Saizen REIT: Attracting some big money?

Some big player seems to have taken an interest in Saizen REIT today. In a single transaction, 1.5m units were bought up at 17.5c per unit while 2.418m warrants were bought up at 8.5c each, setting the tone for the rest of the session.

I have some friends and readers who asked me if it is too late to go long on this REIT. Well, I might not be the best person to ask because I have been vested in this REIT for more than a year and at unit prices 16.5c and lower that I do not feel inclined to add to my long position at the current prices. However, I will try to be objective here.

The 100dMA continues to rise towards the 200dMA and seems on track to forming a true golden cross in time. The MACD continues to rise above the signal line in positive territory. OBV shows continual accumulation. The RSI is overbought but the MFI is not. This suggests that price has moved up too quickly but overall demand is still moderate. The upmove in price has not been accompanied by any crazy expansion in volume which suggests that a sharp pullback is unlikely.

The uptrend that started on 17 Dec is still strong. The rising 20dMA, in fact, approximates the trendline support. So, it is my opinion that this trendline support should be a strong one. As accumulating at supports in an uptrend is the thing to do, for anyone who wants to go long here, such a support is to be found at 17c in the near term.

For anyone who is thinking of selling into strength, the high of 14 Jan 2010 should be the resistance to watch. Selling at resistance is conventional wisdom. Of course, if resistance should break, more upside is likely and resistance could become support. When in doubt, hedge. Sell a portion, big or small is up to you and keep the rest, just in case.

Fundamentally, I believe the fair value of this REIT is closer to 19c and, if YK Shintoku's CMBS were to be successfully refinanced, the fair value would be closer to 20c.  These values assume that the warrants are fully exercised and they are what I think the REIT is worth. What Mr. Market thinks could be quite different.

Related post:
Saizen REIT: Golden crosses.
Saizen REIT: Steady.
Email exchange with a reader on some REITs.

K-Green Trust: Results for year ended Dec 2010.

Here are the highlights:

1. Profit after tax for the period from date of listing on 29 June to 31 December 2010 was $8.7 million, 22.1% higher than forecast.

2. Earnings per unit (EPU) for the period from date of listing to 31 December 2010 were 1.39 cents.

3. Net asset value per unit as at 31 December 2010 was $1.16.
 

4. Distribution per unit (DPU) of 4.31 cents was higher than forecast by 10.2%.
 

5. Annualised distribution yield was 7.9% based on unit closing price of $1.07 on 31 December 2010.

Full report here.

Some readers might remember an earlier blog post in which I questioned if K-Green Trust was a bad investment. In that post, I said "If it could land lucrative acquisitions with cheap debt, we could also see it reducing its payout ratio and keeping cash for asset renewal purposes. To think of KGT as a static business trust with no growth opportunities could be rather short sighted.  Why? Because it has zero gearing unlike CitySpring Infrastructure Trust." This is still a valid assumption but the Trust has yet to announce any such plans.

DPU of 4.31c will be paid out on 10 March 2011. This probably explains the bump up in the Trust's unit price to $1.10 today, forming a wickless white candle in the process. The buy signal on the MACD histogram yesterday has been confirmed. Drawing some Fibo lines suggests that further upside could meet with stronger resistance at $1.13. Is this attainable? The MFI has formed a higher low and further upside from $1.10 is probable.

Related post:
K-Green Trust: A bad investment?

Cambridge Industrial Trust: Land acquisition by SLA.

Cambridge Industrial Trust Management Limited, the Manager of Cambridge Industrial Trust (“CIT”) (“the Company”) wishes to announce that it has received a formal notice from Singapore Land Authority (“SLA”) on 11 January 2011 with regard to the compulsory acquisition of land on Tuas Road, Pioneer Road, Tuas West Road, Tuas West Drive and Tuas South Avenue 3 for the construction of Tuas West Mass Rapid Transit (“MRT”) extension and road works along the Pan Island Expressway, Tuas Road, Pioneer Road, Tuas West Road, Tuas West Drive and Tuas South Avenue 3.

Based on the Company’s initial assessment, three of CIT’s 43 properties will be affected to varying degrees by this land acquisition:

1) 30 Tuas Road (Lot No 1289X pt Mukim 7)
2) 120 Pioneer Road (Lot No 3237M pt Mukim 7); and
3) 1 Tuas Avenue 3 (Lot 1422X Mukim 7)
 
All or part of the land where these properties are situated will be possessed by the Government by January 2013.

Read announcement here.

Related post:
Cambridge Industrial Trust: Equity fund raising again.
Cambridge Industrial Trust: Fails to deliver.

Courage Marine: Dual listing.

On 14 November 2010, I said that "It would have to take a very bad 4Q 2010 to destroy whatever the company has achieved in positive numbers thus far in 2010."

Although the BDI has been declining and "even if 4Q 2010 does not turn in any profit which I believe is unlikely, net profit this year is already 120x higher than the whole of 2009!" So, I firmly held on, believing that the management would declare a generous dividend when the time comes.

Courage Marine gapped up today as it opened at 22c. My overnight sell queue was filled as I reduced my exposure to the counter by half. For me, locking in a gain now is like getting the dividend in advance. After all, the declining BDI is likely to have a negative impact on Courage Marine's earnings, going forward. The BDI has already broken the previous low and it is yet unclear where the next low would be but with greater increase in bulk shipping capacity in the near future, upside could be limited as supply outstrips demand.

 BDI
 (Source: Bloomberg)


What would I do with my remaining position in Courage Marine? I would hold on to see if price could go higher either through further developments in its plan to dual list in Hong Kong or through a possibly generous dividend payout.

Looking at the chart, immediate support is currently at 21c although it seems precarious as MFI and RSI spiked into overbought regions. Any weakness could see the counter pulling back to 20c which offers a stronger support and would correct the overbought condition. Further upside could see Courage Marine retest a many times tested resistance level at 23c. I would be tempted to sell more then.

Related post:
Courage Marine: 3Q 2010 results.

Courage Marine +13.2%; latest dual listing play 
Tuesday, 18 January 2011

© 2011 - The Edge Singapore

Courage Marine seeks dual listing in HK stock exchange. Courage Marine also believes the listing will also enhance its profile in Hong Kong and in China which are becoming increasingly significant markets and facilitate business opportunities, customer relationship and business development.
Monday, 17 January 2011

© 2011 - The Edge Singapore