Thursday 6 November 2014

Understanding JCET Offer Price for StatsChip Pac

StatsChips Pac was halted for the past few days and the result just came out this afternoon.

JCET offer USD $780 to buy all Statschip Pac Asset except the Taiwan Subsidiaries. In the notes to the announcement, it also stated that this is translated into fully diluted offer price of SGD $0.452 per share.

Following the announcement, retailers are confused as to how much should StatsChip Pac shares be traded, due to the following reason=>

  1. The price of share traded on SGX is mark on an undiluted basis.
  2. Price quoted on SGX include Taiwan Subsidiaries
The purpose of this post is to help retailers understand  JCET's offer price on a (1) undiluted and (2) complete basis.

In the following image I used the geographical locations of Fixed Asset's book value (from StatsChip 2013 annual report)  to estimate how much the Taiwan subsidiaries should worth under JCET offer.



Estimation revealed that StatsChip Pac should be traded at $0.525 per share now. Although offer from JCET was not accepted by shareholders yet but high chance it will be accepted as Temasek hold more than half of the shares. 

I am still holding on to some StatsChip Pac bought at a high of $0.63 (Click here for detail), I will cut tomorrow.


Tuesday 14 October 2014

Performance Review: Valuetronic

Performance Review On Valuetronic


Shorted Price: $0.53 on 22nd July 2014 (refer to my sell call here)

Target price: $0.34

Buy-Back Price: $0.32 Today

Profit / Loss (after deducting Comm and Script borrowing cost): 63.5%  over the tenure of 3 months


Comment:

I have covered all my short position on Valuetronic. It is a bonus that I am able to buy back 2 cents below my target price.

I am very satisfy with the high profit of 63.5%, especially considering it was made over a short tenure of 3 months only.

One friend asked me whether I think the current price is a good buy, my answer is no. Even though current price is below fair value, the safety margin is still too small to be of any comfort. Furthermore following the recent deep correction in stock market, there are lots of other opportunities offer much more attractive return per unit of risk than Valuetronic. I would give Valuetronic a miss at the current price.




Cheers.

Tuesday 30 September 2014

Closing Noble

In my previous post this morning, I bought Noble for $1.29 for speculative play. (refer to previous post here)

Target of $1.36 was not achieved. So I sold all my Noble holding @ $1.305 at end of the day.


Return=> Meager 0.7% after commission




Monday 29 September 2014

Speculating On Noble

Hi, Noble is drastically oversold today.
Given Noble Beta of 1.6===>>>> It should have fell around 2% today instead of the 7%.
Also Olam, a similar (not same business) only fell by 1.2%. Hardly in tandem with Noble's movement today.
I am betting it will recover by mid day.
Good Luck to me
Target 1.36
Entry 1.29

Note that this trade is a speculation for quick gain. I have yet to do detail analysis on Noble. Follow at your own risk.

Monday 15 September 2014

China Jan.-Aug. housing sales down almost 11%

Source: http://www.marketwatch.com/story/china-jan-aug-housing-sales-down-almost-11-2014-09-14

China Jan.-Aug. housing sales down almost 11%

BEIJING--Housing sales in China in the first eight months of the year fell 10.9% to 3.43 trillion yuan ($559 billion), according to data from the National Bureau of Statistics issued Saturday.
Sales in the first seven months of the year were down 10.5% from a year earlier at 2.98 trillion yuan.
Property developers across the country have been struggling with weak sales, bulging inventories and tight credit conditions since the start of the year, and some authorities, mostly at the local level, have been loosening policies to support the sluggish market. Analysts and investors are closely watching for signs recovery in the housing market, which is an important driver of China's economic growth.
More than 30 local governments have loosened property restrictions such as limits on second home purchases, but buyers are staying on the sidelines because they expect prices to fall further on rising inventories.
Many Chinese property developers said in their first-half earnings reports that they expect to sell the bulk of their inventories in September and October, which are usually the peak months for property sales.
New construction starts in the January-August period measured by area fell 10.5% to 1.14 billion square meters. This compared with a decline of 12.8% to 982.3 million square meters in the first seven months.
Property investment in the first eight months of this year rose 13.2% to 5.90 trillion yuan, slowing down from the 13.7% growth in the first seven months. The investment figures are a lagging indicator, and reflect ongoing activity in projects that started last year. New construction starts grew 13.5% in 2013.
The statistics bureau doesn't give data for individual months.
Esther Fung, Liyan Qi

Friday 12 September 2014

European states struggle with Draghi's challenge

Source: https://sg.finance.yahoo.com/news/european-states-struggle-draghis-challenge-081909375--finance.html


European states struggle with Draghi's challenge

Eurozone governments challenged to increase spending, shake up over-regulated economies

MILAN (AP) -- Eurozone finance ministers on Friday said they were willing to help the European Central Bank in its plan to save the economy. How much they can do in practice, however, remains unclear.
The ministers met for the first time since ECB President Mario Draghi sketched out this month what has been dubbed "Draghinomics:" a three-pillared strategy including more stimulus from the central bank, added government spending and pro-business reforms to cut bureaucracy and make economies more productive.
The ECB covered the first pillar, offering a range of new stimulus measures at its last meeting. Governments from the 18 euro countries hold sway over the other two, but have been either reluctant or unable to act.
Jeroen Dijsselbloem, the Dutchman who heads the eurozone finance ministers' meetings, said Friday that governments are now ready to shift their focus from stabilizing financial markets to promoting growth.
Eurozone states, he said, should complement the ECB's efforts to boost the economy with "a credible mix of fiscal policies, structural reforms and investment."
"We all agree the euro area needs to increase this growth potential and create more jobs," Dijsselbloem said.
Europe's economy showed no growth in the second quarter. That followed four quarters of unsatisfying recovery from a crisis over high government debt. Unemployment remains at a painful 11.5 percent.
Draghi, sitting nearby, expressed satisfaction that there was agreement in the meeting that "to see investment return we need structural reform."
To get the economy going, governments will have to back up their words with actions. Some of the key reasons they have not so far:
—With tight EU rules on public deficits, there's little room for more government spending on projects that would help economic growth.
—The push for pro-business reforms in two of the more troubled countries, France and Italy, faces political headwinds.
—Germany, the dominant eurozone country, has backed calls for more investment spending, but excluded borrowing money to do it.
—There is talk of an EU-level investment fund to pay for infrastructure such as roads and bridges, but the details are far from filled in.
In Milan, the ministers' focus on reforms included the need to reduce the tax burden on labor, noting that the eurozone's overall tax burden is above the average for developed countries in large part due to the tax wedge on labor.
They did not, however, say they would ease European Union limits on borrowing. For some countries, borrowing more money to invest can help economic growth if the money is spent fruitfully.
EU rules limit national deficits to below 3 percent of GDP to ensure stability of the shared currency. Yet a strong focus on reducing deficits can choke off growth that is needed both to shrink debt and reduce unemployment.
Italy and others want to change how the EU calculates member states' deficits so that governments are allowed to keep some spending as long it helps economic growth, the EU official added. That idea has been opposed, however, by Jyrki Katainen, the new vice president of the European Union's executive commission, and by German Chancellor Angela Merkel.
Dijsselbloem ruled out any changes to the rules. He said they did not discuss a French request for more time to bring its deficit back below the 3 percent ceiling.
Italian Economics Minister Pier Carlo Padoan suggested a close focus on deficit limits was not appropriate at a time of economic weakness. He said that for Italy, bringing its deficit to 2.6 percent of GDP this year, as it currently aims to do, "was a goal compatible with a different macroeconomic picture."
As the meeting got under way, Italian Prime Minister Matteo Renzi sent a defiant tweet: "We respect the 3 percent. We are among the few who do. We therefore don't expect lessons from Europe but the 300 billion euros of investments."
Renzi referred to a European Commission proposal to get 300 billion euros ($388 billion) in public and private investment to revive the economy.
Dijsselbloem said that issue would be taken up by the wider meeting of European Union finance ministers on Saturday.
___
McHugh reported from Frankfurt, Germany. Juergen Baetz in Brussels contributed to this report.

Magnus Energy Chief Sued by Broker Over Stock Rout

Source: http://www.bloomberg.com/news/2014-09-12/magnus-energy-chief-sued-by-broker-over-stock-rout.html

Magnus Energy Chief Sued by Broker Over Stock Rout

Deutsche Bank AG (DBK) brokerage sued the managing director of Magnus Energy Group Ltd. (MAGE) in Singapore to recover an unpaid trading debt.
Lim Kuan Yew owed DMG & Partners Securities Pte S$1.77 million ($1.4 million) for Blumont Group Ltd. and Asiasons Capital Ltd. shares bought in October, according to a lawsuit with the Singapore High Court. Singapore trading rules allow investors three days to pay for their stock purchases.
The Monetary Authority of Singapore and the police are investigating suspected stock-trading irregularities related to drops in Blumont, Asiasons and LionGold Corp. in early October 2013 that slashed $6.9 billion off the combined value of the shares. Magnus has been asked to assist in the probe, including providing electronic data and trading records of two executives.
Michelle Chia, a DMG spokeswoman, declined to comment. DMG is a venture betweenMalaysia’s RHB Capital Bhd (RHBC) and Deutsche Bank. Lim, who also traded in LionGold shares, according to court papers, didn’t answer four phone calls to his office.
Magnus Energy has said its business won’t be affected by the probe. Magnus Energy fell 7.7 percent to 1.2 Singapore cents as of 12:01 p.m. in trading in the city, extending this year’s slump to 64 percent.
DMG’s lawyers have tried unsuccessfully on three occasions to serve the lawsuit on Lim in Singapore, according to court papers filed last month. The brokerage said in court papers it’s attempting to serve Lim in Malaysia, where he’s believed to be residing.
Asiasons, Blumont and LionGold have said they don’t know what caused the sudden declines, which spurred brokers to clamp down on margin lending and dented trading sentiment.
Stock trading volume in the city tumbled about 32 percent from a year earlier to a daily average of S$1.05 billion this year through yesterday, data compiled by Bloomberg show.
The case is DMG and Partners Securities v Lim Kuan Yew, S694/2014. Singapore High Court.
To contact the reporters on this story: Andrea Tan in Singapore at atan17@bloomberg.net; Jonathan Burgos in Singapore at jburgos4@bloomberg.net
To contact the editors responsible for this story: Douglas Wong at dwong19@bloomberg.netDave McCombs, Terje Langeland