Casa Holdings

[valuebuddies]

There was a large dip in price during 2000-2002, tried to search around but found no clue, is the dip related to the dot.com crisis? The prices have been steadily moving upwards in the past 5 years in line with the property market boom, but I wonder if it can still going strong in the next 2 years.

Not yet vested

[thefarside]

1. How is the drop in price between 2000-2002 relevant to the current business?

2. Casa is primarily an electrical product distributor. They do have a Malaysian affiliate which has a property business on top of the electrical products business and dividends back some cash to them every year.

3. The recent property venture is a new business for the Singapore company.

4. Singapore business has benefited from the property projects but profitability has been so so over the years

[dydx]

FY13 (ended 30Sep13) AR now available for reading…..
http://infopub.sgx.com/FileOpen/Casa%20A...leID=20045
Circular to Shareholders (dated 8Jan14) with more details on Casa's proposed plan to take up a 34.3% minority equity interest in a project j-v company to undertake a residential/commercial property development project - to be developed in 4 phases over 7 to 9 years - on a piece of sea-front land [net area: 53,671 sq. meters; purchase price: MYR115.0m (approx. SGD44.85m), equivalent to MYR2,142 psm (approx. SGD835 psm, or SGD77 psf)] located at Teluk Jawa, Plentong Distrinct, Johor Bahru.
http://infopub.sgx.com/FileOpen/Casa-Cir...leID=20046

The land is located less than 1 km away from the rather successful Senibong Cove, a master-planned integrated residential, tourism and marina estate on the eastern coast of Johor Bahru being developed by Walker Corp, an established Aussie property developer…..
http://www.senibongcove.my
http://www.walkercorp.com.au

Phase 1 of the project - scheduled to be launched in 2Q-2014 - is expected to have a total development cost of MYR200.0m. Casa's share of the anticipated aggregate funding for the land purchase and Phase 1 development is only MYR12.69m (approx. SGD4.9m) - comprising MYR10.29m as their share of the initial capital injection into the j-v company (which is expected to raise some MYR85.0m from bank loans to part-fund the purchase of the land), and MYR2.4m as their share of the marketing/launch cost of Phase 1 (the construction of which is expected to be substantially financed by proceeds from pre-sales and bank loans). If properly executed, the proposed project looks promising especially from the angles of its very low land cost and sea-front advantage.

[dydx]

Based on a recent major land sale in Johore - wherein China-based developer Guangzhou R&F Properties Co Ltd (listed on HK Stock Exchange) has contracted to buy from Sultan Ibrahim Johor approx. 116 acres of land in Johor Bahru, comprising 4 plots of vacant freehold land and 2 plots of reclaimed freehold land, for a cool MYR4.5b!….
http://www.hkexnews.hk/listedco/listcone...202057.pdf [HKSE announcement]
http://www.thestar.com.my/Business/Busin...alty.aspx/ [The Star news report]
http://realestatesmalaysia.blogspot.sg/2...ecord.html [The Edge news report]

The reported unit land cost of MYR890 psf derived from the above transaction is actually substantially higher than the derived unit land cost of only MYR199 psf of Casa's proposed land purchase located at Teluk Jawa, Plentong Distrinct, Johor Bahru.

[Shrivathsa]

Interesting that Fiamma Berhad has shot up over the last year or so, while Casa has declined

[Shrivathsa]

http://www.bursamalaysia.com/market/list..._code=6939

a link to fiamma which shows the price rise

[Shrivathsa]

http://sgx-stocks-sti.blogspot.sg/2014/0...dings.html

I have written up my thoughts on this .

This post is about Casa Holdings.

Casa Holdings is not likely to be a short term trade or a medium term buy.

One will have to hold for at least ten years for this value to be realized.

From what is stated, Casa has a 28 odd % stake in Fiamma.

Fiamma is listed in Bursa Malaysia.

Fiamma shares have shot up by nearly 80% in the last one year.

Casa prices have stagnated at the same levels in Singapore.

The investment thesis is that at 25% of Fiamma, Casa is worth 18.6 cents Singapore Dollars.

This means that the rest of the business is free, if you are buying Casa at 19 cents.

The bear thesis is that

1) Everybody knows this and possibly, Casa cannot liquidate Fiamma stake.

2) On a stand-alone basis, Casa makes less than 0.5 cents / share as profit, so, it is valued at 3-4 cents for Singapore operations.

3) Hence, the value is actually 22 cents and a margin of safety of 15-20% is what you have when you buy at 19 cents.

Possibly, investors have examined this in the past, got in, waited, got no action and have decided to get out or are still waiting.

I believe that if one enters at around 19 cents and is prepared to hold for 15 years, one is likely to realize a five times return, which is a 11% compounded annual rate of return.

This is likely to be juiced by an extra 4% which would be the dividend yield.

A potential catalyst could be this property that they are developing that dydx mentioned above

[ValueMushroom]

Wonder how will the lost of Ariston distributorship affect Casa?

[ValueMushroom]

Any ideas what is the status of Casa Iskandar property launch? Has it been launched yet? What is the takeup rate?

[julianbream]

Has anyone read about the recent news that SGX will require listed companies with share prices less than $0.20 to do a 10-into-1 share consolidation, from 2016?

I am concerned about how this will affect Casa and similar companies. Quite certain that will lose money as I don't see the share price going up 10 times to compensate!

Does anyone here have any thoughts/ advice?

Vested.