Tea with AK71: Macarons from ZUJI.

Today, I got a treat from ZUJI. They sent me a box of six macarons. What are macarons? I know what is macaroni. ;-p

Very nicely boxed and ribboned.

 
Wikipedia says it is "a sweet confectionery made with egg whites, icing sugar, granulated sugar, almond powder and food coloring. The macaron is commonly filled with buttercream or jam filling sandwiched between two cookies."

Letter says to eat within 3 days but the expiry date on the box says 8 Dec 2011.

According to a colleague, these macarons are quite pricey and they are being sold in atas places like MBS. Price? $3+ each! Oh, my goodness! I could have a very good lunch for $3! Sorry for the exclamations but I am not well informed when it comes to atas food and atas malls.

If I was not told, I would have thought the box of macarons is at most $5 in price. So, this box of 6 macarons is worth more than $18!

I was told that Canele is definitely branded.

Macarons melted and cracked during delivery but the aroma was heavenly. Yummy too.

Oh well, just food to me. It is very nice of ZUJI to send me something sweet for booking hotel rooms and sometimes air tickets through them. I do have a sweet tooth. :)

Planning a trip? Check if ZUJI has a good deal for you! Click here.

LMIR: Too cheap to sell.

Some who managed to get a meaningful number of excess rights might be thinking of selling these rights for a quick gain. After all, selling at 36.5c today would mean a capital gain of 5.5c or 17.7%. This is more than 18 months' worth of income distribution from the REIT if we were to use my estimate of 3.26c in annual DPU, post rights and acquisitions.

Personally, I wouldn't sell my rights units as I am investing for income. I will be getting 10.5% distribution yield on cost. That is pretty good, especially when we consider the fact that its gearing level is below 10%.

However, if I should consider selling, at what price would I sell? Similar to First REIT, I feel that an 8% distribution yield should be fair. 8% distribution yield is still fairly high but looking at First REIT's unit price, it would seem that Mr. Market is not willing to accept a yield lower than 8% for a REIT with an Indonesian focus.

Some might argue that LMIR traded in excess of 60c a unit not too long ago. Even at just 60c, it would mean it had a distribution yield of 7% (based on the estimated annual DPU of 4.2c back then), a full percentage point lower than 8%. A persuasive argument.

So, when would we see fair value for LMIR? When its units are trading with a distribution yield of between 7 to 8% would be my guess. Assuming that its annual DPU does not change from my current estimate, that would mean a unit price of 41c to 46.5c. It is currently still too cheap to sell.