Invest SREITs at all-time low or better to go into Bond Investment Instead?

I am having a headache recently with regard to my upcoming regular month end of additional capital injection into the investment portfolios. On one hand, SREITs have tanked again to near their 52 weeks low and now seems the best time to invest. Saying that, in particularly for the past few months, whenever I thought that the SREITs prices have bottomed and accumulated more units, their price just dropped further. On the other hand, my investment forage into bond unit trusts over the past 1 year has been stable thus far especially with global inflation under control- interest income which I had received is around 6% return per annum and capital price of the bond fund held their ground well. Moreover, there is also potential further capital appreciation once interest rate cuts by the US Federal Reserve is announced.

1. Invest SREITs at all-time low or better to go into Bond Investment Instead? 

I think that I will probably add on to the bond unit trusts for June 2024 month end as I have previously in May 2024 already invested approximately S$10K into both United Hampshire US REIT and Frasers Logistics & Commercial Trust  (unfortunately, both SREIT's unit price declined further after my respective purchases).

2. A close friend asked me whether Equities or Money Market Funds is the best investment in view of current market?

I thought that my friend asked me a very interesting question. My personal thoughts are that for risk averse folks who find equities and bonds extremely risky, then maybe buying into the Money Market Funds is well worth it. Singapore Saving Bonds or T-bills are also good options. 

The thing is that over the years, I have decided to just keep my real thoughts to myself whenever risk averse close friends asked me such question. I will at most just share my thoughts on the above financial instruments since their risk profile is extreme prudence and they generally ask for the sake of affirming their own beliefs (if you say something else, then it gets into a heated debate). However, the fact remains that returns from such investments will barely keep up with inflation. I think that some risks need to be undertaken in order to exit the rat race earlier.

Ok, that's all for today's post, have a great week ahead folks!   

SREIT With Lowest Gearing Ratio and Attractive Distribution Yield of over 7%.

Hi Folks, today, I will be looking into this S-REIT that has one of the lowest gearing ratio among the top REITs in Singapore as well as its very attractive distribution yield of over 7%. 

Please see below for my latest video on YouTube channel. Going forward, I will be posting various exclusive investment contents onto my YouTube channel only. Please subscribe to my YouTube channel also to get the latest content for sharing.

Penny Stock Oceanus Group Roared Back To Life.

Recently on 29th May 2024, Oceanus Group announced a RMB 200Mil investment intention agreement with the Shaoxing Huangjiu Town local authority to help grow its alcohol distribution business in China. The town of Shaoxing is known since ancient times for producing yellow wine such as the famous "Nu Er Hong". This will give a boost to its future earnings via its already well established current distribution network painstakingly built up over the years. From this partnership, the local partner will import alcohol distributed by Oceanus, and on the other hand, Oceanus will help expand the distribution and grow the demand of yellow wine produced by Shaoxing.

1. Major Shareholder, Alacrity Investment Group, Mops Up Additional Shares from Market.

Alacrity Investment Group, the largest shareholder of Oceanus Group, has further raised its stake in Oceanus Group to express its vote of confidence in the future prospects of its investee. On 30 May 2024, it acquired 30 million shares for a total of $300,000 from the open market. The following day, it acquired another 25 million shares for $265,000. Following these two transactions, Alacrity now owns 4.43 billion shares or 17.25% of the company. The average price of the purchases is thus around S$0.01 per share. This seems to indicate that the major shareholder is extremely optimistic about the future of Oceanus Group.

2. Historical Oceanus Group Price Recap.

In 2022, Oceanus Group placed out additional 5.2 per cent of its existing share capital with Alacrity also taking part at S$0.023 per share. 

I recalled that in April 2021 I have ventured into Oceanus at S$0.038 per share and exited at around S$0.040 per share a few months later (Oct 2021). Interestingly, Oceanus Group went on to make losses despite initially getting out of the watchlist of SGX after its current CEO turn the business around. Its current prices has plunged to S$0.009 to S$0.01 per share this week.  

3. Financials

While Oceans Group is still making losses for its latest FY2023, it has managed to reduce its losses to <S$2.2Mil> relative to FY2022 staggering losses of <S$11.7Mil>. With the continuous growth in its trading business and topline revenue generation, FY2024 maybe the year of breakeven with some profits.

Parting thoughts

I think that Oceanus Group is roaring back to life with the results of the transformation work set in place for the past 4 years gradually surfacing. Hence I decided to take up a minor position in Oceanus Group again with 65,000 shares @ S$0.01 per share. Perhaps, Oceanus Group is finally ripe for harvesting. 

S-REIT With 10.7% Dividend Yield and Consistent Occupancies & Resilient Results Plus Key Risks To Note.

Today, I will be looking into this S-REIT that does not have much analysts coverage and that its market unit price has plunged close to almost 50% of its IPO price back in 2020 albeit resilient results and high occupancies of over 95% for the past few years.

Please see below for my latest video on YouTube channel. Going forward, I will be posting various exclusive investment contents onto my YouTube channel only. Please subscribe to my YouTube channel also to get the latest content for sharing.

Investment Portfolios Updates (26 May 2024) - Net S$602K and Projected Annualised Passive Income of S$41K.

These past 2 months have been absolutely horrendous for investors that held SREITs in high concentration in their investment portfolios. It is like putting money into a blackhole where it just kept pulverising. The only good thing is that I have diverted most of my new funds, as well as dividends received recently, into the bond funds on Endowus platform. Lots of further work in progress to diversify the portfolios further from real estate related investments.   

1. Portfolio 1- Stocks held in SGX Central Depository 

(Note: This portfolio is designed to provide immediate dividends for use as it is under my own CDP account and the dividends credited goes directly to my bank account.)

Have decided to sell off all my Netlink Trust units for now as there seems to be better opportunities out there. Also, the 6.1% distribution yield from Netlink Trust are not sustainable for the long term as Netlink Trust is actually paying out distributions from bank borrowings. Please see my YouTube Video here: "Netlink Trust 6.13% Distribution Yield Unsustainable and Ballooning Accumulated Losses of -S$617Mil".

2. Portfolio 2- Margin purchased securities

(Note: My margin purchased securities has grown to a sufficient scale to sustain itself and can pay off annual financing charges as well as to gradually pay down the margin loan through dividends generated.) 

The valuation of SREITs in my margin portfolio continued to nose-dive. Dividends from stocks were used to pay off margin loan financing as well as foraging into the HKEX in the form of Ping An and Link REIT after seeing signs of recovery in the China and Hong Kong market. 

3. Portfolio 3 (with Tiger Brokers and MooMoo) 

(Venture into higher risk as well as capital growth stocks here)

I opened up another online trading account MooMoo here to further diversify the online brokers and also the lower commission on offer by MooMoo. MooMoo is also giving away more than S$280 worth of US shares for signing up. Have took up additional stakes in Alibaba as well as Ping An Insurance. 

4. Portfolio 4 (Endowus Unit Trusts & Other Investments)

I have continued re-investing dividends from my Portfolio 1 mainly into the bond funds on Endowus platform. The market value for Endowus bond fund approximates the historical cost (with the exception of Income Insurance share price) hence I did not make any further fair value adjustments. From various sources that were using Philip Securities, privately held Income Insurance seems to be trading privately from S$20 to $22 per share on the blockchain powered Alta digital exchange platform. Logically, I think I should be selling it off if it is really at more than 100% capital gain and then reinvesting the proceeds. Nevertheless, since the amount I am holding is just a small stake, I think I will just keep it as a form of souvenir. 

Netlink Trust 6.13% Distribution Yield Unsustainable and Ballooning Accumulated Losses of -S$617Mil.

I was looking through the FY2024 results of Netlink Trust ending 31 March 2024. It was shocking to see that once again, it is still paying out excessive distributions. Its accumulated losses ballooned to <-S$617Mil> as at 31 March 2024. Apparently since this is a "Business Trust", it is thus "ok". Today, I will be sharing my thoughts on the latest results in the following video and the key risk to take note if one were to invest in Netlink Trust.  

Please see below for my latest video on YouTube channel. Going forward, I will be posting various exclusive investment contents onto my YouTube channel only. Please subscribe to my YouTube channel also to get the latest content for sharing.

Alibaba Full Year Results- Don't Miss the Forest For the Trees.

Not sure why many analysts were extremely disappointed with Alibaba for missing earnings expectations which brought about a sell down in the US market. On the contrary, I thought that Alibaba did fairly well for its last March Quarter 2024 and full year. Revenue continued to grow by 7% on a year to year basis for Q4. So clearly, Alibaba seems to be returning to growth mode. I will ignore the "Net Income" due to the "fair value" mark to market for its non-core business activities (public listed investments) and focus instead on the non-GAAP net income.  Also interestingly, Alibaba is going to pay out dividends again!

1. Not too bad results- investment for topline revenue growth

Q4 March 24 Results

The non-GAAP net income for Q4 ended 31 March 2024 decreased 11% from  RMB 27,375Mil to RMB 24,418Mil. Nevertheless non-GAAP diluted earnings per share decrease only 5% year on year due mainly to share buy-back (please see below).

2. Share Repurchases

Share buy-back

US$4.8 billion was spent buying back ADs and shares in US and Hong Kong markets respectively. This help mitigate the earnings per share decline due to latest strategies to re-ignite growth in Alibaba's business. 

3. Fantastic upcoming pay out of regular cash dividends and special dividends to rewards shareholders.

Wow, Alibaba really seems to be becoming a dividend stock. Total year end approved payouts will be a total of US$0.2075. I am currently holding on to about 2,300 shares. So this translates to a dividend of US$477.25. Less off withholding tax of 10% and the quantum we are looking at is thus US$429.53 (S$580) on 3 July 2024 (Wednesday). This is a respectable sustainable dividend yield of almost 2%. Ex-dividend date is on 3 June 2024.

Parting thoughts

Today (15th May) is Buddha's Day in Hong Kong and a public holiday. Once the HKSE open on 16th May 2024, the price will probably drop by 5%-6% to mirror the US market. If there is another strong pull-back on the 9988 counter, I may look into accumulating more Alibaba shares.