Friday, 26 May 2017

CAPITAMALL TRUST OR FRASERS CENTERPOINT TRUST?

CMT's Bedok Mall

Recently, there has been a lot of negative news regarding the retail industry. Island-wide vacancy stock reached 5 million sq ft or 7.7 per cent, which is equivalent to the size of about five VivoCities. To experience how online shopping has affected retailers here, I decided to work in the retail sector during my school holidays. I am currently working at a suburban mall in the east. From my observations, the prospects of the retail sector is rather bleak. Sales are tepid and the store holds quite a large amount of inventory. Most common items can also be bought online, at a lower price.  

Nonetheless, dividend-seeking investors may still be interested in retail REITs, if they are priced at a attractive valuation. Much would depend on the innovative ability of retail malls to fend off intense competition from e-commerce. Retail REITs would have to redefine the retail experience when they upgrade or develop future malls. For example, CMT's redevelopment of Funan Mall focuses on providing an experiential retail concept for consumers, allowing them to test and feel products, which online shopping cannot offer. 

Capitamall Trust (CMT) and Frasers Centerpoint Trust (FCT) are two large retail REITs listed here, and I decided to compare their portfolio performance and financial strength, to see which REIT is a better investment.

Thursday, 11 May 2017

QAF LIMITED'S STRATEGIC REVIEW



Last Friday, QAF announced that it would be conducting a strategic review of its Primary Production business, which may include a listing in Australia or a sale of the business in its entirety. I decided to write about my analysis of QAF's business segments, as well as the potential impact of the strategic review. 

Wednesday, 19 April 2017

IS KINGSMEN CREATIVES A VALUE TRAP?


Kingsmen Creatives is a company that recently caught my eye. The company has four business segments - exhibitions and thematic, retail and corporate interiors, research and design and alternative marketing. It organises events including the Formula 1 Singapore Grand Prix and the Singapore Airshow, and designs interiors for Uniqlo, DBS Bank and Coach. 

As a value investor, I constantly look for shares that are trading close to their 52-week lows. Kingsmen Creatives is currently trading at 60 cents, just off its 52-week low of 58.5 cents. When share prices of companies decline, it could either be an opportunity to purchase undervalued shares, or it could be a value trap. Understanding the fundamentals of the company would allow us to make an informed investment decision.