Thursday 28 March 2024

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


March 2024 Returns: -2.93%

Year to Date Returns: -0.07%

Since Inception (9 Sept 2020) Returns: 74.21%

There is nothing much to report about with regards to March as companies already reported their results in February.

One thought that i had in mind was whether to shift Huationg Global out of the portfolio in this imaginary portfolio as well as my real portfolio.

Why sell out?
-Despite decent results, one of the major shareholders was disposing shares and as such it might have proved tough for the stock to record any capital gains

-On the other hand, dividends was conservative and somewhat not really ideal.

Why not sell out?
-Does not make sense to sell out of a stock that is <2 PE and has good cashflow and reduced debt

-Increase in refundable deposit might signal higher dormitory revenue moving forward

-Effort needed to replace the stock. As always, if there is something else that caught my eye then it would make the switch more attractive. Push/Pull.

With this thought parked somewhere at the back of my mind, i embarked on a trip to Korea in March. After returning, my mind is pretty much set on not selling for the time being.

So what happened in the trip to Korea?

I met a fan who is also from Singapore. It happened just so that we were both there to support the same group and i had a chit chat with him.

Turns out that he works in a foreign owned construction firm in Singapore and in the finance department.

We then had some chit-chat with regards to the construction sector the past years and in 2023/2024. 

I mentioned that dormitory prices have been increasing and asked if he was aware of it. 
Turns out that he does know the prices of the dormitories that his company has been paying and the terms. This instantly sparked my interest to know more and i also treated him a meal as well.

(Huationg Global Dormitory Revenue from its Results)

It is always good to hear from a view of a customer.

From my understanding, some of the dormitories that they are paying could easily go up to 660 per bed per month. This is of course dependent on where they stay etc. 
After typing for so long, the question would be ? does he know anything about Coastal Dormitory? Turns out he i was able to get the rate that his company is paying currently as well as when was the last time the price was changed and more information such as prices in the past year etc.

Unfortunately Coastal Dormitory is actually one of the 'cheapo' dormitories around. As you can see from the 2H 2023 results, price per bed is only 395 when beds can be going up to 600+. Due to its inaccessible location and being located far from many construction projects apart from the T5.

I will not be saying the price that they are paying as it is sensitive information (lol). But all i can say is that i expect 1H 2024 Revenue to be higher than 2H 2023.

Low Teens increase(from 2H 2023) in revenue is something that i would expect to see based on my understanding. However this is subjective because some folks might have renewed earlier while some later and as such rates can vary for everyone altogether as well.

So for now i will be staying put and holding my position (at least until the AGM is over, which i hope i would have time to attend)

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