Global Investments

[wahkao]

perhaps this chart will be helpful for your analysis
Not technical analysis price chart I promise
[Image: oupXgF1.png]


I feel that buying this stock is equivalent to buying a fund ETF.
Being rather good in both TA and FA, I rather directly cherry pick the stocks I like than going after an ETF.

The only good thing here is a p/nav discount. at p/nav of 0.6 it looks really yummy.

[sykn]

Wow, especially for some of you who are not even vested, you've provided so much in depth analysis - I'm still trying to digest what some of you have written (me, dumb newbie lah!). But I agree with D123's conclusion that you either stay out or go all the way to take up all rights and script issues. The last time they gave out rights, I decided not to take up but just collect my divi's and run; then the price went down because of dilution and I felt really stupid. But more seriously, I know BSF (major share holder) personally and he's a pretty smart cookie. My simple theory (Buffet's way) is that if they continue to rack up high retained earnings without resorting to rights issue (which they did not do until this last round) or making any big mistakes playing with derivatives, sooner or later, this must pull the (currently miserable) stock price upwards. It remains to be seen if this will happen.

[wahkao]

Wow, especially for some of you who are not even vested, you've provided so much in depth analysis - I'm still trying to digest what some of you have written (me, dumb newbie lah!). But I agree with D123's conclusion that you either stay out or go all the way to take up all rights and script issues. The last time they gave out rights, I decided not to take up but just collect my divi's and run; then the price went down because of dilution and I felt really stupid. But more seriously, I know BSF (major share holder) personally and he's a pretty smart cookie. My simple theory (Buffet's way) is that if they continue to rack up high retained earnings without resorting to rights issue (which they did not do until this last round) or making any big mistakes playing with derivatives, sooner or later, this must pull the (currently miserable) stock price upwards. It remains to be seen if this will happen.

dont be fooled by the increasing retailed earnings
its just an illusion created to make you think they are making a lot of money

[sgd]

Ok lets do simple calculation and review fy 2013 we don't include items that look like they can be used to boost earnings.

A -We take these
dividend income 2368
interest income 13543
rental income 1577
net gain sale inv 14065

B -We don't take these
don't incl fair value on inv 472
don't incl other income 3847
don't incl share profit of assoc 5224

new gross A is 31553

We deduct expenses and taxes
expenses 11824
taxes 498 <- (this should be much lower)

new profit = 19231

new margin = 19231/31553 = 60%

60% profit a year using very little debt, not many listed companies on sgx can earn 60% margin using very little debt.

[Nick]

Ok lets do simple calculation and review fy 2013 we don't include items that look like they can be used to boost earnings.

A -We take these
dividend income 2368
interest income 13543
rental income 1577
net gain sale inv 14065

B -We don't take these
don't incl fair value on inv 472
don't incl other income 3847
don't incl share profit of assoc 5224

new gross A is 31553

We deduct expenses and taxes
expenses 11824
taxes 498 <- (this should be much lower)

new profit = 19231

new margin = 19231/31553 = 60%

60% profit a year using very little debt, not many listed companies on sgx can earn 60% margin using very little debt.

This is an investment company unlike many other companies listed in SGX which are operating companies. Its revenue consist of interest income and dividend income. There is no cost involved for such 'revenue stream' hence the high margin. Think about it - you and I are enjoying our dividend income at 100% margin ! Instead, I would think ROE would be a better comparison.

[Boon]

My ROUGH estimation:

(SGD)
Total number of shares issued = 1, 192 million
DPS = SGD 0.015
FCF required to pay dividend = 17.88 million
Operating Cost (Cash items only, excluding non-cash expenses) = 4.643 million, (assumed same as in FY2013).
FCF required, inclusive of operating costs = 22. 52 million
,
Total Asset = around 270 million

Portfolio as at 31-12-2013:
Oerating Lease Asset = 3% (Carrying Value = 8.1 million ; assumed projected return = 1.5 million, same as FY2012}
Listed Equity = 36% (Carrying Value = 95.8 million, assumed projected return = X %)
Loan Portfolio and Securitization Assets = 35% (Carrying Value = 94.5 million, assumed projected return of Y %)
Bonds = 22% (Carrying Value = 59.76 million; approximated average coupon = 6.82%,given, >> return = 4.07 million, assumed no realized capital gains)
Cash = 4% (10.8 million) {assumed zero return}

Total projected OCF = 1.5 + 95.8 (X) + 94.5 (Y) + 4.07 + 0 = 22.52

On average X and Y must achieve 8.8% return which is not impossible.

(not vested)

[Boon]

AR2013 is out.

http://www.globalinvestmentslimited.com/...AR2013.pdf

(not vested)

[sykn]

My ROUGH estimation:

(SGD)
Total number of shares issued = 1, 192 million
DPS = SGD 0.015
FCF required to pay dividend = 17.88 million
Operating Cost (Cash items only, excluding non-cash expenses) = 4.643 million, (assumed same as in FY2013).
FCF required, inclusive of operating costs = 22. 52 million
,
Total Asset = around 270 million

Portfolio as at 31-12-2013:
Oerating Lease Asset = 3% (Carrying Value = 8.1 million ; assumed projected return = 1.5 million, same as FY2012}
Listed Equity = 36% (Carrying Value = 95.8 million, assumed projected return = X %)
Loan Portfolio and Securitization Assets = 35% (Carrying Value = 94.5 million, assumed projected return of Y %)
Bonds = 22% (Carrying Value = 59.76 million; approximated average coupon = 6.82%,given, >> return = 4.07 million, assumed no realized capital gains)
Cash = 4% (10.8 million) {assumed zero return}

Total projected OCF = 1.5 + 95.8 (X) + 94.5 (Y) + 4.07 + 0 = 22.52

On average X and Y must achieve 8.8% return which is not impossible.

(not vested)

Appreciate the calculations. I read the AR13 with some interest - typical hard sell with lots of glossy pictures and numbers set to impress - learned from his STE days when he had to satisfy MINDEF. I still don't have very good vibes; will probably hold until I find something better and flip over to another counter because some of its exotic businesses are not easy to understand and even harder to predict. Many thanks.

[Boon]

GIL has released it 1Q2014 results, here are my thoughts:

1) It has provided 1H2014 dividend guidance of SGD 0.75 cent per share to be paid in October – looks like it is going back to paying dividend on semi-annually basis
2) FCF required for DPS of SGD 1.5 cents = SGD 17.88 million per annum
3) FCF generated in 1Q = Net OCF(recurring CF) + Net gain on sale of investments = 1.058 + 1.884 = SGD 2.942 million
4) As at 31March2014, the cumulative unrealized fair value gain of its Listed Equity portfolio was SGD 8.06 million.
5) With no more assets inherited from the previous management left that could be sold for substantial gains, can the current management of GIL manage to generate enough FCF to support a DPS of SGD 1.5 cent per annum? It is still too early to tell.

(not vested)

[mrEngineer]

Interesting fund and strong back support. Just jumped onto wagon due to its exposure to European investment.