Health check on property companies (M'sia)

3 key indicators to check the health of a property companies.

1. Gross Development Value GDV:-
Often, you would find these information in the Chairman’s and CEO’s Statements and the Operating Review within a company’s annual reports.


2. Landbanking:-
Size of land bank and remaining GDV
Landbanking is often referred to a property company’s purchase to increase their land holdings. There is no real tangible asset for property stocks

3. Unbilled Sales:-
Unbilled sales are revenues which have yet to be reported in a company’s financial statements. These could be property sales achieved by their current projects. Often, they would be reported in the next 1 - 2 financial year

Health check on tech/semicon companies (M'sia)

3 key indicators to check the health of technology or semiconductors companies.

1. Inventory level:-
Inventory ÷ revenue
High inventory level may cause inventory write down, as tech demand changes rapidly


2. Investment expenditure:-
Capex ÷ revenue
Compare it with the previous quarters, if it grows higher then be careful on the profits for upcoming quarters

3. Net profit margin:-
Upstream players eg. Vitrox is doing an automated testing machine and semiconductors biz is maintaining a 20% to 30% profit margin all the time. However, downstream players eg. SKP Resources is doing assembly biz, which only maintaining a 5% to 10% profit margin.

Health check on REITs (M'sia)

Top 3 REITs in Malaysia are mainly from retail segments, they are respectively IGB REIT, Sunway REIT and Pav REIT.


4 indicators to show the strength of a REIT:-
1. Rental income per square feet.
2. Occupancy rate
3. Income distribution
4. Net Property Income Margin

Extra 6 filters to pick a great REIT:- (inspired by Starman)

1. DPU growth

2. Quality of real estate

3. Genuine valuation of the NAV (not makeup by valuator)

4. Diversification of estate holding (prevent concentration risk)

5. Makeup in the balance sheet (a) major shareholder guarantee, (b) major shareholder not taking dividend for first few years and hence DY was artificially drove up upon listing, (c) interest rate swap, hence the interest rate is lower at first, then higher at the end of tenure

6. Capability for asset enhancement (most important!)


IGB REIT
Highlights: Mid Valley Megamall, The Garden Mall
Location: Klang Valley
Key segments: Retailer
Rental per sqft: rm15
Occupancy rate: 100% for 3 years
Income distribution: 78% retailer, 9% parking, 13% ads
Net Property Income Margin: 77%

Sunway REIT
Highlights: Sunway Pymarid Mall, Sunway Medical Centre, Sunway Hotel
Location: Penang, Perak, KL
Key segments: Retailer, Hotel, Hospital, Office
Rental per sqft: rm11
Occupancy rate: 95% retail, 70% others
Income distribution: 75% retailer, 13% hotel, 7% office, 4% hospital
Net Property Income Margin: 71%

Pavilion REIT
Highlights: Pavilion Shopping Mall, Intermark Mall, Da Men Mall, Pavilion Tower
Location: Klang Valley
Key segments: Retailer, Office
Rental per sqft: rm20
Occupancy rate: 98%
Income distribution: Retailer
Net Property Income Margin: 66%

在哪里等榴莲？

投资里看到的数字通常都没有绝对高点或者绝对低点 (absolute)，大多数的数字都是相对的 (relative)，包括市场估值。

现在的高点可能是以后的低点，所以你要好好比较他们，才有参考价值。现在有很多人喊🐻来了，那么我们要知道🐻大哥是明天来，下个月来，还是现在坐在你我隔壁。所以我们要好好参考以前的🐻来了，市场估值到底在哪里。

拿出两个ratio看一看，PE和PB。虽然KLCI的成份股里有6个是银行股，可是却占了大约27%，所以我认为用PB来衡量会比较妥当。（因为银行股是属于重资产公司，而他们的资产负债表里的asset都比较liquid）

今天看到了uobkayhian的报告里面提到了过往几个危机里KLCI的估值，从这里看得出Mr. Market这次给出的估值比上几次的危机还要低（目前只是高于AFC），证明了covid19的严重性不是玩玩的。

油价你要加油

自从原油市场闪崩了之后，我做了一些功课关于现在的油价到底能不能够支撑O&G公司甚至一些国家，以下是一些小发现。

相信大家都知道中东国家出产的普遍上都是brent oil，而北美洲出产普遍上都是WTI crude oil。根据Rystad Energy指出，自从2014年以来，北美洲的WTI crude oil成本价越来越低。截至2019年为止，WTI crude oil的weighted average breakeven price从64USD/bbl降到了46USD/bbl，非常惊人。

再看一看中东国家onshore的breakeven price维持在42USD/bbl，和Russia的59USD/bbl

这样看起来以现在的油价，俄罗斯要倒贴很够力一下（虽然沙地也是在亏钱）。所以我大胆猜测，这个价钱不会持续长时间，因为长期来说这是一个lose-lose situation。为了求证，看了之前2008次贷危机的时候brent oil用了差不多4个月的时间重新站回50USD/bbl。2015年油价崩跌的时间，brent oil呆在40USD/bbl一下的时间也不超过4个月的时间。

所以这段时间，我们可以慢慢筛选基本面强劲的O&G公司，等到心仪的价钱时分批买进，相信亏钱的机会也不会很大。