Hyflux 6% perpetual callable 2020

[WolfT]

Interesting stuff.

BTWZ is now @ 0.71 - i have started buying some this mng.

Price has fallen from 0.89 from the start of this thread i.e. 20% fall in ~2mths.

I still think Hyflux is likely to not call N2H, but continue paying coupons.

flat yield for BTWZ for next 2yrs is 0.06/0.71=8.45%, stepping up to >10% (looking @ where 4y SOR is now). 

decent levels for a measured sized bet.

dyodd.

If you think Hyflux will not call back N2H, why do you buy now? Is it not better to buy BTWZ then because it(BTWZ) will drop a lot more when it happen.

[tanjm]

Interesting stuff.

BTWZ is now @ 0.71 - i have started buying some this mng.

Price has fallen from 0.89 from the start of this thread i.e. 20% fall in ~2mths.

I still think Hyflux is likely to not call N2H, but continue paying coupons.

flat yield for BTWZ for next 2yrs is 0.06/0.71=8.45%, stepping up to >10% (looking @ where 4y SOR is now). 

decent levels for a measured sized bet.

dyodd.

If you think Hyflux will not call back N2H, why do you buy now? Is it not better to buy BTWZ then because it(BTWZ) will drop a lot more when it happen.

The market has probably already taken this into consideration. I see no change in fundamentals from last time I looked. I bought some too.

[AQ.]

If you think Hyflux will not call back N2H, why do you buy now? Is it not better to buy BTWZ then because it(BTWZ) will drop a lot more when it happen.

1. I can be wrong!     It is not impossible that hyflux does call N2H. N2H will definitely rally, but i think BTWZ will also rally in this case (at least momentarily).

2. I had felt BTWZ was trading too high previously. The 2018-2019 OTC bonds were yielding ~10% on the mids (in general the yields seem to be rising constantly but the small size of the issues meant the spread were wide and thin). If 1-2y paper yields 10%, i thought i needed a larger MOS for the perps. @6-8%, a price of 0.7 gives 8.5-11%, which i deem fair.

The question is: If hyflux does not call N2H, but continues to pay, what kind of yield will the market require? I do not know, but current yields are juicy enough for me.

3. It is also not impossible for hyflux to not call, and not pay (i think it is rather unlikely and highly foolish to do. If Hyflux does decide to do so, it just might mean the end of Hyflux in one form or another eventually). The only way to protect myself is to limit my size bet.

[gzbkel]

Credit Initiation Report @bondsupermart
https://www.bondsupermart.com/main/share...Report.pdf

[CY09]

Hi Gzbkel,

Thanks for the report, it allows me to know the various bonds Hyflux has and how they are faring. I noticed both Hyflux bonds and Perps are now offering double digit yields. It is interesting that all 5 financial instruments experience a decline in prices in the same time period. Its preference shares and preps are at an all time low

<No longer vested>