Or probably a redder portfolio in the next few months.

Now that I have said it, I hope everyone will be prepared for what is coming.

Nevertheless, I doubt we will see a major bear but a continuous playful bear for the rest of the year.


That's all for this short post.

Maybe its time to ignore everything and just focus on what's important - The World Cup!

World Cup 2018
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Sunday, June 3, 2018

Big Idea 4

I bought a new company and announced it on my Facebook Page recently. The overwhelming likes made me revealed the company at that time. Thus, there was a dilemma in me whether I should announced why I bought that company or talked about the other company which I had re-invested in Jan 2018?

I decided that the latter - The company that I had re-invested in Jan-2018 - will be Big Idea 4.

I have written quite a lot about this company and invested in it slightly before April 2016. I sold the last of their shares in Dec 2017 at its peak and almost a 2-times bagger, after the company divested its main business and announced a mega-dividend. After the price came down, I re-invest in the company.

Reasons Why This Counter Qualifies as a "Big Idea"

1. Most "Liquid" Balance Sheet


Based on the above information:

Net Current Asset Value - $0.522

If we take Financial Assets and Other Receivables into account, the Net Asset Value will rise to over $0.648.

This value is 16% above the current share price.

Do note that the Financial Assets is related to their shares in another listed firm, and Other Receivables are related to the remaining amount from the divestment of its main business.

2. Still "Profitable" Business


Despite a drop in Gross Profit Margin, the Q3 2018 losses was due to an exchange loss not due to the current business operations. If this exchange loss was added back, the net profit will be $26k.

However, many people could potentially missed this and sold off this company too early.

Nevertheless, it is important to note that the Gross Profit Margin has dropped and I will continue to monitor the results in Q4.

3. Management 

This is something I am not sure if anyone has picked it up before. The company's current management are the sons of the biggest shareholder.

Rather than "giving a company" to the children to play along, this should be a way the biggest shareholder want a firm control of the company.

Do note that the children had experience in managing other listed firms before.

In Short

Currently the company's share price has dipped significantly. I had continuously added it at various level. This company now contributes to over 8.6% of my portfolio (Remember that these big ideas are supposed to contribute up to 50% of my portfolio?), with a loss of 11.4%.

Recently the company have also made an acquisition and many people, including me, do not reall have positive vibe about this acquisition.

Nevertheless, this is a company I purchase mainly due to the margin of safety above its net asset value.

In 2 months time, it will announce its full year results and more answers on the use of its cash pile could be reveal in its financial report. Therefore, I will decide then on what to do with this company. In the meantime, if the share price continues to fall much more, I may continue to invest more into this big idea!

Please do your own due diligence before you invest this counter (if you knew what it is).

If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Thursday, May 31, 2018

Thank You SGX For Inviting Me!

Firstly, I like to say my thanks again to SGX for inviting me to be one of the panel speakers along with so many other gurus!




It was a great talk and I learnt a lot from the other speakers as well! I hope my answers for the many questions have been satisfactory to the participants as well!

As I look at the pigeonhole website (participants were able to post questions on this website), I realised there is 1 particular question relating to my scorecard method. Therefore, I think I should provide an answer to the question. Hopefully the people that posted this question and voted for this question is able to read this answer!


How can the tub scorecard capture and account for market sentiments and industry outlook. Also, even if it’s an undervalued stock, how can then the value be realized if it’s out of favour?

Ans: Firstly my scorecard capture and account for market sentiments and industry outlook via the changes in share price. This is because the scorecard report contain ratios such as Price-to-Book, Price to Earnings, Price-to-Free-Cash-Flow and Dividend Yield. Thus, any change in share price will cause the scoring to change.

As for the second portion of the question, I can only say value will take time to realise. But for the scorecard method, there are 2 factors that could give the value counter a higher chance of realising the value -

(1) my scorecard focus on company with lots of cash. A company with cash is able to use them to make investment, buy new businesses and give dividend. This will potentially increase the share price to a higher level.

(2) To pass my scorecard, the company has to do well in not 1 area (balance sheet, earnings, cashflow statement, etc), but at least 2 or even 3 areas to get a pass. Thus, this allows more opportunity for the company's value to get recognised.

However, I must also comment that not all counters that pass my scorecard is a definite hit. Similar to all other methods, this is just a level 1 check. We must have a deeper understanding of the business and financials in order to ensure we are purchasing a company that we are comfortable holding while we sleep at night.

That's all!

If you have more questions, do feel free to post them on my Facebook Page, on InvestingNote, commenting below or even email me. I will try my best to answer each and everyone of them!

If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Sunday, May 27, 2018

SGX Event and The Role Of Dividend Yield

Before we go into the actual discussion, I like to inform my readers that I am very privileged to be invited to be one of the speakers for the panel for "My First Stock Carnival Week - Different Investing Styles and Finding Your Ways" organised by SGX.

I will like to thank Shanison of IN and SG Thumbtack Investor for the recommendation.

Here is the link to register for the event and its FREE!

I hope to see you there and do "direct" all the question you have for me, I will try my best to answer!


So back to main topic of today - Dividend Yield.

Recently while I was engage in some analysis, I realised dividend yield played a lesser role in my analysis currently as compared to my previous analysis. 

Thus, it makes me wonder if dividend yield should be an important factor in our analysis?

For example, if a company makes increasing revenue and net profit, but did not increase the dividend, should retail investors be angry with the firm?

As much as many of us are obsessed with dividend, I believe we should not be upset if a company did not increase its dividend. After all, it is still increasing its revenue and net profit for you as a shareholder - the directors could have other things in mind. 

We should be patient and see what they use for the money instead. It could be for research and development work that could push the company towards another level!

Thus, unless you are an income investor (whom I suppose should be focus on REITs or Blue Chips), then I believe dividend yield could be a factor in an investor's analysis, but should not play a big factor in whether you intend to continue to invest in the company. 

What do you think?

If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Thursday, May 24, 2018

My Ex Just Announced Her Results!

If you have read about the previous post about my Ex, I am updating here that she just announced her full year results!

And I was right! The dividend has decrease from 33 cents to 18 cents!

If the retailer investor is looking for 5% dividend yield, then he will be expecting the share price to fall to $3.60!

But I have my doubt that the share price will drop till so much!

If you read about the news article, there are a lot of hidden messages. Are you able to catch them?

For existing retailer investor, I advise you to ignore the news report and spent some time to look at their latest financials results. Hopefully you will be able to pick out their "important" numbers.

There are 2 "firsts" over the last 3 years in the most ignored portion of the financial results! If you picked them out, that will be great!

Next, for existing retailer investor, it is also important to remember "why did you invest in Bukit Sembawang Estates Ltd"?

Once you remembered the reason, go back to the facts and see if the company still have "it".

As for me, let's just see how much the share price will drop!

Please do your own due diligence before you invest this counter.

If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

You can also purchase a copy of our Guide to SG Stock 2018 for only $8 via this link.

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Sunday, May 20, 2018

What Is A Moat?

Recently for my Big Idea 1 and Big Idea 3, I have been talking about discovering "Moats" of the companies.

But I am wonder if those information that I provided are really "moats"of a company? Or am I using this term too loosely?

As per Investopedia (do read this page for a much deeper understanding), an economic moat is a competitive advantage that one company has over other companies in the same industry; this term was coined by Warren Buffett, a renowned investor and executive at Berkshire Hathaway. The wider the moat, the larger and more sustainable the competitive advantage of a firm. By having a well-known brand name, pricing power and a large portion of market demand, a company with a wide moat possesses characteristics that act as barriers against other companies.

The website further explains that economic moat describes a company's competitive advantage derived as a result of various business tactics that allow it to earn above-average profits for a sustainable period of time. Companies that obtain defensible competitive advantage from patents, cutting-edge technologies and other cost advantages can have a wide economic moat that curbs competition within their industry. Also, firms that enjoy strong economic moat tend to demonstrate solid financial performance and rising returns on capital over time. The most common sources of economic moat are cost advantages, switching costs, efficient scale, intangible assets and network effects.

In laymen terms, my understanding of the explanation is that A MOAT is a COMPETITIVE ADVANTAGE over its competitors, that could potentially allow it to earn a HIGHER OR AN INCREASING REVENUE AND NET PROFIT, showing GREAT RETURN OF CAPITAL OVER TIME.

Some examples of a moat can be patents, franchised rights, know-how, and being a market leader. On the other hand, many moats can also be caused by government intervention - such as Singapore require a Telco provider to be licensed.

In addition, I underline "OVER TIME" is that certain comparative advantage, while allowing a company to earn a high revenue, net profit with great returns, is not sustainable. Thus, I believe it is important to understand this concept and analyse a business correctly by placing an emphasis that the comparative advantage is sustainable.

It is also important to note "moats" does not make a company invincible. Just take a look at the traditional businesses getting disrupted over the last few years. An example is Comfort Delgro's drop in taxi revenue with the introduction of Grab and previously Uber. Another example is SPH reducing advertising revenue when internet becomes widespread.

Therefore, even if a company has a moat, there could be a possibility that it could eventually be destroyed. With that in mind, it is important that a company continue to innovate and improve, in order to continue to maintain or improve the company's financial standing.

1 question I have in mind is if a company having cyclical earnings can be considered having a moat? In my opinion, if the revenue and net profit is not consistent, I do not think the company should be considered having a moat.

However, if you disagree, do comment below!

If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Sunday, May 13, 2018

Big Idea 3

After writing about Big Idea 1 and Big Idea 2, I will talking about the next Big Idea.

Big Idea 3 is actually quite a new company in my portfolio. I have only held it for about 1 month.

It was also never mention in any of my portfolio listing. Upon checking, I realize that I have only written about this counter in a 2015 post.

Reasons Why This Counter Qualifies as a "Big Idea"

1. Discovering Its Moat

I must confess that this company do not really have a significant moat. In fact, its industry have a low barrier of entry.

However, as this company sells a "luxury niche product", it creates an invisible barrier of entry.  This is because consumers will not just go to any shop to buy this "product". They tend to choose renowned shops that they TRUST to buy this "product".

Since it is also a "luxury niche product", not anyone can just straight away open a new shop to sell this "product".

In my opinion, this company is also a market leader within this "luxury niche product" space.

Thus, with a company's name that is easily recognised by consumers intending to purchase this product and also being the market leader within its space, I believe these are possibly the company's moat!

2. Improving Margins + Better Than Its Direct Competitor

Counter's Financial

Direct Competitor's Financial

Firstly, you will notice that the company's Gross Margin and Net Profit are improving over the last 3 quarters. If you compare it to 2017 4th quarter, there is a high possibility that the next quarter's Gross Margin and Net Profit could improve further.

Next, if you compare the company's margin against its direct competitor's margin, you will realise the company is performing much better even though their Gross Margin is almost the same.

Finally, even if the company's "other income" is removed, which in this case is rental income, the Net Profit is still much better than its direct competitor.

3. Management's Words

If you knew which company I am talking about and you read the 2017 annual report's Chairman letter, it have stated that the goal is to reduce the inventory turnover days.

Thus, from the above analysis, the inventory turnover days have reduced significantly every quarter and it is also been faster than its competitor.

With the above improvement in inventory turnover days, I will gladly ASSUME that if the company continue to perform "similarly", the 4th quarter financials will be satisfactory for the investors.

In Short

The above stated reasons are explanations of why I decided to list this counter as one of my Big Idea. Do note that there are still many potential reasons to why I invested in this counter.

Regardless, it is good to note that I do not think the above reasons indicates that the company does have a great moat. But I believe, even without a significant moat, it qualifies as a Big Idea due to its improving margins and financials.

Do note that its full year results will be coming out this month.

Please do your own due diligence before you invest this counter (if you knew what it is).

If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

You can also purchase a copy of our Guide to SG Stock 2018 for only $8 via this link.

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.

Friday, May 11, 2018

Trip From Beijing

Sorry for the delay in writing, but I just came back from a trip in Beijing. I was expecting a culture shock but it turn out better than expected.

Throughout the trip, I had learnt many interesting aspect of the city, such as the following:

1. Spitting on the ground is common.

2. Seem hard to get any taxi and train stations are quite a long walk away (Or maybe Singaporeans are just too pampered?). End up becoming the "cabbage head" for other transport services.

3. You need to walk a lot, especially in the landmarks. Do need to look out for any trams.

4. Taobao has killed cheap clothing in the city. Shopping became quite boring. Only international/big brands that are not located within Taobao seem to have shops around.

5. High living standards. The food seem to cost as much as those in Singapore.

6. But it is still the ancient city with many landmarks not to be missed.

7. Security is a top priority in the city. Even train stations have checks. There are also a lot of police around. I felt very safe.

8. The pollution is very bad. The sky is clear but the dust in the air look like "snow". I am serious!

9. The power of Wechat and Alipay. If you happen to use cash there, you are not a local. Cash is a thing of the past.

But this trip made me realised why some interesting business can only work in Beijing and not in Singapore?

1. Last Mile Courier.

There is a reason why courier services are "great businesses" in China. You will see a lot of such vehicles in China. This is because Beijing is an ancient city and there are a lot of old houses ("Hutongs") without clear address. Thus, last mile courier services are required to locate each and every customer within the city.



2. Bike Services

Due to the traveling distance between destinations and the location of some of the residential area, these services are definitely required by the public.

Unlike Singapore, everywhere is very convenient and within walking distance from bus stops or train station. But this is different in Beijing.

However, due to the number of operators, this industry seems to be very competitive right now (Yes, both Singapore and Beijing currently have a lot of operators!). Bike services operators have to differentiate themselves to be relevant in future and not to continue "burn cash".

3. Small Transport Taxi


This is really something interesting I found in Beijing. There are quite a lot of these small taxi around in Beijing. However, it seem to be cater to pick up a single passenger only. Thus, I did not take this transport when I was there.

In Short

This trip made me realised 2 important factors - (1) As investors in overseas markets, I felt we should actually go to these countries to take a look and understand how businesses operate there. With extra knowledge, then you will be able to select better businesses that could possibly survive the competitive aspect in each industry. (2) Localisation is required for businesses that are expanding into China or overseas. Without understanding the country and just expand directly into the country will just be a waste of time.

Oh... I also took a picture that is linked to one of my Big Ideas.


If you are interested to know more about The Ultimate Scorecard or Full Analysis, do visit the Fundamental Scorecard website for more information! Do sign up to get the latest scorecard of all the SGX counters now! Only about $10 a month!

You can also purchase a copy of our Guide to SG Stock 2018 for only $8 via this link.

Oh... and do remember, please like our Facebook page (T.U.B Investing) and follow me on InvestingNote.