SMRT

[Stockerman]

How can we buy the shares of SMRT when the CEO didnt even know how to take MRT to work?

I heard from sources that he did not even know how to use the MRT card....

Price attractive enough to buy?

Dont think it is a good idea to touch smrt, rates increase are never easy due to the political nature...

[pianist]

I seem to recall that they were making tonnes of money last decade that PTC agreed to relook at the fare adjustment formula?

I recall the most classic one was Marlboro Tan saying buses are expenses which commuters had to pay for the renewals. I didn't know buses were not revenue generating assets. Was wondering if I can get IRAS deduction for my car expense also.

eventually tax-payers have to pay for public goods such as buses and trains.
just saw the news that govt is buying and adding 15 more trains to the downtown line, where did the money come from - tax payer monies..

so in a sense, smrt and sbs in the past fork out own pocket monies to buy buses, they are already doing a national service. bus purchase should be fully borne by the govt.

[specuvestor]

^^ firstly they were making tons of money AFTER taking into account depreciation

Secondly if tax payers have to pay then these public service entities should not be listed in the first place to focus for shareholders, rather than tax payers. It is not difficult to understand why they skimp on maintenance. You cannot serve 2 masters.

The government is taking over the operating assets as they realised they need to make sure maintenance is being done effectively, not just efficiently by capitalists, when transport is virtually a monopoly, and ironically transport has huge impact on economic efficiency. An excellent case study on how serving self interest will not on aggregate serve the common good.

Again, another case of not sharing the upside with the masses but socialise the cost on the downside. There is a very deep rooted dogma of evolutionist capitalism that people tolerate these kind of illogical social arrangement.

[HitandRun]

By its action, the government is admitting that the competition model that it was trying to develop is broken. How long will the government take before it concedes defeat and buys back SMRT and Comfort Delgro?

[Temperament]

^^ firstly they were making tons of money AFTER taking into account depreciation

Secondly if tax payers have to pay then these public service entities should not be listed in the first place to focus for shareholders, rather than tax payers. It is not difficult to understand why they skimp on maintenance. You cannot serve 2 masters.

The government is taking over the operating assets as they realised they need to make sure maintenance is being done effectively, not just efficiently by capitalists, when transport is virtually a monopoly, and ironically transport has huge impact on economic efficiency. An excellent case study on how serving self interest will not on aggregate serve the common good.

Again, another case of not sharing the upside with the masses but socialise the cost on the downside. There is a very deep rooted dogma of evolutionist capitalism that people tolerate these kind of illogical social arrangement.

As usual, you put it so well, so high IQ. Hey! Don't worry. Kopitiam way of saying is:- "All businesses that make money, Papies take; all businesses that lost money, the people has to take a share." If not the "blame".
Ha! Ha! Tiok Boh?

[CityFarmer]

^^ firstly they were making tons of money AFTER taking into account depreciation

Well, if ROA of 10% means tons of money, then lots of other companies are also making more than tons of money

PPM of SMRT are operating asset, means its value drop with age. Depreciation is a real expense and should be accounted.

[pubster]

Dear all,

I'm writing here, hoping to seek some suggestions from the value investors here.

I had invested using my CPF, 15 lots of SMRT@$1.89 some 2 years back. At that time, I was thinking that SMRT with its ever expanding retail, monopoly of the train system with increasing ridership every year, and also increasing dividend every few years, it will give me better returns than the 2.5% CPF is giving me which do not even cover inflation.

But things never goes the way we intended. SMRT was taken out of the STI index, then engineering problems starts to surface one after another.

Currently my SMRT investment is underwater. Do I,
1) Cut losses and reinvest in better stocks(SPH? STE?)
2) Hold and hope for it to resurface while collecting dividends
3) Average down another 10 lots(my CPF still have around 16k for stocks investment) when the dust settle after the profit guidance knee jerk reaction

Of course I understand that investing comes with risk as compared to the guaranteed 2.5%. Hence I'm not complaining. Now I'm just trying to seek a solution to better the current situation.

All your suggestions are greatly appreciated. Thank you in advance.

[Temperament]

Successful Investors – Risk Limit
(Proper Asset Allocation Can See Your Portfolio Survive All Types of Market)
All successful investors know their personal risk limit, though they may describe them differently.
1) Warren Buffet invests within his circle of competence.
2) Benjamin Graham only bought stocks that had a high margin of safety.
3) John Templeton does not invest in a country until there is “blood in the street”. (Market Crashed).
These people thought long and hard about controlling risk. As Warren Buffet reminds us, “Risk comes from not knowing what you are doing”.

Extract:-
Investing is a discipline:
Witness the stock market panic of late 2008 or any long-in-the-tooth bear market. Suddenly, otherwise rational people become short term focused and panic-sell along with the masses. A disciplined investor knows to stay put or even buy in such times. We all know it and have heard that advice over and over—yet somehow, few are able to heed it. Why? The lack of discipline or self-control is why.
The way to save you from yourself is self-awareness. There is no antidote for irrationality. We are all emotional and subjective. Our best hope is to recognize it and gain some chance of surmounting our natural tendency to foil ourselves.
From me:-
And investment in the stock market should be your lifelong learning goal. No matter at what age you started. So be very, very patient to read & read & learn. And only you can do it your own way because only you know yourself best. Nobody can know what you think better than what you really think.
My 2 cents.
Shalom.
Amen.

[brattzz]

I also own SMRT shares using CPF.

My take is this, with the rail network km set to double, treble in 2030, it does not make sense to sell SMRT shares NOW due to the past 1-2 yrs of bad management and populist government policies on public transport system. SMRT management did indeed SCREWED UP! but that does not change the fundamental economics of the singapore rail transport biz. It is a BREAD n BUTTER SUPER-essential service.

In fact, the lower the price go, the more keen i am to buy more! i am just waiting for a bottoming out...

Let's see how much is the dividend yield after the cut, which will definately send the share price down further! which means more buying opportunities for me!

BUT, if u cannot take the emotional pain of see the falling share price daily, one trick you can do now is to cut ur loss, and sell 50% or 100%, and HOPE that you can buy back at a lower price later...

there are many roads to rome, it's your choice!

short term - long term, as long as it makes $, i am happy!

[Temperament]

Yes! i have sold mine to take some profit even before the "BIG MOUTH" appeared. At the same time, i believe in the long run i should still buy SMRT for dividend income. The problem is when and at what price and div. yield.

Note:- This counter seems to be "market crashed proof" dividend player kind of stock. During 2008/2009 market crash, i watched it quite closely but i did not buy as i were not convince of its price then. (aka yield and so many unsolved problems.) Another words, i was surprised its price hold so well.
Have the problems been lessened and yield recovery soon?. i don't think so.