Tuesday 9 April 2024

Portfolio Updates + Recent Thoughts (As of 9 April)

I just decided to post an update because there is a chance the returns might get lower as the year goes lol.

(Pretty and Cute)

Portfolio Returns as of 9 April 2024: 10.77%

The top 3 holdings of the portfolio remains largely the same trio. Dream, Huationg, San Miguel

San Miguel - Await May 1Q 2023 Results of its Parent Company San Mig Brewery. 

Currently, HK Beer Domestic Exports are up 14% in first 2 months of 2024 compared to 2023. Encouraging but March 2023 is a high export month so will have to continue to monitor as well.

As mentioned in my facebook post, the highlight of the annual report will be the rental amount is estimated to be higher in 2024 compared to 2023 and also a longer term rental lease is locked with the new anchor tenant.

Huationg - I have wrote up my view on the annual report in this facebook post. The highlight would be the refundable deposits being around 30% higher. This is usually a indicator for revenue moving forward as deposits are usually 2 months of rental. I hope i will be able to have time to attend the AGM.

Dream - I have mentioned in my previous post so i will not be talking much more about it. I will be attending the AGM and hopefully i will have more insights to share following the agm.

Recent Thoughts

HK Domestic Consumption 

In my recent trip to HK, it was a long weekend therefore a lot of Hk-ers were overseas. As such it seems pretty quiet and trains were less packed. I would say at least 60% of the people i see at restaurants / cafes / shops are mainland chinese.

The Harbour City was not packed on a Sunday Lunch Time. As such i am actually slightly worried about March Retail Sales and the whole tourism sector as a whole. It seems like the trend of HK-ers going China to buy cheap goods is growing while the reverse trend is not happening.

As such, F&B outlets, retail outlets, HK Reits are things that i was not keen on looking and after this trip i would still not be keen.

I am keen on EGL Holdings (HKEX: 6882)  A tour agency business in HK, but the gearing is too high making it scary and there are some financial loans from a related company as well.

Vietnam Consumption

From what i have seen, it seems like Vietnam consumption patterns have improved largely since Sept 2023.

(Positive Results Seen in Q1 2024)

(Affirmed by Bach Hoa Xanh (BHX), a Vietnam grocery operator, with 47% increase in revenue in first 2 months of 2024 vs 2023)

(Down 11% at December 2023)

(Down 16% YOY at Sept 2023)

1 way i try to assess how the economy is doing is to look at how Mobile World Investment Corp is doing.

It is a company that is Vietnam's No.1 multi-category retail platform by revenue and has different shops which sells mobile phones, electronics, groceries , medicines, kids products.

As such, looking at its revenue, it seems like domestic consumption has recovered.

This seems to echo the thoughts of Masan Group , another large conglomerate in Vietnam.

From its Earnings Release back in Jan 2024.

As such, a company that has re-entered the consideration list will be Golden Resources Development (Hkex: 677)

With convenient stores business in Vietnam, i wonder how much it will benefit from this recovery. 

Another company to consider is Luks Group (VN) (Hkex: 366) with its main business being cement production in Vietnam. Unfortunately, the property sector there is also undergoing downturn and the company's cement production is unprofitable in 2023. Looking at the Index of Industrial Production for Cement, the first 3 months of 2024 is still lower than 2023. This signals that a recovery is still some miles away.

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