Investment Ideas (Jul 2016) - FCL Again??

In May, I shared my investment idea to buy Frasers Centrepoint Ltd (TQ5) here. Today, in July, I am reiterating my confidence in this counter.

Source: shoppingmalls.com.sg

In May:

Current price: 1.64
Expected Dividend yield: 5.2%
Trading plan: Buy and hold long term @ 1.63 & below. Dividend play but will sell if price is right.

Now in July:

Current price: 1.505
Expected Dividend yield: 5.7%Trading plan: Continue buying even if it falls below 1.50.


Reasons:

1. Attractive valuations, i.e. huge discount to NAV.
2. Laggard amidst the recent world equities rally. (FYI, S&P500 futures hit new all time record highs with a gap up, such bullishness...
3. High proportion of recurring income, so dividend strength is better.
4. High dividend yield right now. It is comparable to a Reit, which pays at least 90% of its profits as dividends, but at the same time a growth stock.
5. Low interest rates for debts.

Risks:

1. Hastened interest rate hikes.
2. Property market cooling measures in Singapore not lifted for a long time.

Final verdict

Rewards >>> risks. 

I am also willing to hold through the trough if it falls deeper. Confidence in its dividends yield.