Thursday 29 February 2024

(February 2024 Results) How i would invest in the singapore stock market if i had 100k of spare money


February 2024 Returns: 3.51%

Year to Date Returns: 2.94%

Since Inception (9 Sept 2020) Returns: 79.47%

Main Companies that gave a positive return include UMS, Straco and Centurion

I believe the returns might look very different if i did the recording on 1st March as many companies reported result on 29 Feb itself.

Nevertheless. lets review the many companies that reported results

Straco - Perhaps the latest addition but i think the results is a big disappointment.

Q3 = 35m revenue and 16.3m profit
Q4 = 15m revenue and 2.9m profit.....

Moving forward, it puts some ? to how we should see and value this.

A company earning 12m per year vs a company earning 65m per year ....the range in between is too big. 

Score: 2/10

UMS - Always a stable dividend and results seem to be stable as well. With new factory operational in penang and expectation of uptick in order flow, nothing much to worry about as it has navigated poor semiconductor 2023 very well. Just have to see neighbor stocks *coughs* AEM to know.

Score: 5/10

Sutl Enterprise - Results Stable, Financial Position Improves. Have to see if 2024 is a year where overseas projects get traction. Locally, need to keep an eye on cost as expenses has increased more than revenue.

Score: 6/10

Haw Par - Big Thumbs Up from Me. I like the results very much. Revenue Increase from 148 million to 216 million

The increase in revenue of its healthcare goods is something very heartening to see.

1H 2022: Revenue 86.7m. Segment Profit 17.7m
2H 2022: Revenue 77.3m. Segment Profit 22.4m
1H 2023: Revenue 101.7m Segment Profit 29.1m
2H 2023: Revenue 111.7m Segment Profit 35.6m

Overall it remains a very deep value stock. In fact i think if it considers spinning the healthcare business it would look good. But the odds of such things are not high and it is not worth thinking much about. Full Year 40 cents Dividend is acceptable. Not Great but since the business has done well and shown good growth, there is nothing to worry about especially it is in very strong cash position.

Score: 9/10

Centurion - Stable. Not much Surprises. If core earnings can maintain or grow 10-20% would be great.

Score: 5/10

Huationg Global - This is actually tough for me to comment and give an honest take. Perhaps i talk about the negatives first. The same dividend amount is perhaps the most upset part of things.

The second most upset part of things will be the dormitory margins. In 1H 2023 , 8.8m segment profit
However, in full year it is 8m segment profit.

However if we were to include the 'Unallocated' expenses. 1H 2023 Segment Profit will be 3.862m while in 2H 2023 it will be 3.888m. Which looks like it remains stable despite slight revenue improvements.

3rdly, they moved backed the asset that was held for sale back to non-current assets again. Which indicate no near term intentions to sell the property again.

Moving on to the positives and maybes....... 73 million of Net Cash From Operating Activities. This is contributed by an increase of 27 million of trade and other payables. Could the additional refundable deposits indicate a higher rate moving forward?

1stly. Cash Position Improved from 23 million in 2022 to 70 million in 2023. Of course part of it is contract liabilities and part of it would be from the dormitory deposits. Nevertheless, this is a good improvement as the cash flow of the company has improved and if high payables is due to dormitory then it will be good.

2ndly. Improvements in Civil Engineering Contract Margins. 

This is coupled with an orderbook of 506.5 million. A huge increase from End of 2022 whereby it was 415 million. A slight increase from 30 June 2023 where it was 484.4 million.

Lastly. Overall Increase in Net Profit.

It is always good to see that profit before income has improved even after deducting other income.

Also, the lower loss allowance might signal a better business environment moving forward.

I would give this result.........7/10. Considering that the current PE is 1.83 and cash position improved with positive cash flow it deserves a decent score instead of a fail score. But i think there are a lot of questions to think and ponder about.