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Saizen REIT: Insider buying again at 14c/unit.

Wednesday, March 30, 2011

Insiders know the situation of their companies best. It is reasonable to assume that they would not want to throw money down the drain as well. Saizen REIT's insiders have been steadily buying up more units at the current depressed price.

Argyle Street Management Holdings Limited, on 28 March 2011, bought 1,275,000 units at 14c a piece. On 29 March 2011, it bought another 200,000 units also at 14c a piece. See announcement here.

It seems to me that they are being very savvy and are patiently waiting for people to sell down the shares at 14c a piece. They are not pushing up the unit price. It would be sensible to take a leaf from their book and do the same, don't you think?

On a side note, this is the 1000th blog post for ASSI. :-)

Related post:
Saizen REIT: Insider buying more at 14c/unit.


JJ said...

Hi AK,

May I know what is the historical dividend from Saizen? (preferably last 3-5 yrs).
From wealthbuch portfolio, with the average price per lot bought at 0.161 the percentage yield of it is 9.32% which I think is quite attractive.

However, from SharesInv booklet, the yield was only 1.2%. which figure is actually correct. Do you have any idea where I can find this information?. From the same booklet, it indicates EPU for the past few years has been in negative territory.

How good is this counter in terms of value, as I noticed this is one of the top 3 counter you are holding (if I am not mistaken).

ps: looking for a dividend yield counter.

Currently not vested.



JJ said...

Also, what is your view over the aging population of Japan towards the future development of this counter.

AK71 said...

Hi JJ,

I believe I might have blogged about this before.

"I do not see the debt situation in Japan becoming unmanageable in the next few years. As the Japanese population ages over the next decade, they will start cashing out of government bonds. The Japanese government might have to sell US Treasury debt gradually then unless it is able to trim expenditure in a meaningful way or get its economy to grow more robustly in time. As you can imagine, all these will most likely not happen in, say, one or two years. It's going to take far longer."

Japan's debt issue and Saizen REIT.

Dal said...

You've made 1 lot of posts :) congrats

AK71 said...

Hi Dal,

It took me a while to register the joke. My brain is growing slower with less grey cells by the day. ;-p

That is certainly one way of looking at it. 1 lot of posts! :D

AK71 said...

Hi JJ,

Your first comment ended up in the Spam folder. No idea how it was automatically classified as Spam. I just rescued it.

Saizen REIT only restarted its income distribution last year in September. The DPU earlier this month in March was 0.52c. Annualised, this would mean a DPU of 1.04c.

At the current price of 14c, distribution yield is about 7.43%.
Initial estimates of yield was higher because we did not foresee that Saizen REIT's new loans are all amortising in nature. If not for this, distribution yield would be some 50% higher!

In terms of NAV, even fully diluted with all the warrants exercised, we are looking at 26c NAV per unit. Even if we should lose the 28 buildings affected in the recent crisis, we are looking at 22c NAV per unit. Remember, all the properties are freehold.

Yes, this is a longer term recovery story. Not for everyone, definitely. :)

touzi said...

Based on my experience with TIH, those guys at Argyle Street are good ! I don't know much about Kin Chan, but you can find some interesting information about V-Nee Yeh on the net.

AK71 said...

Hi touzi,

Thanks for the tip off:

The Honourable V-Nee Yeh, JP, Chairman of Cheetah
Investment Management Limited & Member of Executive Council,

He is some big shot in Hong Kong indeed. :)

Time to load up on Saizen REIT? ;)

JJ said...

Hi AK,

Thanks for the reply, almost thought why is the selective reply over comments:P

AK71 said...

Hi JJ,

You are welcome. :)

To date, I have replied to every single bona fide comment in my blog. I am sure of this. ;)

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