Friday, February 1, 2019

Added: Sasseur Reit

Bought 90,000 shares of Sasseur REIT on 1 Feb at $0.64.

Similar to Keppel Corp (link) and First REIT (link), this is for short term too.

Reasons for buying:
1) Stock is oversold and at 52w low

Alot of bad reviews regard to Sasseur REIT when it launch its IPO at $0.80 (PB 1.03x) in Mar 2018. I will not purchase it too during IPO due to many unknowns and uncertainly if Sasseur REIT is able to deliver on the performance. Given it is priced at PB 1.03x, there is no safety of margin and worst, the price is 0.03x premium.

BUT things are diff now given the price had dropped to $0.64 (PB 0.83x). 

2) Performance Beat Forecast
Sasseur REIT had released 2 quarters of their results. 

3) Close to 10% dividend (Estimated)
Sasseur had declared 3Q DPU of 1.542cents/share. 
As they paid dividend semi-yearly, the 4Q result will be release on 18th Feb.
By purchasing now and hold it till xD, we will be getting both 3Q & 4Q dividends.

[(2Q DPU of 1.587 + 3Q DPU of 1.542) / 0.64] x 2 = 10%

Sasseur is distributing 100% till 31 Dec 2019, and at least 90% distribution from 1 Jan 2020.

4) Insider trades
There are alot of insider trades for Sasseur Reit (Link). 
The latest is on 18th Jan where Mr Anthony Ang, CEO of Sasseur Reit, bought 100,000 shares at $0.69.

5) 2 years of income support (Till end of 2019) from Sponsor
6) Sponsor hold at least 50% while Cornerstone investors hold around 20% of Sasseur Reit shares
7) 4Q is the best quarter (Hopefully)
At the 3Q18 results briefing, someone asked: "Historically, how does your business perform season by season?"

The REIT manager's CEO, Anthony Ang, replied: "Generally speaking, sales for the first quarter account for about 25% of the year's. Second quarter is 20%, third quarter 25%, and the four quarter, 30%. In other words, you will have the best quarter coming up, hopefully."  

8) Chongqing Outlets contribute around 71% to portfolio income
Since Chongqing outlets contribute around 71% to portfolio income, it is good to read news such as this.

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