Portfolio Summary for May 2023

As of 31 May 2023

CDP

Security	# shares	Price S$	%
DBS	400	31.33	3.33
UOB	400	28.06	2.98
OCBC Bank	700	12.22	2.27
SGX	2,700	9.25	6.64
iFast	5,700	4.51	6.83
ST Engineering	6,900	3.73	6.84
CapitaLand Investment	7,400	3.40	6.68
SATS	8,200	2.63	5.73
Powermatic Data	8,500	2.66	6.01
TheHourGlass	5,000	1.99	2.64
Micro-Mechanics	14,200	1.84	6.94
VICOM	14,000	1.78	6.62
Sheng Siong	13,000	1.62	5.60
Nanofilm	15,400	1.49	6.10
Genting Singapore	11,700	1.02	3.17
Credit Bureau Asia	14,300	0.95	3.63
HRnetGroup	21,900	0.75	4.39
TalkMed Group	14,500	0.43	1.66
China Sunsine	41,800	0.41	4.61
HC Surgical	35,500	0.40	3.73
Kimly	27,000	0.34	2.44
Silverlake Axis	15,000	0.29	1.18

Portfolio Market Value = $376,403
YTD Dividends Received = $6,490
YTD SBL Fees Received = $694

Trades
- Bought 100 shares of DBS.
- Bought 100 shares of UOB.
- Bought 2,200 shares of VICOM.
- Bought 3,100 shares of Micro-Mechanics.
- Sold 11,200 shares of ComfortDelGro.

SRS

Security	# shares	Price S$	%
DBS	100	31.33	2.14
UOB	200	28.06	3.84
OCBC Bank	900	12.22	7.52
SGX	1,300	9.25	8.23
iFast	2,100	4.51	6.48
ST Engineering	3,000	3.73	7.65
CapitaLand Investment	2,600	3.40	6.05
SATS	3,800	2.63	6.84
Powermatic Data	3,400	2.66	6.19
Micro-Mechanics	5,400	1.84	6.80
VICOM	5,500	1.78	6.70
Sheng Siong	8,700	1.62	9.64
Nanofilm	5,500	1.49	5.61
Credit Bureau Asia	5,700	0.95	3.72
TalkMed Group	5,800	0.43	1.71
China Sunsine	10,800	0.41	3.07
HC Surgical	19,500	0.40	5.27
Kimly	5,800	0.34	1.35
Silverlake Axis	6,000	0.29	1.21

Portfolio Market Value = $146,186

Trades
- Bought 100 shares of DBS.
- Bought 200 shares of UOB.
- Bought 800 shares of VICOM.
- Bought 2,300 shares of Micro-Mechanics.
- Sold 6,900 shares of ComfortDelGro.

Singapore Savings Bonds

Security	Amount ($)	Avg Yld %
GX18070N	12,500	2.63
GX22120S	14,000	3.47
GX23010Z	15,000	3.26

Portfolio Market Value = $41,500

Commentary:

There is an old adage to "sell in May and go away, come back on St. Leger's Day." (St. Leger's Day refers to a horse racing festival in Britian, happening on 14 to 17 September this year.) It was meant for investors to avoid the stock market's seasonally weaker performance between May and October.

Contrary to this advice, I bought more shares than sold this month. As prices retreated, I added DBS, UOB, VICOM and Micro-Mechanics. I must admit - I'm not smart enough to buy at the bottom. I just thought that at current levels, I can start nibbling bit by bit. We will never know how far (down) the prices can go, so I set aside some capital to buy the shares at pre-set levels. If the market turns up, great because the value of my position increases; if the market continues to tank, no problem too. I get the chance to buy at better prices.

DBS reported another set of record-breaking result [here]. 1Q23 total income was S$4.67b, up 44% YoY. Net profit was S$2.57b, up 43% YoY. ROE improved to 18.6%, up 5.5% YoY. NIM gained 8 bps QoQ to 2.69% while NPL remained stable at 1.1%. 42 cents DPS was declared. CEO Piyush Gupta wrote that the NIM has likely peaked in 1Q, and guided full year NIM to be around 2.05-2.10%. In its latest Investor Day presentation [here], DBS CFO Chng Sok Hui made a bold prediction that DBS will achieve "earnings of $10b+ and ROE of 15%-17% in the medium term, assuming interest rates do not return to unusually low levels".

OCBC reported a good set of results too [here]. 1Q23 total income was S$3.35b, up 27% YoY. Net profit was S$1.88b, up 39% YoY. ROE improved to 14.7%, up 4.1% YoY. NIM dropped 1 bp QoQ to 2.30% while NPL improved 0.1 QoQ to 1.1%. No dividend was declared. CEO Helen Wong guided 2023 NIM to be in the region of 2.2% and loan growth around low to mid single-digit. She also assured that OCBC's robust capital position can support the targeted 50% dividend payout. In a Business Times interview [here], the CEO is confident that OCBC is in a good position to capture wealth and trade flows given its strong links between Greater China and the ASEAN region.

Despite the stellar results, the local bank stocks took a beating in May. The Street consensus is that NIM has peaked and NPL may increase as the economy enters a recession. Some asset managers are even expecting a rate cut by the U.S. Fed in the second half of 2023, which in my opinion, seems to be a premature call at this point in time. This stands in stark contrast with St. Louis Fed President James Bullard's comment [here] that he expects two more rate hikes in 2023 to quell inflation.

And then there is the U.S. debt ceiling drama during mid-month between the Republicans and Democrats. No one truly believes the United States should default on its debt obligations, just that each party tries to leverage on the situation to advance their own agenda. The tussle generated volatility in the market, which is good for opportunistic buying.

May is a good month where I received cash dividends from several companies. Total amount received year-to-date in my CDP portfolio is $6,490.29. Not a lot of money, but it is one step closer to my goal of generating cashflow from investing in fundamentally strong companies.

I signed up for SGX Securities Borrowing and Lending (SBL) Pool some years ago [here]. I can see some of my shares being lent out to other investors. I earn interest (plus owed dividends) after the short sellers return the shares. If you meet the mininum requirements, I recommend to sign up for this programme to earn side income.

I sold my shares of ComfortDelGro (CDG). The rationale was covered in my April blog post [here]. I want to consolidate my capital and make more concentrated bets. CDG share hasn't performed well post-pandemic. With this sale, I'm officially divested of this public transport operator. By the way, CDG recently announced their 1Q23 result [here]. Revenue climbed 2.1% YoY to $906.4m, but Operating Profit dropped 51.6% YoY to $50.9m. The decline was attributed to inflationary cost pressures on Public Transport Services.

I have two AIA saving policies maturing in May and June respectively this year. I signed up for them when I was in N.S. The annual premium was a small sum that I faithfully paid, even when I was hard on cash. I am glad for being disciplined on this commitment throughout my university days and working life. The principal and compounded coupons are a welcome boost to my dry powder for stock investments. (Truth be told, I had forgotten why I took the policies in the first place!)

I had received some units of CapitaLand Ascott Trust from the last dividend corp action of CapitaLand Investment. Quite a hassle to sell odd lots. Will try to offload them at the right time.

Money matters aside, I visited a few secondary schools' Open House this month. I thought it might be good to check out what those schools have to offer. I'm intrigued by the Integrated Programme (IP) [link] as well as the Direct School Admission for Secondary Schools [link]. I hope my boys will be able to qualify for these programmes.

Until next time, take care!

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Portfolio Summary for January 2022

As of 31 January 2022

CDP

Security	# shares	Price S$	%
DBS	700	35.20	8.20
OCBC Bank	1,500	12.47	6.22
SGX	1,200	9.31	3.72
SATS	3,900	3.91	5.07
ST Engineering	6,800	3.73	8.44
CapitaLand Invest	5,400	3.45	6.20
Singtel	6,100	2.43	4.93
Powermatic Data	5,000	2.86	4.76
Micro-Mechanics	1,300	3.31	1.43
ComfortDelGro	11,200	1.36	5.07
Sheng Siong	13,000	1.49	6.44
TheHourGlass	15,400	1.89	9.68
Genting Singapore	11,700	0.735	2.86
HRnetGroup	21,900	0.76	5.54
China Sunsine	31,000	0.465	4.80
HC Surgical	35,500	0.51	6.02
Silverlake Axis	60,800	0.235	4.75
Kimly	27,000	0.41	3.68
CL Int Com Trust	3,400	1.94	2.19

Portfolio Market Value = $300,612

Trade Actions
- Bought 2,700 shares of ST Engineering.
- Bought 2,565 shares of CapitaLand Integrated Commercial Trust.

SRS

Security	# shares	Price S$	%
OCBC Bank	900	12.47	13.16
SGX	1,300	9.31	14.19
SATS	2,200	3.91	10.09
ST Engineering	3,000	3.73	13.12
Singtel	2,000	2.43	5.70
ComfortDelGro	6,900	1.36	11.00
Sheng Siong	8,700	1.49	15.20
HC Surgical	19,500	0.51	11.66
Silverlake Axis	21,300	0.235	5.87

Portfolio Market Value = $85,276

Trade Actions
- Bought 3,600 shares of ComfortDelGro Group.
- Bought 1,300 shares of ST Engineering.

Commentary:

After a stellar performance in 2021, the strong momentum continued in the local bourse till mid-January when the jubilant mood started to fizzle. The Straits Times Index managed to clock a respectable 4.0% return for the month of January, even though the S&P 500 Index is down 7.6% YTD.

With interest rate hikes poised to happen this year, analysts are saying the U.S. Fed will likely adopt the Kokomo treatment (from the classic song with the lyric, "we'll get there fast, and then we'll take it slow.")

A higher interest rate means heavier debt servicing for companies, and a bigger discount rate for stock valuations, both of which are supposed to be bad for equities.

Then, there is the sabre-rattling between NATO countries and Russia over Ukraine, sending war jitters all over Europe.

Investors are starting to find reason to take money off the table.

I added positions in ST Engineering and ComfortDelGro in January as their stock prices retreated. I also took a stab in the odd lot market to round up my position in CapitaLand Integrated Commercial Trust. This should make my disposal easier at a later time.

It is earnings season, but not many companies on my watchlist have reported yet. Micro-Mechanics Holdings turned in a decent 2H2021 report card, which was expected, given the red-hot demand for semiconductor chips. A 6 cents DPS was declared (same as previous period).

Up north, Genting Hong Kong Ltd, parent company of cruise operators Star Cruises and Dream Cruises, filed for provisional liquidation. The company had become insolvent under the burden of its debt and liabilities. Dream Cruises itself filed a winding-up petition on 27 January.

World Dream (Photo credit: Dream Cruises)

My family had just taken a trip onboard World Dream last December. We enjoyed the food, performances and activities onboard the majestic liner. While it has programmes catering to families, the ship is really a floating gambling den in thin disguise, with jackpot machines everywhere on the main deck and poker tables in plain sight.

Locally listed Genting Singapore isn't adversely impacted by the above event, as it has no cross-holding with Genting Hong Kong. With a $3.1 billion cash buffer and liabilities at a third of that, Genting Singapore isn't in danger of the same fate. That said, the company isn't faring well either, with limited tourist arrival via the VTLs and SMM requirements restricting its operating capacity.

January also saw OCBC Bank suffered its worst PR nightmare in recent years. Some of its customers had lost their life savings to sophisticated phishing scams within minutes. CEO Helen Wong likened the whole experience to 'fighting a war' [news]. There doesn't seem to be major reputational damage though, and OCBC stock price had stayed mostly intact. Altogether, OCBC completed goodwill compensation of $13.7 million to 790 victims [news]. A painful episode for all stakeholders.

As a OCBC customer, I did receive a strange SMS two weeks ago, prompting me to login. The sender name was OCBC in round brackets. It seemed innocent enough. But the text message came with a questionable bit.ly link, which aroused my suspicion. I deleted the SMS after some thought. Better be safe than sorry.

Recently, my spouse broached the topic of paying down the mortgage on our 5-room HDB flat. We still have about $350,000 outstanding. Given the potential for multiple U.S. Fed interest rate hikes this year (which Singapore tends to follow in lockstep), this issue has taken on additional significance. Currently, our mortgage is pegged to DBS FHR6 plus a step-up rate. While my spouse and I are confident we can handle the increase in accrued interest comfortably, whether this is a good use of our money is another matter. Unfortunately, we had just repriced our mortgage late last year. This means we are locked in commitment for the next two years. Nonetheless, I have opened a POSB Save As You Earn (SAYE) account, which will automatically debit $3,000 from my salary account each month. The benefit is 2% interest earned on accumulated funds for the first two years. When our mortgage lock-up period is over, we should have sufficient savings to pay down the loan completely. That will truly be the moment when we can call ourselves debt free (short of the money we 'owe' ourselves in CPF.)

Two weeks into the new year, I came down with a bout of flu. Thankfully, it wasn't COVID-19. But still, it felt terrible and I was confined at home for five days. During this period, I binged on books that I kept in my cabinet. One of which is "The Instant Millionaire" written by Mark Fisher.

If you hadn't read it before, I recommend you take a look. It may bring about a mindset change.

Having pumped up with motivation, I realized I am too 'timid' in my asset allocation. At this rate, I will likely fail to hit my retirement goal. Henceforth, I shall adopt a more aggressive posture and build up my portfolios at a faster clip. I won't divulge my interim stretch goal here, but I will reveal in a year's time whether I accomplish it or not. Fingers crossed.

Have a wonderful and prosperous Lunar New Year, my friends!

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Portfolio Summary for December 2021

As of 31 December 2021

CDP

Security	# shares	Price S$	%
DBS	700	32.66	7.87
OCBC Bank	1,500	11.40	5.89
SGX	1,200	9.30	3.84
SATS	3,900	3.89	5.23
ST Engineering	4,100	3.76	5.31
CapitaLand Invest	5,400	3.41	6.34
Singtel	6,100	2.32	4.87
Powermatic Data	5,000	2.94	5.06
Micro-Mechanics	1,300	3.38	1.51
ComfortDelGro	11,200	1.40	5.40
Sheng Siong	13,000	1.46	6.54
Genting Singapore	11,700	0.775	3.12
TheHourGlass	15,400	2.04	10.82
HRnetGroup	21,900	0.805	6.07
China Sunsine	31,000	0.485	5.18
HC Surgical	35,500	0.55	6.73
Silverlake Axis	60,800	0.275	5.76
Kimly	27,000	0.415	3.86
CL Int Com Trust	835	2.04	0.59

Portfolio Value = $290,330

Trade Actions
- None

SRS

Security	# shares	Price S$	%
OCBC Bank	900	11.40	12.68
SGX	1,300	9.30	14.95
SATS	2,200	3.89	10.58
ST Engineering	1,700	3.76	7.90
Singtel	2,000	2.32	5.74
ComfortDelGro	6,900	1.40	11.94
Sheng Siong	8,700	1.46	15.70
HC Surgical	19,500	0.55	13.26
Silverlake Axis	21,300	0.275	7.24

Portfolio Value = $80,885

Trade Actions
- Bought 3,600 shares of ComfortDelGro Group.

Commentary:

We have finally come to the end of a tumultuous year. When the shadow of the Delta variant is almost behind us, there arose yet another more infectious Omicron variant of the COVID-19 virus. Luckily, the Omicron variant is not as lethal as expected. Coupled with a high rate of vaccination, the downside impact is mitigated to an extent. Nevertheless, the virus is constantly mutating, and we will never know what may come in Year 2022.

Fortunately, human affairs are more predictable. The U.S. and Russia have started engaging in talks rather than military manoeuvres, so the chance of an armed conflict in Europe is unlikely at this point [news]. U.S. Fed Chairman Jerome Powell has been endorsed for another term. The Fed has clearly signaled its intention to end the bond buying [news] and will raise interest rates soon. This bodes well for banks who have been facing NIM pressure, but bad news for mortgagors. The MAS has cautioned about the rising debt level in Singaporean households [news]. A rate hike also spells trouble for companies deep in liabilities. Look no further than China's Evergrande as a poster child of what may happen to companies who mismanage their borrowings. This is one reason why I steer clear of most REITs and have a preference for companies with minimal debt or are debt-free.

For myself, I have finished the last instalment of my son's endowment plan, which means my future income can be freed up for other use (like bullets for my investment portfolio!) I completed my CPF and SRS Top-ups in December too. I just found out that I have hit the cap for my CPF Special Account (SA) and Medisave Account (MA) in 2021. Come 2022 when the ceiling is raised further to $192,000 for SA and $66,000 for MA respectively, I will be making another contribution before the Lunar New Year. The aim is to maximize the income tax relief.

Investments-wise, I have been disciplined in following my rules this year. I stuck to only companies on my watchlist (regardless of how appealing those cash-burning unicorns and cryptocurrencies appear to be!) I waited patiently for the stocks to fall from their sky high prices before taking small bites at a time. I consider myself a weirdo investor - Lofty valuations of my portfolio doesn't make me happy. On the contrary, I feel excited when stock prices plunge, because it means I get opportunities to add on my positions. For months when there wasn't any buying opportunity, I saved up the money. So far, I have managed to rebuild a sizeable war chest. I hope to be able to deploy it in 2022.

In summary, 2021 has been a satisfactory year for me in terms of investment and working towards my goal of financial freedom. While I faced psychological stress due to juggling Work-From-Home arrangement and my children's Home-Based Learning, I am glad my family managed to stay safe and healthy. As the population achieves herd immunity, my hope for 2022 is that the COVID-19 virus will become no deadlier than the seasonal flu, and that we can regain some semblance of life prior to the pandemic (e.g. no requirement for outdoor mask wearing). I also hope to travel overseas again.

Have a wonderful New Year, my friends!

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Portfolio Summary for November 2021

As of 30 November 2021

CDP

Security	# shares	Price S$	%
DBS	700	29.87	7.22
OCBC Bank	1,500	10.98	5.69
SGX	1,200	8.93	3.70
SATS	3,900	3.80	5.12
ST Engineering	4,100	3.81	5.40
CapitaLand Invest	5,400	3.36	6.27
Singtel	6,100	2.47	5.02
Powermatic Data	5,000	2.91	5.03
Micro-Mechanics	1,300	3.20	1.44
ComfortDelGro	11,200	1.37	5.30
Sheng Siong	13,000	1.46	6.56
Genting Singapore	11,700	0.77	3.11
TheHourGlass	15,400	2.16	11.49
HRnetGroup	21,900	0.795	6.01
China Sunsine	31,000	0.49	5.25
HC Surgical	35,500	0.57	6.99
Silverlake Axis	60,800	0.285	5.99
Kimly	27,000	0.415	3.87
CL Int Com Trust	835	2.11	0.61

Portfolio Value = $289,513

Trade Actions
- Bought 3,300 shares of ComfortDelGro Group.

SRS

Security	# shares	Price S$	%
OCBC Bank	900	10.98	13.10
SGX	1,300	8.93	15.39
SATS	2,200	3.80	11.08
ST Engineering	1,700	3.81	8.58
Singtel	2,000	2.36	6.26
ComfortDelGro	3,300	1.37	5.99
Sheng Siong	8,700	1.46	16.83
HC Surgical	19,500	0.57	14.73
Silverlake Axis	21,300	0.285	8.05

Portfolio Value = $75,457

Trade Actions
- Bought 3,300 shares of ComfortDelGro Group.

Commentary:

News of the Omicron variant of COVID-19 virus spooked investors worldwide at the end of the month. I took the opportunity to take a small bite of ComfortDelGro Group as its price sailed lower...only to see it tank even further after the news. Sigh. That just goes to show how volatile the stock market is these days.

It should have been a good year for most investors. The S&P 500 Index has soared an admirable 24 percent year-to-date. Even our local Straits Times Index has done well, having risen nearly 10 percent YTD. It is unlikely we will see major price (mood?) swings in December, but in the event opportunity knocks, I have my dry powder ready for deployment into the stock market.

December also marks the time of the year when I experience HUGE cash outflows. Firstly, there is the premium due for my son's endowment plan. Thankfully, this is the last instalment, which means the money vested will start to roll on its own until my son hits university age. I will not have to worry too much about the enrolment fee.

Then, there is the CPF Retirement Sum Topping-Up (RSTU). I do this every year to grow my CPF funds at a good interest rate while earning some income tax relief at the same time. Lastly, there is the topping-up of my Supplementary Retirement Scheme (SRS) account. This is another method I use to grow my retirement fund tax-free. My company also does a 50% matching of my SRS contribution up to a certain amount, so it is like an annual bonus.

Looking ahead, the Omicron variant threatens to rock the boat for every person, business and country again. It has been two years since the first appearance of the COVID-19 virus, and now it looks like a neverending war. Mask wearing has become an essential part of everyday life. I can only hope for the day when we no longer have to live under the shadow of the pandemic.

Enough of the sad stuff. Have a jolly Christmas, my friends!

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Portfolio Summary for May 2020

As of 29 May 2020

CDP

Security	# shares	Price S$	%
DBS	400	19.47	6.74
OCBC Bank	1,500	8.55	11.10
SATS	3,900	2.66	8.98
ST Engineering	4,100	3.19	11.32
CapitaLand	1,700	2.89	4.25
Singtel	4,000	2.49	8.62
Powermatic Data	2,800	2.40	5.82
ComfortDelGro	7,900	1.44	9.85
Genting Singapore	11,700	0.785	7.95
Old Chang Kee	5,000	0.695	3.01
HRnetGroup	11,600	0.495	4.97
HC Surgical	19,100	0.305	5.04
Nam Lee Metal	28,200	0.305	7.44
Kimly	27,000	0.21	4.91

Portfolio Value = $115,533

Trade Actions
- Added 600 shares of OCBC Bank.
- Added 1,600 shares of ST Engineering.
- Added 1,900 shares of SATS.
- Added 2,000 shares of Singtel.
- Added 3,300 shares of ComfortDelGro.

SRS

Security	# shares	Price S$	%
OCBC Bank	900	8.55	12.20
SGX	1,300	8.28	17.07
SATS	2,200	2.66	9.28
ST Engineering	1,700	3.19	8.60
Singtel	2,000	2.49	7.90
CapitaCommercial Trust	5,000	1.75	13.87
Sheng Siong	8,700	1.57	21.66
HC Surgical	19,500	0.305	9.43

Portfolio Value = $63,071

Trade Actions
- None

Commentary:

SGX - Company was dealt a critical blow when MSCI decided to shift its equity index business to Hong Kong, to the benefit of HKSE. I can understand MSCI's rationale for wanting to tap a larger potential customer base in Hong Kong (due to its proximity to mainland China). It remains to be seen whether SGX management has been humbled by this episode, and how hungry and determined they are in securing SGX's lead in APAC derivative trading over the next year.

Singtel - Full year net profit declined 65% y/y to S$1.08b. Excluding Airtel, net profit declined 21% y/y to S$2.42b. Winning the 5G spectrum means high capex ahead. Board cut final dividend by half to conserve cash. Management is also looking to sell off Optus' tower assets to raise cash. At current price, we're looking at 4.8% yield - still attractive in my opinion, unless there is unexpected COVID-19 pain ahead.

SATS - Poor company got bumped out of MSCI Singapore Index. Tracking funds will likely have to sell off their holdings. Took a chance to load. Still, I'm prepping for extremely lousy Q2 results.

ComfortDelGro - Another company that got dropped from MSCI Singapore Index. Taxi division is bleeding cash, but I'm heartened management is making an effort to secure side income for the cab drivers. Downside should be limited from this price point.

ST Engineering - Company with a comfortable order backlog. Customers may opt to delay contract delivery, but so far no news of clients backing out. MRO business will take a big hit, but that is water under the bridge.

OCBC Bank - Stock got sold down, probably due to its Wing Hang bank/HK protest exposure. Dividend may shrink a bit, but I don't foresee it being skipped like Stan Chart and HSBC.

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Portfolio Summary for January 2020

As of 31 January 2020

Cash Equity

Security	# Shares	Price	Portfolio %
DBS	400	$25.37	16.13%
OCBC Bank	900	$10.83	15.50%
SATS	2,000	$4.56	14.50%
ST Engineering	2,500	$4.11	16.33%
ComfortDelGro	4,600	$2.17	15.87%
Old Chang Kee	5,000	$0.74	5.88%
HC Surgical	19,100	$0.52	15.79%

Portfolio Market Value = $62,904

SRS Equity

Security	# Shares	Price	Portfolio %
OCBC Bank	900	$10.83	14.16%
SGX	1,300	$8.70	16.43%
SATS	2,200	$4.56	14.58%
SingTel	2,000	$3.30	9.59%
CapitaCommercial Trust	5,000	$2.06	14.96%
Sheng Siong	8,700	$1.23	15.55%
HC Surgical	19,500	$0.52	14.73%

Portfolio Market Value = $68,830


Commentary:

We had a smooth start to the year, but the peace did not last long.  News of the Wuhan coronavirus raised alarms throughout the world.  It is no wonder - memories of the 2003 SARS virus, which killed 33 people in Singapore, still linger. At time of writing, there have been 9,929 people infected and 213 deaths [link].  Thankfully, there are only 16 confirmed cases in Singapore so far.

Global fears started to take hold in the last week of January, causing the stock markets to roil in red.  I took opportunity of the sudden downturn to load up on a few stocks.

Trade Actions

HC Surgical Specialists
Last month, I had blogged about my initial purchase of HC Surgical Specialists ("HCSS"). (You can read it here.)  In January, I continue to accumulate the position.  I added 15,000 shares to my cash equity portfolio and 19,500 shares to my SRS equity portfolio.  On 9 Jan, HCSS reported its half yearly result, which was broadly in line with expectations [link].  The happy news is that the board had declared an interim dividend of 1.3 cents per share, up from 1.0 cent previously.  However, on analysis, this amount is 90 per cent of the mid-year EPS, which means there is little left in the company coffers for growth.  On 13 Jan, the company announced its first foray into Cambodia, inking an exclusive collaboration with The Prestige Hospital [link].  HCSS will provide consultancy services on the setup and operation of the hospital's endoscopy centre for a duration of three years.  While creating an additional revenue stream, the experience should be invaluable to the management as they steer towards a regional ASEAN expansion.

ComfortDelGro
I bought 4,600 shares of ComfortDelGro ("CD") for my cash equity portfolio.  CD is the majority owner of SBS Transit, ComfortCab, CityCab and VICOM.  The stock price had gone on a roller-coaster ride to a 52-week high of $2.90 before coming back to earth again.    Analysts have been skeptical of its performance due to lack of growth drivers, intense competition from Grab and high maintenance cost.  However, the operating expenses seem to have stabilized around 88-89 per cent of revenue over the past eight quarters.  Competition from Grab is yesterday's news and has definitely been priced in.  Given that Grab can't go on burning cash without making a profit forever, any further decline in the taxi division should be limited.  Lastly, the most recent 7 per cent increase in public transport fare adjustment should help to offset the bump in maintenance cost.

Frasers Commercial Trust
I sold off the shares of Frasers Commercial Trust ("FCOT") in my SRS equity portfolio.  This is in line with my shift in investment strategy from REITs to companies with healthy fundamentals.  FCOT is pending acquisition by its sister fund, Frasers Logistics & Industrial Trust.  I hate to be left holding an odd lot position, hence the decision to exit this investment.

Capitaland Commercial Trust
The REITs seem to be following the bigger-is-better trend these days, with the latest announcement being the acquisition of Capitaland Commercial Trust ("CCT") by its sister fund, Capitaland Mall Trust ("CMT") [link].  For every share, CCT owners will get $0.259 cash and 0.72 share of CMT.  Based on CMT price of $2.59, this works out to a fair consideration of $2.1238.  Does this mean we should buy CCT everytime it falls below $2.12?  Not exactly, but it does mean that CCT and CMT share price will be locked in tandem.  If you are a professional arbitrageur, there may be a chance to make profit if the share prices deviate.  During end January, I bought another 2,000 shares for my SRS equity portfolio.  The rationale is to have a total of 5,000 shares, which after the merger (if successful) will result in 3,600 CMT shares - a nice round lot number.  The merger is expected to undergo shareholder approval in May 2020, and be completed in June 2020.  That said, if CCT price climbs to an attractive level prior the merger, I will consider to offload my shares than stick around.

SATS
I bought 2,200 shares of SATS for my SRS equity portfolio when the stock price plummeted in the last week of January.  Investors were spooked by the implications of the Wuhan coronavirus.  DBS Group Research put out a report, noting that during the SARS period, SATS net profit fell 15 per cent from S$183.7m to S$155.9m on the back of 9.3 per cent year-on-year decline in revenue to S$868.7m.  However, it must be kept in mind that SATS performance bounced back immediately after the crisis.  Any impact is likely to be temporary in nature.


Savings

The CPF MediSave Basic Healthcare Sum (BHS) was increased from $57,200 to $60,000 with effect from 1 January 2020.  I took the chance to top up $2,800 to my MediSave account, and earn some tax relief at the same time.

Next month's Singapore Savings Bond (SSB) is likely to have an average yield of 1.71 per cent.  Sadly, the fixed deposit offerings in the private market are not that attractive either [link].  My wife's fixed deposit is coming due, and she is looking at endowment plans offered by insurance companies instead.  Besides a higher projected return, there is the safety provided by Singapore Deposit Insurance Corporation (SDIC).  The downside would be a longer lockup period.  The local stock market has retreated from its high a few months ago.  There are a few blue chip counters you can consider if you are a little more adventurous, with solid fundamentals and a dividend yield between 3.5 and 4.5 per cent.


Looking Ahead

It is said that the full blown impact of the Wuhan coronavirus will be known by yuanxiaojie (元宵节) or Lantern Festival, which is the 15th day of the lunar month (8 February 2020).  Talk is that the travel and hospitality sector will be badly hit this quarter (think hotels and airlines).  Nonetheless, it must be kept in mind that such crises are rare and few between.  Most companies recover from the loss of revenue soon after.  Yet it is precisely at the height of fear and panic that stock prices get attractive enough for investment.  I hope there will be more opportunities in February to build up my portfolio.

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