Moderators: alvin, learner, Dennis Ng
Dennis Ng"22 Jun 2012
]today STI closed down, but OPH closed up, close at S$1.925. I bought some more this morning at S$1.86.
The chance of OPH proceeding to go ahead with the REIT deal is increased with today's corporate announcement.
Cheers!
Dennis Ng
Orchard Parade to Expand Hotel Business in Southeast Asia
By Ee Chien Chua - Jun 22, 2012 6:16 PM GMT+0800
Orchard Parade Holdings Ltd. (OPH), a unit of Singapore’s largest closely held developer, plans to expand its hotel management business in Southeast Asia to tap the region’s tourism growth, Chief Executive Officer Lucas Chow said. The stock surged to the highest in 4 ½ years.
The company proposed a transaction on June 13 to set up a hospitality property trust and swap assets with its parent, Far East Organization. The deal will give Orchard Parade a hotel management company with three hotel brands, Village, Oasia and Quincy, and contracts to run more than 3,400 hotel rooms and serviced apartments in the city, giving it a base he calls “fortress Singapore.”
Enlarge image Orchard Parade Holdings CEO Lucas Chow
Lucas Chow, who is also an executive director at Far East Organization, said “If you want to grow beyond a certain size, and if you really want to grow your brand, we need to have a presence in some of the major cities in Asia.” Photographer: Munshi Ahmed/Bloomberg
Orchard Parade is seeking to expand overseas with an increasing number of tourists traveling to Southeast Asia, a region with a population that’s about twice of the U.S. Singapore, Bangkok and Kuala Lumpur were this week ranked among the top 10 destinations in the world by Mastercard Inc.
“If you want to grow beyond a certain size, and if you really want to grow your brand, we need to have a presence in some of the major cities in Asia,” Chow, who’s also an executive director at Far East, said in an interview in Singapore late yesterday. “We will have to look at other countries for opportunities of growth.”
The initial focus will be on cities within a three-hour flight radius, Chow said, which will include Jakarta, Manila, Kuala Lumpur and Bangkok. Europe may also be a consideration in the longer term, he said.
Exponential Growth
“The tourism numbers are rising and expected to continue to skyrocket exponentially” in Southeast Asia, said Nicholas Mak, executive director at SLP International Property Consultants, a real estate consulting company. “Businessmen will be going there to look for business opportunities, and there is a great shortage of business grade, four-to-five star hotels over there.”
The transaction with Far East will also include a one-time dividend to shareholders and the distribution of shares held in a Singapore beverage maker, according to a June 13 statement.
[size=150]
Orchard Parade expects to get S$233 million ($183 million) in cash from the hospitality trust, which it will use help fund the expansion overseas. It may also get more management contracts as Far East builds new properties in the city, including a hotel where a temple built in 1824 will be converted into its lobby, Chow, 59, said.[/size]
Share Performance
The stock surged 2.9 percent to S$1.925 at the close in Singapore, the highest since October 2007. That extended this year’s rally to 50 percent, compared with the 6.9 percent advance in the Singapore benchmark Straits Times Index. (FSSTI)
The deal with Far East will also include parts of two medical developments close to the downtown owned by the parent company, Orchard Parade said last week.
The addition of health care, along with its property development and hotel businesses, will help broaden its appeal to investors, Chow said. The most expensive real estate in Singapore is in the health-care industry, Chow said, citing a recent transaction in the country.
“We like to call ourselves the emporium of real estate because we like to diversify ourselves into different kinds of properties,” Chow said, adding that health care is less sensitive to economic cycles compared with the property business. “If you diversify, you are also diversifying the kinds of cycles for the company.”
To contact the reporter on this story: Ee Chien Chua in Singapore at echua27@bloomberg.net
[quote="Dennis Ng wrote:Chua Kim Kee wrote:Dennis, thank you for your explanation. One of my concern is that the YHS shares are not very liquid and may not be easy to sell for cash. According to the circular issued to shareholders, only 742 lots per year or about 2 lots per day. However, Having said that, they have recently delisted YHS in Malaysia & who knows, may plan to delist YHS from SGX one day.
CKK
even if nothing happen to YHS, if OPH just sell its properties to inject into another REIT and selling at price about NAV, guess what is likely to happen to OPH's share price?
Today, STI fall by 0.8%, but so far, OPH's share price went up to S$1.88 instead.
seminar graduate waterman has done a very good job in analysing the potential Rewards and Risk of buying/holding OPH shares at current prices in the posting below.
Cheers!
Dennis NgWaterman wrote:The share price closed on last Friday, 15-Jun-2012 at S$1.875
Kudos to James who discovered this exciting undervalue stock as early as in year 2010.
The event finally at it's proposed stage. i took some time reading the 30 pages media release and proposed restructuring doc.
Currently, due to issues in Europe, it is really not easy to choose between taking profit or pend for the potiental higher returns.
1] Take Profit
Profit = Current share price - Cash dividend collected - Price purchased
2] Hold
- To receive special dividend of S$0.12/share
- To receive spinoff of 229 YHS shares per 1,000 OPHL shares (YHS closed 15-Jun-2012 at S$1.46)
- Potential OPHL to rally further / Price drop if IPO of FEH-Trust fail to take place
- Potiential risk by the macro environment of the world
Interesting part i read from the doc page 20. Assumption of post transactions, special dividend and spinoff, the NAV per share is still at S$2.78 is just too amazing.
i wonder if my friend, CKK will go to attend the EGM this time.
Looking forward for Dennis to return and share his view.
By the way, even if the IPO of FEH-Trust fail to take place, OPHL may still adopt a nice new name as "Far East Orchard Limited"
Waterman
Source: SGX
Dennis Ng wrote:jamestai wrote:13 Oct 2009
Hi,
Need some advise, not sure should I cut my losses for my Starhub stock.
This my current STARHUB shares holding.
Number of Shares: 5000
Average cost per share: $2.2130
Last closeing price on 12 Oct 09 : 2.00
My current losses is around: $1015
Since STARHUB lost the EPL right, the share price drop from around $2.15 to around $1.96. I am not sure does it still make sense for me to hold on my current STARHUB and hoping it will help me to make a profit in future. Some say STARHUB stock pay good divdend. But I not sure does it still hold true after it lost the EPL rights to Singtel.
Any opinion and advise is very much appreciated. Also I wonder does any body know what is the NAV for STARHUB.
James
Hi James,
you need to ask yourself, why did you buy Starhub at S$2.21?
Why are you thinking of selling Starhub now that the price is lower at S$2?
If price is lower, it actually makes the share more attractive not less. It does not make logical sense to want to buy at a higher price but think of selling at lower price.
Nobody buys Starhub for its NAV. As explained in my seminar, NAV is only useful for assessing Financial stocks and Property stocks.
For starhub, the key things to look for is its Operating Cashflow and Profits and the sustainability of its profits.
Let's assess the Financial impact of Starhub losing the EPL rights. Total revenue from Pay TV (cable TV) only constitutes 19.6% of Starhub's total revenues. Out of which, Starhub says only 30% of its Cable TV subscribers subscribe to EPL, or only 5.88% of its total revenues.
According to starhub, its EPL offering is actually at a loss. Thus, losing EPL might not reduce starhub's profits by much, Strahub's profits might actually increase if offering EPL is money-losing as Starhub said.
Starhub made about S$311.3 million for year ended 31 Dec 2008, down from S$3.30.3 million, mainly becos of higher expenses of its Pay TV business (increase of S$86.5 million).
Starhub has total shares issued of 1.71 billion shares, or Earning Per Share of 18.28 cents. Last year it paid total dividends of 18 cents per share.
If starhub reduces its dividend and pays say, 16 cents per share, based on share price of S$2, dividend yield is 8%.
Starhub has about S$237 million in Cash and Debt-equity ratio is about 14.38%. Even if Starhub needs to expand, it is still possible for Starhub to maintain dividend of say, 16 cents per share.
I hope the above sharing is useful. At the end of the day, you need to make your own decision. Above comments is not meant as investment advice to you. Ultimately, we have to be responsible for our own investment decisions.
All the information I shared are obtained from newspapers and the financial information from sgx website, something accessible by everyone, including yourself. One does not even need to be a shareholder of Starhub to get hold of such information.
In the 2-day seminar, basically I've taught "how to fish". Thus, graduates of the seminar can then apply what they learned to "look for fish" themselves.
Feed a man a fish you can only fill him for a day, teach him how to fish and he'll never go hungry again. This is why from Year 2009 onwards, I'm conducting seminars to teach people how to fish (how to invest).
Actually, Singtel, Starhub and M1 all majority owned by Temasek Holdings. Competing aggressively to pay for EPL Rights only benefit "outsider who own the EPL Rights" and burn a hole "indirectly" in Temasek's pockets.
Dennis Ng wrote:jamestai wrote:13 Sep 2010
Hi Dennis,
Just wonder did you know about this REIT stock ORCHARD PARADE HOLDINGS LIMITED ?
I look at their Financial statement on 13 Aug 10, it reported that it NAV is aound $2.44. So I look at their share price today and is around $1.14. I was surprise because this is almost 46% discount from it's NAV.
And looking at it's income statment, it profit compare to the same quater last year, it has improve significantly.
It's property make up of
Orchard Parade Hotel
Albert Court Hotel
49.9% Stake in Yeo Hiap Seng
THe Floridian Condo Development
Net asset value (for the issuer and group) per ordinary share based on issued share capital of the issuer at the end
of the (a) current period reported on and (b) immediately preceding financial year.
Net asset value per ordinary share based on
issued share capital at the end of the period/year
page 11
Group
30.06.2010 31.12.2009
$ 2.44 $ 2.34
Company
30.06.2010 31.12.2009
$ 2.26 $ 2.23
James Tai
Hi James,
great. You have identified another undervalued Property stock. Yes, Orchard Parade is closely held by Far East Organisation....typically its share price is "laggard" compared to other property stocks.
However, there is no doubt about the value of the properties it own. In the last phase of the Bull run (which we are entering into), typically laggard stocks would rise much more than the Blue chips (eg. Capital Land). So, I will not be surprised if the share price of Orchard Parade would surge up in the months ahead. In year 2007, Orchard Parade's share price was as high as S$2.90.
When you buy a stock worth S$1 and pay about S$0.50, that is a Classic "Benjamin Graham" strategy......so far, whenever I used this strategy (Price to Book Value) to buy a property stock, I have always Profitted and never made a single loss before.
That's what I want from all my graduates. That you analysed a stock first and Present your findings and comments, and I would then also take a look at the stock and share with you my comments. This is how all my "multi-millionaire" sifus (teachers) teach me, and this is how I want to pass on the knowledge/experience I gained. By doing so, you Learn How to Fish for yourself, instead of me giving you a fish.
Give a man a fish and you can feed him for a day, Teach a man how to fish and he'll never go hungry again. I'm here to teach all of you (graduates) how to fish, NOT here to give you fishes. A Real Teacher's greatest satisfaction is when his students surpassed him. While a "fake teacher" who just want to earn your money want you to forever depend on him and his "trading software" so that he can milk money from you forever.
Hope my reply is Crystal Clear to you. Please note that I'm just sharing my personal comments and not giving investment advice and not advising anyone to Buy/Hold/Sell any stocks.
dragonhart2 wrote:dear Serene,
tks for sharing....yes...your employer is not your financial plan! You are! we earn, we save and we build our financial fortress....brick by brick, day by day....have faith..... one day, we can stand tall on our own. together, we can form the Master Mind Alliance and do much much more than if we are on our own....there's only so much each of us can do......![]()
cheers,
jason.sereneloong wrote:wow Jason, that was very heartfeltYou have inspired me to share:
I have always been a good student (top schools all the way) and good worker (I work on average 12 hours a day at MNCs). On the social interaction front, I was also ok, can relate to people. I am well-like at work.
But when the financial crisis hit in 2009, it was like my track record didn't matter at all. I got retrenched nonetheless along with half the department. It felt like everything I was taught didn't quite work.
The old mantra society and my parents told me: study hard and get a good job - was only half the story. Then I joined Dennis' wealth revolution, and the rest like they said, is history.
The reason I start http://www.reallifetheory.com is because I believe I can help spread practical knowledge that will make a difference in people's lives. I do up the videos based on
what I have learnt in the last 10 years of attending/reading self-improvement seminars and books which has probably cost me about $30K. Using my life as a laboratory, I only put up theories that hv worked for me,
many of them from Dennis of course!
Here's to CANI!
Serene
candy_chia wrote:Genting Singapore: BUY; S$1.46
Too much reading between the lines
Price Target : 12-Month S$ 2.05
Echo’s stake likely an opportunistic investment for now
Better off saving bullets for new markets rather than outright tussle with Crown in their homeground
Maintain Buy and SOP-based TP of S$2.05
by Yee Mei Hui, DBS Vicker (Spore)
Waterman wrote:
Hi,
The many figures we used here are estimation from the financial statements of OPHL for FY2011 back-dated to 31 Dec 2011. They are not marked to market, and hence they are only estimation.
Dennis is very prudent to use only 70% (at S$2.20) and 80% (at $2.50) to NAV. Should an investor buy in now, our usual requirement of 30% discount to NAV is not met.
The share price at S$2.07 was already at her 52 weeks range high. Investors buying now are buying against the efficient market theory, based on the expectation on past prices, past earnings, and other past indicators, and believe that expectation of past prices and the potential future earning will influence the future price. Therefore, be very careful here.
Waterman
ilovecck wrote:robinhan wrote:Hi Dennis, would you please share your opinion on IHH IPO. I found the use of proceeds, 90% is repayment of bank borrows. does that mean this IPO is likely to be initiated by bank to pay back their borrows from the bank? Thanks a lot!
Actually, for me, imho, in this case IHH is just trying to raise cash to pay and NOT trying to using the cash raised for expansion. This could have said something about the state of it financial health also.
Dennis Ng wrote:ilovecck wrote:robinhan wrote:Hi Dennis, would you please share your opinion on IHH IPO. I found the use of proceeds, 90% is repayment of bank borrows. does that mean this IPO is likely to be initiated by bank to pay back their borrows from the bank? Thanks a lot!
Actually, for me, imho, in this case IHH is just trying to raise cash to pay and NOT trying to using the cash raised for expansion. This could have said something about the state of it financial health also.
100% agree with ilovecck.
I would also look at the PE of the IPO vis-a-vis any Peers listed in Singapore, eg. Raffles Medical, with PE of 24.7 times vs IHH's 93 times (trailing earnings) and 35 (expected earnings this year).
P.S again you notice the BIG jump in Net Profits the year the co goes for IPO. A common "phenomenon" I share in the 2-day Stock Seminar.
These are the numbers and again it shows that IHH is "expensive" in terms of PE, thus, I would personally give this IPO a miss. Its coming year expected PE is 35 times, can it grow its profits by 35% or more? May not, so just by this, I would not bother to do further in-depth analysis of the company. Whatever info (use of IPO proceeds) and PE already enough info for me to decide to avoid this IPO.
Can this IPO's price go up after listing? Maybe. But I don't invest based on hope. Hope is not a strategy.
Share Price RM 2.85
Market Cap RM 22,958,753,425
Total Shares Out 8,055,702,956
Offering (27.74%) 2,234,652,000
2011 Earnings RM 245,655,000
2011 EPS (sen) RM 3.05
FYE 2011 P/E 93x
Q1 2012 Earnings RM 164,504,000
2012 Annualized EPS (sen) RM 8.17
FYE 2012 P/E 35x
Ms Tan wrote:Isn’t “flash mob” similar to what Dennis is doing in teaching Financial Freedom? Of-course this is not 100% identical, I just like to connect the dots with my own imagination, my way of seeing the world.
The way one person started the music and brings in random people together as a group to jointly play the music and grow the participation from the rest singing together is such an amazing and joyful event.
This is like Dennis started the financial education alone and orchestra to a team of Wealth Educators, Forumers & Seminar Graduates to spread the message out to others to be financially literate to achieve Financial Freedom.Dennis Ng wrote:My dream and deepest hope is someday some of you can be much, much better than me, so that all of us can then reach out to educate even more people.
I don’t see how Dennis’ dream cannot come true. I can vision that many of us will be Millionaires or Multi-millionaires with Hearts, the S$100 Million Charitable Foundation to help bridge the Rich-Poor Divide will be established very soon. Cheers!
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