Category: Saizen

Buy @ $0.955

Jump Q during 5pm mtaching to get some to average down my $1+ ones. Had been too indecisive on adding more since it was $0.90-$0.92 as their Financials are not easy to understand… I think too much financial engineering in REITs nowadays, making it more challenging to understand.

Anyway, it jumped from aro' $0.92 to $0.975 recently. The likely reason is they have hired consultants to do a recommendation and this is expected to be completed soon, in 1st Half of June. What's interesting are,

• Cash = JPY 5Bil or S$62Mil => 22ct / share
• NAV = $1.17 or 18.38% Discount @ $0.955

My most preferred recommendation that can happen is the liquidation of Saizen, similar to what happened at MIIF. If this happens, they could possibly first pay out part of the 22ct / Share Cash as Capital Returns followed by the sale of their assets (which may take a while). This may result in a possible return of 15-20%.

The worst case recommendation would be a continuation of their current business, perhaps with Equity / Debt Fund Raising to grow their AUM….

Other factors considered,

• Yield = 6.81% ; Gearing = 38% or 32% (Net of Cash)
• 2H (Jun) around the corner and expected DPU = 3ct+
• JPY after weakening by 30% from 2012 to 2103 has been stable since Nov-13
• Abenomics appears to be working for now

In the short term, I'll likely collect more to bring down my average price further. Any change in plan will be after the recommendations are released… 😀

Sell @ $0.189

Contra off.as overdue. Further, I had exceeded my free cash when I bought KGT as I'd forgotten to record one earlier Vard purchase. That was also why I sold some Neratel via UOBKH ($$ is credited on T+3) so that I could have covered for this shortfall by doing my POEMS payment on T+4. 😀

Buy @ $0.184

Partially replace those that were sold 1 week+ back when MS put in a 5Mil shares buy order @ $0.195 during 5pm matching (jumped from $0.186 last done at 5pm).. Thanks to Sam for alerting us and of course MS for their huge order… 😀

Sell @ $0.192

Decided to contra off as it hit my target for a short term trade. Will also sell off my initial buy if prices continue to go up as that's the only other purchase that's making profit. 😀

One outstanding homework is to check if their Operating Cash Flow is indeed more than what is paid out as I'd noticed they also do Loan Repayment.

Buy @ $0.189

Big drop from $0.20 to $0.205 after their Q3 results last Friday (AM). Not a DPU payout quarter as they do semi-annual payouts.

Have only done a quick read. Looks like there'd been a big negative impact of the weakening JPY and some one-time expenses due to loan re-arrangement. Looking at just the NAV alone, it dropped from $0.27 to $0.25 (~-7.41%) last Q. But, now, looking at their "Statement of distributable income from operations",  it's very interesting to note that they have been deploying cash for loan principal repayment. By lowering the amount for Q313 (Mar), they'd been able to mitigate the additional expenses. My guess is that for next Q, it's highly possible to maintain the previous DPU = 0.66ct if they want to. Without that, my worst case guess is a drop to 0.6ct.

The other observation is that although Gearing had increased to 39% (from 31%), they do have JPY1.07Bil in Cash (down from JPY2.24Bil in Jun-12) at the Company level, which can be used for either Shares Buy-Back or acquiring more properties to improve on the earnings and DPU.

Looks like lots of uncertainty which can only mean volatility. Let's see if I can trade with this current buy. 😀

Buy @ $0.199

Over the weekends, realised that ASM Fund (Kin Chan & V-Nee Yeh has deemed interest) was selling at $0.1904 on 4-Apr. So, very likely, they'll continue to sell down their stake even at current prices. Never mind, continue to add to my collection and hope for the best! Added fears today is N Korea missle launch, everything looks slightly cheaper now. 😀

Buy @ $0.205

Average up my $0.188 ones to do short term bets. Yield = 6.44%. Recent surge is largely due to positive reaction to news that Japan intends to print money freely, following the example of USA. In the short term, this has caused Yen to weaken but the expected longer term benefit is a recovery from their decades long deflation. Next DPU payout will potentially be lower.

The optimism in share price (hit a high of $0.23) is however being negated by the continuous selling by the ASM funds, which are managed by Kin Chan / V-Nee Yeh, who're also the controlling shareholders of Saizen. Lowest price they sold at, is $0.2097 for 2,829,000 shares today. I was hopeful their lower cap would be $0.215  based on yesterday's data but now, it looks like they may even sell at $0.205! Looks like my short term punts are going to turn long term soon…:D

Buy @ $0.188

A new addition to  my portfolio. Assets are all in Japan, Residential Properties. Was listed on 9-Nov-07 @ $1.00. Bad timing as it was subsequently hit by the US Financial Crisis. Did a few value destructive Rights Issues and latest NAV = $0.27. For Japan assets, the key risk (Double Whammy) is FOREX (S$ very strong) + Deflation (20+years already) which'd also contributed to the decreasing NAV.

Controlling shareholder is V-Nee Yeh, a Hong Konger @ ~17%. I'd previously not subscribed for this IPO as I was fearful of foreigners coming here to list in SGX. But, recently, I'd read in the book 'The Value Investors: Lessons from the World's Top Fund Managers' by Ronald Chan that V-Nee Yeh is quite a famous Value Investor from Value Partners (quite well known and sometimes compared to Warren Buffett aproach). My interest was piqued after that…

After IPO, no DPU was paid till Jun-10. Their DPU / NAV / Shares Issued record,

• Jun-10 : 0.26ct / 40ct / 953M
• Dec-10 : 0.52ct / 36ct / 1122M
• Jun-11 : 0.50ct / 32ct / 1182M
• Dec-11 : 0.61ct / 35ct / 1235M
• Jun-12 : 0.63ct / 30ct / 1424M
• Dec-12 : 0.66ct / 27ct / 1418M

IIRC, some of the Rights came with attached warrants. When exercised, it increased the numbers of shares. They also have a Shares Buy-Back program in place which explains the drop in number of shares from Jun-12 to Dec-12.

Yield = 7.021% ; Gearing = 32% ; NAV = $0.27

Here, I'm kind of switching from A-HTrust which has similar Yield and FOREX risks. I'm also betting on Abenomics to beat deflation. Recent impact is the weakening of Yen, which may impact the next DPU negatively. Hopefully, this'll be offset by the positive impact of inflation…:D