Hong Leong Asia

(02-02-2015, 09:58 AM)propertyinvestor Wrote:

(31-01-2015, 05:34 PM)sgpunter Wrote: I have been holding undervalued Kwek stocks like Hong Leong Asia and Hong Leong Finance for awhile and kind of just gave up any hope of them realizing the true value of these counters. The problem is that the Kweks have no need for money and don't see the need to sell off assets. I think passing down the businesses from generation to generation is more important to them and they are happy to just give out dividends year after year.

I still remember the time when there was speculation of Hong Leong Asia being divested and the price shot up to $5! Just imagine...at that time there was a lot of promise about Xinfei but i think Xinfei is clearly not as valuable now...

This is the reason why you need an asset stripper to come into the picture. Although xinfei is not as valuable now, their stakes in Tasek and China Yuchai has become much more attractive.

Yuchai is listed in the US and its underperformed rather badly all these years... surely it'd make more sense to invest directly in Yuchai if the stock is indeed undervalued.

(02-02-2015, 03:29 PM)sgpunter Wrote: Yes an asset stripper coming in would certainly be nice. I have been sitting on losses for HL Asia for a long time...Question is who?

Another thing I do not like is their investment in HL Global. HL Global is in my opinion a junk stock that has been suffering losses year after year yet HL Asia has been steadily accumulating shares in this counter for whatever reason. I believe sometime back a shareholder also complained about this issue.

China yuchai also has a substantial stake in HL Global. In my opinion, the investment is not that substantial. Tasek and Yuchai is the main engine of growth.

The ex COO of Tat Hong has also now returned to join them back to take charge of Rex. This is good news for HLA and something for shareholders to look forward to.

(02-02-2015, 08:29 PM)lilvestor Wrote:

(02-02-2015, 09:58 AM)propertyinvestor Wrote:

(31-01-2015, 05:34 PM)sgpunter Wrote: I have been holding undervalued Kwek stocks like Hong Leong Asia and Hong Leong Finance for awhile and kind of just gave up any hope of them realizing the true value of these counters. The problem is that the Kweks have no need for money and don't see the need to sell off assets. I think passing down the businesses from generation to generation is more important to them and they are happy to just give out dividends year after year.

I still remember the time when there was speculation of Hong Leong Asia being divested and the price shot up to $5! Just imagine...at that time there was a lot of promise about Xinfei but i think Xinfei is clearly not as valuable now...

This is the reason why you need an asset stripper to come into the picture. Although xinfei is not as valuable now, their stakes in Tasek and China Yuchai has become much more attractive.

Yuchai is listed in the US and its underperformed rather badly all these years... surely it'd make more sense to invest directly in Yuchai if the stock is indeed undervalued.

Yuchai is undervalued. But it has always been overlooked by the market since there are some complaints that minority shareholders cant really exert influence on the management due to the golden share structure of CYI.

But this is a small issue because there are many companies in the US where the MI has little or no voting rights like Facebook and all the various tech companies.

(02-02-2015, 08:33 PM)propertyinvestor Wrote:

(02-02-2015, 08:29 PM)lilvestor Wrote:

(02-02-2015, 09:58 AM)propertyinvestor Wrote:

(31-01-2015, 05:34 PM)sgpunter Wrote: I have been holding undervalued Kwek stocks like Hong Leong Asia and Hong Leong Finance for awhile and kind of just gave up any hope of them realizing the true value of these counters. The problem is that the Kweks have no need for money and don't see the need to sell off assets. I think passing down the businesses from generation to generation is more important to them and they are happy to just give out dividends year after year.

I still remember the time when there was speculation of Hong Leong Asia being divested and the price shot up to $5! Just imagine...at that time there was a lot of promise about Xinfei but i think Xinfei is clearly not as valuable now...

This is the reason why you need an asset stripper to come into the picture. Although xinfei is not as valuable now, their stakes in Tasek and China Yuchai has become much more attractive.

Yuchai is listed in the US and its underperformed rather badly all these years... surely it'd make more sense to invest directly in Yuchai if the stock is indeed undervalued.

Yuchai is undervalued. But it has always been overlooked by the market since there are some complaints that minority shareholders cant really exert influence on the management due to the golden share structure of CYI.

But this is a small issue because there are many companies in the US where the MI has little or no voting rights like Facebook and all the various tech companies.

So why not invest directly in Yuchai if its indeed undervalued? Why HLA? Any compelling reason?

(02-02-2015, 09:43 PM)lilvestor Wrote:

(02-02-2015, 08:33 PM)propertyinvestor Wrote:

(02-02-2015, 08:29 PM)lilvestor Wrote:

(02-02-2015, 09:58 AM)propertyinvestor Wrote:

(31-01-2015, 05:34 PM)sgpunter Wrote: I have been holding undervalued Kwek stocks like Hong Leong Asia and Hong Leong Finance for awhile and kind of just gave up any hope of them realizing the true value of these counters. The problem is that the Kweks have no need for money and don't see the need to sell off assets. I think passing down the businesses from generation to generation is more important to them and they are happy to just give out dividends year after year.

I still remember the time when there was speculation of Hong Leong Asia being divested and the price shot up to $5! Just imagine...at that time there was a lot of promise about Xinfei but i think Xinfei is clearly not as valuable now...

This is the reason why you need an asset stripper to come into the picture. Although xinfei is not as valuable now, their stakes in Tasek and China Yuchai has become much more attractive.

Yuchai is listed in the US and its underperformed rather badly all these years... surely it'd make more sense to invest directly in Yuchai if the stock is indeed undervalued.

Yuchai is undervalued. But it has always been overlooked by the market since there are some complaints that minority shareholders cant really exert influence on the management due to the golden share structure of CYI.

But this is a small issue because there are many companies in the US where the MI has little or no voting rights like Facebook and all the various tech companies.

So why not invest directly in Yuchai if its indeed undervalued? Why HLA? Any compelling reason?

Because HL asia controls a golden share in Yuchai. They have an advantage compard to other shareholders of Yuchai.

Other than that, its also a cheap way to invest for exposure to Tasek

not sure this is the reason yuchai is undervalue, but below a snippet from their 2014 annual report

We have in the past and may in the future experience disagreements and difficulties with the Chinese shareholders in Yuchai.
Although we own 76.4% of the outstanding shares of Yuchai, and believe we have proper legal ownership of our investment and a controlling financial
interest in Yuchai, in the event there is a dispute with Yuchai’s Chinese shareholders regarding our investment in Yuchai, we may have to rely on the Chinese
legal system for remedies. The Chinese legal system may not be as effective as compared to other more developed countries, such as the United States. See
“Item 3. Key Information — Risk Factors — Risks relating to China — The Chinese legal system embodies uncertainties which could limit the legal
protection available to foreign investors.” We have, in the past experienced problems from time to time in obtaining assistance and cooperation of Yuchai’s
Chinese shareholders in the daily management and operation of Yuchai. We have, in the past also experienced problems from time to time in obtaining the
assistance and cooperation of the State Holding Company in dealing with other various matters, including the implementation of corporate governance
procedures, the payment of dividends, the holding of Yuchai board meetings and the resolution of employee-related matters. Examples of these problems are
described elsewhere in this Annual Report. The July 2003 Agreement, the Reorganization Agreement and the Cooperation Agreement are intended to resolve
certain issues relating to our share ownership in Yuchai and the continued corporate governance and other difficulties which we have had with respect to
Yuchai. As part of the terms of the Reorganization Agreement, Yuchai agreed that it would seek the requisite shareholder approval prior to entering into any
material transactions (including any agreements or arrangements with parties related to Yuchai or any of its shareholders) and that it would comply with its
governance requirements. Yuchai also acknowledged and affirmed the Company’s continued rights as majority shareholder to direct the management and
policies of Yuchai through Yuchai’s Board of Directors. Yuchai’s Articles of Association have been amended and such amended Articles of Association as
approved by the Guangxi Department of Commerce on December 2, 2009, entitle the Company to elect nine of Yuchai’s 13 directors, thereby reaffirming the
Company’s right to effect all major decisions relating to Yuchai. While Yuchai has affirmed the Company’s continued rights as Yuchai’s majority
shareholder and authority to direct the management and policies of Yuchai, no assurance can be given that disagreements and difficulties with Yuchai’s
management and/or Yuchai’s Chinese shareholders will not recur, including implementation of the Reorganization Agreement and the Cooperation
Agreement, corporate governance matters or related party transactions. Such disagreements and difficulties could ultimately have a material adverse impact
on our consolidated financial position, results of operations and cash flows.

This problem was around since 2010 yet the price back then was $5. A successful turnaround for Xinfei is probably the key to unlocking value in this stock now. Sum of parts wise, this stock has a valuation range of between $2.20 - $3

(24-04-2015, 02:57 PM)testwrite Wrote: not sure this is the reason yuchai is undervalue, but below a snippet from their 2014 annual report

We have in the past and may in the future experience disagreements and difficulties with the Chinese shareholders in Yuchai.
Although we own 76.4% of the outstanding shares of Yuchai, and believe we have proper legal ownership of our investment and a controlling financial
interest in Yuchai, in the event there is a dispute with Yuchai’s Chinese shareholders regarding our investment in Yuchai, we may have to rely on the Chinese
legal system for remedies. The Chinese legal system may not be as effective as compared to other more developed countries, such as the United States. See
“Item 3. Key Information — Risk Factors — Risks relating to China — The Chinese legal system embodies uncertainties which could limit the legal
protection available to foreign investors.” We have, in the past experienced problems from time to time in obtaining assistance and cooperation of Yuchai’s
Chinese shareholders in the daily management and operation of Yuchai. We have, in the past also experienced problems from time to time in obtaining the
assistance and cooperation of the State Holding Company in dealing with other various matters, including the implementation of corporate governance
procedures, the payment of dividends, the holding of Yuchai board meetings and the resolution of employee-related matters. Examples of these problems are
described elsewhere in this Annual Report. The July 2003 Agreement, the Reorganization Agreement and the Cooperation Agreement are intended to resolve
certain issues relating to our share ownership in Yuchai and the continued corporate governance and other difficulties which we have had with respect to
Yuchai. As part of the terms of the Reorganization Agreement, Yuchai agreed that it would seek the requisite shareholder approval prior to entering into any
material transactions (including any agreements or arrangements with parties related to Yuchai or any of its shareholders) and that it would comply with its
governance requirements. Yuchai also acknowledged and affirmed the Company’s continued rights as majority shareholder to direct the management and
policies of Yuchai through Yuchai’s Board of Directors. Yuchai’s Articles of Association have been amended and such amended Articles of Association as
approved by the Guangxi Department of Commerce on December 2, 2009, entitle the Company to elect nine of Yuchai’s 13 directors, thereby reaffirming the
Company’s right to effect all major decisions relating to Yuchai. While Yuchai has affirmed the Company’s continued rights as Yuchai’s majority
shareholder and authority to direct the management and policies of Yuchai, no assurance can be given that disagreements and difficulties with Yuchai’s
management and/or Yuchai’s Chinese shareholders will not recur, including implementation of the Reorganization Agreement and the Cooperation
Agreement, corporate governance matters or related party transactions. Such disagreements and difficulties could ultimately have a material adverse impact
on our consolidated financial position, results of operations and cash flows.

This chronicly depressed value stock surged quite substantially these two days to 0.93. Company gave the usual response to SGX query.

http://repository.shareinvestor.com/rpt_...filename/1

Apparently just its 39% stake in ChinaYuchai, is already worth almost 120% of HLAsia entire MktCap based on its sub70c price two days ago.

at us$14, and us$1=S$1.43 forex
a 39% stake is worth some s$317.8m (40.7m shrs * us$14 * 1.43 * 39% = 317.77)

At curr 93c, HLAsia entire MktCap now rose to S$347M
at sub70c price over last two mths, HLAsia.s MktCap is only around S$260m

so rest of its biz are almost free....

 
found this story below

http://seekingalpha.com/insight/global-i...ke-slumber

Another example of Mr Market snoozing or depressive...