New addition!

Source: todayonline.com

Shared my humble portfolio of SGX counters, it is updated every evening (7 or 8pm). Scroll down all the way to the bottom to see. Enjoy.

Welcome comments and discussions.

Cheers!



Credits to sgxcafe.

ARA Asset Management: Updates from the AGM April 2016

If you have not read my last Investment Idea post, follow the link.

Updates from the latest AGM

Stable business

1. The board of directors are rather confident in the company, some have bought shares recently using their own money.
2. CEO assured that core business is REIT management, which generates recurrent income unless ARA loses position as manager.
3. Has been overperforming in terms of Assets under management (AUM) growth, vision to hit 40 billion AUM in near future, which CEO deem is world-class.

Drivers for growth

1. Trend that money from within South Korea, China and Hong Kong are moving out of  their country for investments. ARA is benefiting from this trend with their private funds set up in these countries.
2. Currently also making progress in Australia using the same strategy.

CEO's reply to query on last rights issue

Image source: forbes.com

1. The funds raise are not to clear debts but expansion.
2. Used as seed capital in REITs and private funds.
3. Seed capital is relatively low at <2% compared to competitors' 4%.
4. If never raise capital, would be to cut dividends.
5. ARA is asset-light company, so does not enjoy easy loans from banks.

Guidance on dividends

Image source: nasdaq.com

1. CEO admits that payout ratio is high but is committed to maintain 5cents per year for dividends.
2. The Board will consider shareholder's suggestion of scrip dividend option, where dividends are paid in terms of shares.

Investment Ideas (April 2016) - ARA

ARA Asset Management (D1R:SGX)
D1R Google finance Summary
Current price: 1.16
Expected Dividend yield: 4.3%
Trading plan: Buy and hold long term @ below 1.10

Background

ARA Asset Management Limited (“ARA”) is a premier integrated real estate fund manager in Asia. It manages familiar names like Suntec Reit.


Why I buy?

1. Gives exposure to reits 
2. Stable and sustainable dividends at $0.05/year 
3. $1.00 is psychological support level. Plus that is also the price of the latest rights issue 
4. Last FY results was a bit of a confidence booster amidst the equities selloff in Dec-Jan.

Disclosure: Already vested below 1.10, am looking to increase holdings should it fall below 1.10 again. So, if you are new to this counter and current price feels good to you, feel free to go ahead and buy. There is much potential for upside for price. DBS set a TP of 1.5X early this year.

That's my investment idea this time round, DYODD.