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CapitaMalls Asia: Interim dividend declared.

Thursday, July 21, 2011

Today, during lunch hour, when I read that the management is declaring an interim dividend of 1.5c per share (XD on 31 August and payable on 16 September), I immediately put in a buy order. I feel that it is a generous payout for a growth company and testament to the fact that it is doing well.

2Q 2011 EPS: 4.2c
1H 2011 EPS: 5.5c
NTA per share: $1.52

See presentation slides here.


Its share price closed at $1.45 today. This is at support. We shall have to wait and see if it would go higher from here. I see gap resistance at $1.55 and if it were to be overcome, we could see $1.64 next. Will my purchase today be rewarding? I wonder.




18 comments:

ZHANG Zheng said...

Hi AK
For CapitalMall Asia, the dividend yield is only about 4.5-5.5% based on the current share price of S$1.45. May I know what is the merit of this company that you would like to invest in (besides other higher yield REITs, like Cambridge or AIMSAIMIREIT)? Its growing prospect?

Thank you very much.

AK71 said...

Hi Zhang Zheng,

The dividend yield is closer to just 2% per annum. If it were 4 to 5%, I would be ecstatic! :)

I invest in CapitaMalls Asia for growth, not income. For income, it would be the REITs.

The company's assets would be revalued upwards in time, especially its assets in China. Also, imagine how much these assets would be worth in S$ terms once China allows the RMB to appreciate more realistically.

The NPI yield of its Chinese properties are north of 8% easily while its latest purchase of Iluma shopping mall in Singapore did not even make 4% NPI yield. So, in terms of yield on its investments, being heavily invested in China will benefit the company.

I have no doubt that this company is worth a lot more than its share price now. Trading at below its NAV now presents an opportunity to accumulate.

However, I am corrupted by TA and would like to buy more at lower prices which could happen since the counter is stuck in a stubborn downtrend. ;)

Raelynn said...

dear AK,

i'm liking most things of what i see in singaporean capitamalls, bought 3 lots at 1.45. slightly concerned about iluma though. not too sure about how are they going to pull off improving the traffic at iluma if it doesnt improve the tenant selection. they need something that will draw new crowds to iluma, i somehow have the impression that most tend to settle in bugis junction and not cross over to iluma because the mrt station is located there.

singapore is quite saturated in terms of malls, hence it is in my opinion that it's good that they are investing in China's first line and second line cities because i recall that human flow in the china's more popular cities are at a bottle neck in terms of rent and job availability so more job seekers are settling in cities that are "the next best option".

AK71 said...

Hi Raelynn,

Good to hear from you.

CMA's investments in China will take time to bear fruits and they are just beginning to flower. :)

I don't know if this counts for anything but I like Iluma and would visit periodically. My last visit to the mall, I found that it was more crowded than before.

I suspect that the link bridge between Bugis Junction and Iluma is useful in channelling some crowd to the latter as the former is really overcrowded.

I also noticed that many shops in Iluma have closed down and CMA is probably going to rent the shop lots to new tenants at higher price psf. That's my suspicion. Still work in progress and we just have to see how things turn out. Synergy between Bugis Junction and Iluma should be a natural next.

Looking forward to more good news, good luck to us all. :)

Raelynn said...

dear AK

heh, indeed it has been quite some time since i have commented due to exams and such. i have been reading constantly though =)

it's good to hear about iluma from someone who does visit and that there is a growing crowd. the last time i went over was last year ^^" indeed good luck to us all. do you happen to remember the ipo price for this one??

Anonymous said...

Hi AK,

Would like to ask a simple question on dividend payouts..
Am i right to say that if i were to buy a stock a few days before XD and sell it after XD will I be entitled to get the divident payout?

Thanks!
jay

AK71 said...

Hi Raelynn,

Hope you do well for your exams. :)

IPO price for CMA? I remember this one because a friend got in at IPO. $2.12/share.

AK71 said...

Hi Jay,

Yes, you are absolutely right. :)

Anonymous said...

Thanks alot AK!

Then isn't it abit cheat if i just buy lots of lots before xd and sell once xd is over and get the divident?!
jay

AK71 said...

Hi Jay,

There is always a chance that share price could fall upon XD. ;)

qinzheng said...

Hi AK, all capitaland groups counters are under selling pressure, i dont see why capitaland's value is only $2.95, that is what holding me back from buying capMallAsia. I see higher growth in capitaland itself, just my 2 cents.

Raelynn said...

dear AK,

oh.. and me mom still rolled her eyes at me when i told her that i bought at 1.45 -.- until i reminded her that her IPO CMA was 2.12. gahhh.

dear jay,

there's also the possibility that the share price drops more than the dividend declared after XD =)

AK71 said...

Hi Qinzheng,

Good to hear from you.

Well, price and value very often have a disconnect.

TA gives us insights into the psychology of market participants which affects price.

FA gives us insights into the value of a company.

So, price is what we pay and value is what we get. ;)

AK71 said...

Hi Raelynn,

Well, CMA is stuck in a stubborn downtrend and until it breaks out of this downtrend, your mom could be right in rolling her eyes at our recent purchase. Haha.. ;)

I hope she is wrong, of course. ;p

qinzheng said...

Hi AK,

no matter is TA or FA, we just have to go along with the wave, we all know all this are controlled by the BBs, if they want push the counter down we can only play along....
As you can see for Capitaland n CapMallAasia their price has been suppress by whoever...
Is just the matter of time "they" will push up the price. that is when holding power comes in...
btw, i have vested in Capitaland, average cost is $3.8+...

AK71 said...

Hi Qinzheng,

Yes, we are merely players on a very big stage. ;)

Both CPL and CMA are trading below NAV now. So, it could be that the situation would be corrected soon. However, prices could get more depressed too.

Like you said, we just have to play along. If share prices continue to fall, the companies' valuations would become even more compelling. ;)

Pat said...

Hi AK
$1.45 as support level after reporting good earning profit and first-time interim dividend (due to excellent performance), the price is unexpectedly go in circle between 1.435-1.445 past 3 days. the movement is pretty disappointing though.

AK71 said...

Hi Pat,

Yes, disappointing. However, beyond disappointment, this is probably Mr. Market's way of cautioning long only traders.

When price moves down or sideways even with good news, it doesn't get more bearish than this. Things don't look good and, by this, I am referring to the share price, not the business.

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