Boustead Singapore

https://www.theedgesingapore.com/capital...24-results

So so so undervalued.... SOTP valuation easily more than $3 by now....

99.5% of BP (RNAV of BP is more than $2) => Boustead's share is $1.3...
Net cash of Boustead = ~$0.5
Geo-spatial = 12 times PE x PBT (~$40m) = ~$1
Engineering = 8 times PE x PBT (~$30m) = ~$0.50
Health care = $0

(basis is at page 31).

Boustead SGXNet Announcement-FY2024-27.05.2024.ashx

Total SOTP Valuation = >$3

Hi Curiousparty,

What you have shared above couldn't be deemed as total RNAV of Boustead Singapore. This is because you are using PE valuations for Geo-spatial and Engineering business segments and then added up with RNAV valuation of BP to compute it.

If you want to compute the total RNAV of Boustead Singapore, you have to be consistent. Meaning, you have to use RNAV valuation of all their business segments and then add them all up together.

I would be more acceptable if you had stated the above computation of yours is SOTP (Sum of the Parts) valuation of Boustead Singapore.

BS@104

Received annual report for BP and thought some valuebuddies might be keen:

2024 vs 2023
Rev $369m $283m
GP $45m $25m
NP $22m $18m
Cash $215m $177m

Gratitude!

(13-07-2024, 12:21 PM)¯|_(ツ)_/¯ Wrote: BS@104

Received annual report for BP and thought some valuebuddies might be keen:

2024 vs 2023
Rev $369m $283m
GP $45m $25m
NP $22m $18m
Cash $215m $177m

Gratitude!

Hi, 

Thanks for sharing. Any dividend declared?

Tks

Taking over this freehold land when the debtor defaulted, was a great move. But the big payday will be some time away, and from Chairman FF Wong's previous track record, OPMIs can look forward to a probable payday. As usual, do OPMIs have the temperament to do so?

BOUSTEAD FY2024 ANNUAL GENERAL MEETING ADVANCE QUESTIONS AND RESPONSES

In his message to shareholders, the Chairman indicated that the newly opened COMO Orchard at 28 & 30 Bideford Road will continue to be lossmaking in the near term due to high depreciation and interest costs. The Group’s share of results from Bideford House Pte Ltd in FY2024 was S$(10.0) million (FY2023: S$(1.3) million). Can management provide the occupancy rates at COMO Metropolitan Singapore? Was the investment thesis for 28 & 30 Bideford Road based on an assumption of low interest rates? Is the high depreciation of COMO Orchard typical for the hotel business and has management been taken by surprise by these depreciation and interest costs? What is the expected timeline for COMO Orchard to achieve breakeven and profitability?

COMO Orchard is a mixed-use asset – consisting of five commercial and retail floors for lease, and with the remaining floors under COMO Metropolitan Singapore, a hotel under a management contract with COMO. The commercial and retail floors are fully leased out. The hotel has been in operation since September 2023 and requires a longer period (i.e. a series of peak and low seasons) to ascertain average occupancy.

The investment in COMO Orchard was not based on low interest rate expectations and did assume larger losses in the initial years but with a medium-term plan to profitability. The high depreciation costs are unrelated to the property’s function as a hotel but are due solely to the cost of the development which is capitalised and the nature of the land which is freehold.

Due to accounting policy, management always expected this depreciation because it applies to all assets. Do note that this is a non-cash item and the gap to achieve cashflow breakeven and profitability is not as large as the accounting figures show. The Real Estate Solutions Division’s management is working closely with the hotel operator and tenants to improve the marketing efforts including awareness and outreach, and achieving stabilisation of the asset. This includes collaborations with DA MedSuites, COMO Shambhala, Cedric Grolet and other COMO Hotels and Resorts.

https://links.sgx.com/FileOpen/Boustead%...eID=812341

BSL's AGM ppt is pretty heavy with slides and valuable information, I must say. There are 2 things that I notice FF Wong to be slightly different compared to the general behavior of other listed SGX companies' towkays:

First, FF Wong tells everyone the bad news, almost unreservedly.

2nd, FF Wong puts the staff acknowledgments almost right at the top, and there were plenty of them. I remember when the energy division was doing well a couple of years ago, the Division Head was paid MORE than FF Wong or his son. Essentially, FF Wong gets most of his tangible remuneration through dividends, aligning his interest with OPMI.

Boustead Singapore Limited FY2024 Annual General Meeting

AGM meeting min ppt:
https://links.sgx.com/FileOpen/Boustead%...eID=813120

P.S I am not vested in BSL but personally, I will never get on board with someone who pays themselves (and more often than not, including their clan) more in salaries than the portion they get from dividends.

I think he is a rare type.

Which then begs the question, what happens when he steps down?

(28-07-2024, 12:07 PM)EnSabahNur Wrote: I think he is a rare type.

Which then begs the question, what happens when he steps down?

His otherwise unblemished record took a knock during the privatisation of Boustead Project. Would history repeat should there be a privatisation of Boustead Singapore?

(28-07-2024, 11:46 PM)Shiyi Wrote:

(28-07-2024, 12:07 PM)EnSabahNur Wrote: I think he is a rare type.

Which then begs the question, what happens when he steps down?

His otherwise unblemished record took a knock during the privatisation of Boustead Project. Would history repeat should there be a privatisation of Boustead Singapore?

I thought he has explained he has to consider Boustead Spore interest and not bid too high for Boustead Prj?

(13-08-2024, 08:54 PM)Curiousparty Wrote: In today’s fast-paced and increasingly regulated financial environment, the decision for a company to remain publicly listed is not as straightforward as it once was. Boustead Parent Company, with its robust financial position and significant net cash reserves, presents a compelling case for privatization—a move that could serve the best interests of all stakeholders.

The Financial Argument: A Generous Payday

At a buyout price of $1.20 or higher, privatizing Boustead would offer a lucrative payday for shareholders. Given the company’s substantial net cash reserves, this valuation could provide an attractive premium, making it a win-win for current investors. They would receive immediate returns on their investments, free from the uncertainties and volatilities that can come with being a publicly traded entity.

The Burden of Being Public: Reporting and Scrutiny

Remaining publicly listed subjects Boustead to a host of stringent reporting requirements and continuous scrutiny from the investment community. This often results in significant administrative overhead and forces the company to operate under the relentless pressure of quarterly earnings expectations. For a company with strong cash flow and no pressing need for external capital, these obligations can become more of a burden than a benefit.

Why Privatization Makes Sense Now

With its strong balance sheet and ample liquidity, Boustead is well-positioned to transition to a private ownership structure. By doing so, the company could focus on long-term strategic goals without the distractions and constraints imposed by the public markets. The leadership could streamline operations, make more agile decisions, and reinvest in the business with a clear, unencumbered vision.

Conclusion: A Strategic Move for the Future

Privatizing Boustead at $1.20 or beyond would not only deliver immediate value to shareholders but also free the company from the shackles of public market obligations. This strategic move would allow Boustead to leverage its financial strength in a more focused and efficient manner, ultimately benefiting the company and its stakeholders in the long run.

In an era where the advantages of being publicly listed are increasingly questioned, Boustead’s potential privatization stands out as a smart, forward-looking strategy.

hi curiousparty,

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