I receive Saizen Reit annual report last week and I find it easy to read. For me, anything that is easy to read is a plus for me. So I decided to increase my holding in Saizen Reit. I did a simple calculation to see at what price I should buy Saizen again.
At page 2 of annual report, it stated Saizen has 1,111,002,712 issued units and 335,354,705 outstanding warrants. Eventually, Saizen will have 1,446,357,417 issued units. Saizen declare dividend of 0.26 Singapore cents base on two months’ cash flow (pg. 4) and distribution to unit holders is JPY161,912,000. Using JPY161,912,000 to forecast next year distribution by multiply 6 which equals to JPY971,472,000. Then divide JPY971,472,000 by 1,446,357,417 units equals to JPY0.672 per unit and using exchange rate factor of 0.0158, its forecast dividend comes out to be S$0.0106 next year. My goal is to collect at least 8% of dividend from my investment so I divide S$0.0106 by 0.08 which is 0.1325. Therefore, I will invest Saizen when its share price goes down to 0.135.
At the time of writing, STI is reaching 3,200, now at 3,183. To me, it’s just plain incredible. Steel demand shows no such hype. Am I wrong? There is no correlation between steel and stock.
Showing posts with label Saizen. Show all posts
Showing posts with label Saizen. Show all posts
Wednesday, October 6, 2010
Saturday, August 28, 2010
Saizen Re-start Distribution
As some may know, I use simple criteria to pick my stock to invest (please read my strategy page). Does it work? I am not too sure. But most importantly, do I follow it closely. Sadly, I really don't. If I did, Saizen should not be in the portfolio. Saizen had some serious problem with its debt and had to stop distribution after just one distribution. Also it raised money by issuing rights and warrants. Why did I buy it?
In its financial statement for Q3 ended 31/03/2010, management said they have started to accumulate cash for distribution, but did not state how much (pg. 15). So I have to make an intelligent guess and sorry to say, mine guess is not intelligent at all.
In FY2008, Saizen's gross revenue was JPY 3,578,346,000 and its distributable income was JPY 1,697,165,000 which is about 47% of revenue (pg. 3 of financial statement ended 30/06/2008). For Q3 ended 31/03/2010, Saizen's gross revenue is JPY 1,025,064,000 (pg. 2) and I assume 47% of revenue which is JPY481,780,080 will be the distributable income since that's the ratio for its first distribution. Then, 90% distributable income is JPY433,602,072 and divide this by total units of Saizen which is 952,932,055 (pg. 11) and you get JPY0.455 for dividend which is about S$0.0071 by using exchange rate of 0.0155. Let's multiply S$0.0071 by 4 which equals to S$0.0284 and divide it by S$0.16 (Saizen share price) which is 0.1775. This means the dividend yield is a whopping 17.8%. How can I not buy!
Now let's look what happen.
Management declare S$0.26 cents for FY2010 (pg. 3 of financial statement ended 30/06/2010) and this is base on the cash accumulated for months of May and June (pg. 2) so S$0.26 multiply by 6 is S$1.56 cents and dividend yield is 9.75% which is way below of my assumption. Saizen FY2010 gross revenue is JPY4,132,792,000 (pg 3) and divide this by 6 is JPY688,798,667 for two months' revenue. And May/June distributable income is JPY161,912,000 (pg. 7) which is only 23.5% of its revenue. I am not sure how this happen. Maybe the finance expenses are now a lot more costly. Also, there is a whole bunch of warrants waiting to be exercised and once exercised, dividend will be less. Did I buy the right stock?
In its financial statement for Q3 ended 31/03/2010, management said they have started to accumulate cash for distribution, but did not state how much (pg. 15). So I have to make an intelligent guess and sorry to say, mine guess is not intelligent at all.
In FY2008, Saizen's gross revenue was JPY 3,578,346,000 and its distributable income was JPY 1,697,165,000 which is about 47% of revenue (pg. 3 of financial statement ended 30/06/2008). For Q3 ended 31/03/2010, Saizen's gross revenue is JPY 1,025,064,000 (pg. 2) and I assume 47% of revenue which is JPY481,780,080 will be the distributable income since that's the ratio for its first distribution. Then, 90% distributable income is JPY433,602,072 and divide this by total units of Saizen which is 952,932,055 (pg. 11) and you get JPY0.455 for dividend which is about S$0.0071 by using exchange rate of 0.0155. Let's multiply S$0.0071 by 4 which equals to S$0.0284 and divide it by S$0.16 (Saizen share price) which is 0.1775. This means the dividend yield is a whopping 17.8%. How can I not buy!
Now let's look what happen.
Management declare S$0.26 cents for FY2010 (pg. 3 of financial statement ended 30/06/2010) and this is base on the cash accumulated for months of May and June (pg. 2) so S$0.26 multiply by 6 is S$1.56 cents and dividend yield is 9.75% which is way below of my assumption. Saizen FY2010 gross revenue is JPY4,132,792,000 (pg 3) and divide this by 6 is JPY688,798,667 for two months' revenue. And May/June distributable income is JPY161,912,000 (pg. 7) which is only 23.5% of its revenue. I am not sure how this happen. Maybe the finance expenses are now a lot more costly. Also, there is a whole bunch of warrants waiting to be exercised and once exercised, dividend will be less. Did I buy the right stock?
Friday, August 20, 2010
The Economist House Price Indicator
In my article on HDB, I said, it's still reasonable for a Holland V's 3 room flat to go down 20%. Apperantly, I am not the only who feel that way.
http://www.economist.com/node/16542826?story_id=16542826
I don't know how Economist derive their numbers, but hey it's the economist. Anyway, Economist indicate Singapore's property is 20.3% overvalued and Australia is 61.1% overvalued. Maybe I should stop keep track of MacarthurCook PSF. Japan is the most undervalued, at 34.6%. What does this mean to Saizen?
When I was a college boy in US, me and my friend rent an apartment to live. Unlike in Singapore, these apartments are not usually own by individuals, but operate by a corporate company or in my case operate by college. It's actually quite normal in the US. Singapore also has apartments operate by companies, but its usually service apartments which is quite expensive. Anyway, I like Saizen's business model and we will see if they can re-start to declare dividend on 26/08/2010.
http://www.economist.com/node/16542826?story_id=16542826
I don't know how Economist derive their numbers, but hey it's the economist. Anyway, Economist indicate Singapore's property is 20.3% overvalued and Australia is 61.1% overvalued. Maybe I should stop keep track of MacarthurCook PSF. Japan is the most undervalued, at 34.6%. What does this mean to Saizen?
When I was a college boy in US, me and my friend rent an apartment to live. Unlike in Singapore, these apartments are not usually own by individuals, but operate by a corporate company or in my case operate by college. It's actually quite normal in the US. Singapore also has apartments operate by companies, but its usually service apartments which is quite expensive. Anyway, I like Saizen's business model and we will see if they can re-start to declare dividend on 26/08/2010.
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