In an earlier article, I shared four reasons why Bumitama Agri Ltd  (SGX: P8Z) looks like a good investment opportunity at the moment after seeing its share price fall hard from its 2014 peak of S$1.23. For perspective, Bumitama Agri’s share price is currently S$0.65. But, every investment contains risks, and Bumitama Agri is no exception. So, in this article, I want to share three important risks that investors should pay attention to. The business As a quick introduction, Bumitama Agri is a palm oil producer. The company has over 180,000 hectares of plantation land located in three provinces in Indonesia, namely, Central Kalimantan, West Kalimantan, and Riau. Bumitama Agri’s primary business focus is on growing and harvesting palm oil fruits, processing them to obtain palm

According to DBS, statistically, October has a higher tendency to be positive whenever the STI declines in the months of August and September. So far, the current valuation of Singapore’s market is also very reasonable with the STI hovering around 3200 region. As such, there should be adequate cushion against the possibility of earnings cuts in the upcoming results season. To ride out the month of October, DBS recommends three investment strategies. Investors Takeaway: 3 Investment Strategies To Ride On October’s Momentum Palm Oil Stocks Enter Seasonal ‘Sweet Spot’ Historically, the price of crude palm oil (CPO) tend to peak in the month of March. It then bottoms out before mid-October followed by 2-3 months of price recovery. The October-December seasonal rise coincides with

Another business I increased exposure to in 3Q 2018 was Wilmar. As its share price went under $3.00, I simply had to buy some. At that price, I believe Wilmar was very undervalued and based simply on NAV per share, it was. ... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]

Food and beverage-related companies are generally considered as defensive stocks since their products are needed in both good times and bad. As such, the prevailing view is that the shares of these companies tend to act as a hedge in a downward market. Given the defensive nature of their business, it is not surprising to see that most of these companies trade at high valuations. As investors, we don’t want to pay an excessive price for any share we invest in. Thus it might be useful to get a quick overview of the valuation of prominent food & beverage-related companies in Singapore’s stock market. Here, we will compare the valuations of three major companies in the space, namely Thai Beverage Public Company Limited (SGX: Y92), Wilmar International Limited (SGX: F34), and Yeo H

Peter Lim, who is among the wealthiest people in Singapore, is a self-made billionaire who made his riches through investments in Wilmar International Limited (SGX: F34), properties, healthcare businesses and sports. According to Forbes Singapore’s 50 Richest list, Lim had a net worth of S$2.5 billion (as of 25 July 2018), having cashed out on Wilmar eight years ago. In 2007, the billionaire gave two separate interviews to The Business Times and The New Paper. From those interviews, I picked out some interesting pointers that investors should keep in mind when it comes to investing in stocks. Keep emotions in check The stock market can be extremely volatile. For instance, last Friday, Singapore’s Straits Times Index (SGX: ^STI) rose around 30 points. Yesterday, the index was down

The consensus is becoming wary of weaker-than-expected GDP growth and slower EPS growth. RHB thinks that investors should readjust their portfolio to seek shelter in plays that will do well in a weaker economic environment. Using a top-down strategy, RHB identified two investment themes to help investors identify which stocks to look at. Investors Takeaway: 2 Top Down Investment Themes To Position For 2H18 Investment Theme 1: Riding On The Macro Trend Of Rising Interest Rates With an expectation of four rate hikes this year, RHB thinks that SIBOR will continue to be pushed higher by US Federal Funds Rate. This bodes well for Singapore banks and should drive net interest margins up in banks. Thus, RHB highlights banks as one of its top-down investment themes. UOB Prior to the cooling mea

Palm oil is the most versatile edible vegetable oil on the earth. It is used as an ingredient in half of the products you could find in our supermarket. From edible biscuits to personal care or cosmetic products, you can bet that there are traces of palm oil extract. Notwithstanding its applications in consumer products, palm oil is also a renewable resource for biodiesel and biofuel and is a substitution for fossil fuels like crude oil. Wilmar International (Wilmar), an agribusiness giant listed on Singapore Exchange, is also one of the world’s largest palm oil cultivator and processor. In the latest quarter, Wilmar delivered a better-than-expected performance. We take a closer look to find out if the group could sustain its performances in the coming quarters. Good Earnings Despite Pol

In the current risk-off environment, we continue to highlight four defensive yield plays that safe haven seekers should invest in. Investors Takeaway: Seek Safe Haven With These 4 Defensive Dividend Plays Mapletree North Asia Commercial Trust With the addition of the Japanese assets to its portfolio in 1Q19, OCBC believes that Mapletree North Asia Commercial Trust has built a better portfolio mix. OCBC thinks that Japanese properties complement its other assets, given its longer weighted average lease expiry and lower borrowing costs in Japan on moderate growth prospects. This provides increased stability to Mapletree North Asia Commercial Trust’s unitholders. Post-acquisition, distribution per unit for Mapletree North Asia Commercial Trust grew at a smaller magnitude of 1.6 percent

Performance of Straits Times Index (STI) Constituents in August 2018 The Straits Times Index (STI) ended 106.37 points or 3.20% lower to 3213.48 in August 2018.(compared to 3319.85 on 31-Jul-2018) Top Performers: Yangzijiang Shipbuilding, Venture Corporation, CapitaLand, Wilmar International, Sembcorp Industries. Least Performers: Thai Beverage, Genting Singapore, Jardine Strategic, City Developments, DBS Group. Most Volatile: Yangzijiang Shipbuilding, Thai Beverage, Genting Singapore, Venture Corporation, CapitaLand. Advertisement Continue Reading »

Major Singapore plantations, namely Wilmar International, First Resources and Bumitama Agri posted stronger than expected results for 2Q18. The main attributes for the stronger results were the higher downstream margins and higher external fruit intake. This is in contrast with their peers which experienced weaker downstream margins. The strong performance seen in 2Q18 is expected to continue into 3Q18 as the fresh fruit bunches (FFB) yield begins to improve. Companies with downstream exposure are expected to perform better on the back of higher utilisation rate, better pricing power for refiners and higher biodiesel sales volume. Bumitama Agri Bumitama Agri (Bumitama) announced its 2Q18 results with its net profit came in within expectations at IDR388.06 billion. This was supported by str

The curtain will come down on the Straits Times Index (SGX: ^STI) earnings season for the second quarter next week. There are just three laggards left to report. It wasn’t the best of quarters when Thai Beverage Public Company (SGX: Y92) reported in May. Earnings for the second three months fell 3.2% because of a decrease in profits at its beer business and a one-off expense for its acquisition of Havi Logistics. The brewer and distiller said that Thailand’s 2% excise tax on liquor was marginal, though. Wilmar International (SGX: F34) was also on the ropes in May. First-quarter profits slumped 40% because of difficulties in Tropical Oils and Sugar. However, Oilseeds and Grains fared better. The farmer said a prolonged standoff between the US and China could affect the utilisation of

Stocks selling near their 52-week low prices might prove to be good bargains for investors. Even among the blue-chip companies of the Straits Times Index (SGX: ^STI), several stocks are trading near their respective 52-week low prices. Let’s look at three of them which are trading close to their 52-week low prices. They are Hutchison Port Hldg Trust (SGX: NS8U), Wilmar International Limited (SGX: F34) and Sembcorp Industries Limited (SGX: U96). Source: Google Finance and SGX StockFacts (data as of 24 July 2018) Hutchison Port announced its financial results for the second quarter ended 30 June 2018 on Monday this week. For the latest period, revenue and other income dipped 3.6% year-on-year to HK$2.79 billion while net profit plunged 36.8% to HK$170 million. The bottom line was hit by

An attractive stock is one with strong fundamentals sweetened by undemanding valuation that are compelling enough for investors. Here are two stocks touted to be worth accumulating at their current share price. SATS SATS is a long-term play for investors who are interested in investing in the aviation industry. As Changi Airport continues to see higher passenger throughput rates, SATS is one of the major beneficiaries as it handles about 80 percent of the traffic throughput in the airport. Further, with the opening of the fourth terminal (T4), Changi is expected to see higher traffic which means higher profitability for SATS which is handling operations at the new terminal through a joint venture with AirAsia. In the long run, SATS has chosen to diversify into different industry such as p

According to Investopedia.com, a conglomerate is … “A corporation that is made up of a number of different, seemingly unrelated businesses. In a conglomerate, one company owns a controlling stake in a number of smaller companies, which conduct business separately. Each of a conglomerate’s subsidiary businesses runs independently of the other business divisions, but the subsidiaries’ management reports to senior management at the parent company.” Do you currently own shares in a conglomerate, or are you intending to invest in one? One of the challenges in determining whether a conglomerate is a worthwhile investment is figuring out how to value its businesses, since these businesses could run independently. Because I attended the Boustead EGM and Wilmar AGM recently, I de