Month: July 2022

NDP Special Offer! Investors must have that “uh-oh” feeling. iFAST share price looks set for an explosive thrashing following the revelation of net loss of $2.69 million recorded in 2QFY2022. The net loss was a complete reversal from the $7 million net profit recorded in 2QFY2021. The management claimed that the bizarre net loss was attributable to the one-time estimated impairment allowance of $5.2 million from its exit of iFAST India Holdings Pte Ltd (“iFAST India Holdings”). Nonetheless, investors wasted no time punishing the counter as it sank from $4.00 on 22 July to a low of $3.72 on 25 July.

In my blog, I have cautioned before that whenever a listed company announced its financial result in the middle of the night or over the weekends, you can be sure like hell that the result is going to be awful. Indeed, this was what happened to iFAST when the Group released its 1HFY2022 financial result on 23 July 2022 (a Saturday morning). In the good old days, such a strategy could help to break the fall of iFAST share price. However, with the proliferation of financial blogs in Singapore, such trick may not work.

What goes up must come down. iFAST share price became stuff of legend among SGX stocks when the counter rocketed from $1.00 in 2020 to an incredible high of $10 in 2021. But the supersonic form of iFAST share price is simply not sustainable as the counter began to stall in 2022. The meltdown of iFAST was due to its misadventure in India. The latest India move to ban usage of pool account for mutual fund transactions followed the October 2018’s ban by the Indian authorities to ban upfront commissions for mutual funds.

In recent years, many countries are starting to ban sales …

NDP Special Offer! On 19 July 2022, Sembcorp Industries issued a profit guidance that the “financial results for 1H2022 is expected to be materially higher than 1H2021”. In this regard, investors should expect plenty of fireworks for Sembcorp Industries share price on 5 August 2022. However, before Nirvana can be reached, investors must put on their seat belt as stock market may be roiled yet again by the upcoming US FOMC meeting which herald another interest rate hike.

Being an utility company and waste management company, Sembcorp Industries’ businesses are deemed defensive, serving as an hedging investment amid the inflationary environment. Against the backdrop of soaring commodity prices, the Group’s Conventional Energy business is expected to be given a strong tailwind due to the strong energy demand and higher margins.

For FY2021, Conventional Energy business was the largest profit contributor as the segment raked in $174 million of net income. If it’s not for the $212 million impairment of Chongqing Songzao power plant incurred, Sembcorp Industries would have posted a significantly larger profit for FY2021. Henceforth, all eyes will be on the performance of the Conventional Energy business this year.

In FY2021, Singapore and India markets contributed 62% and 19% of revenue respectively. In Singapore, 95% of the electricity is generated using natural gas as raw materials. So the key index that would affect Sembcorp Industries share price would be the price trend of natural gas as it would affect the profit margin. On the other hand, Sembcorp’s thermal plants in India uses 70% domestic coals and 30% imported coals. Thus, the other index that would affect Sembcorp Industries share price should be the price trend of domestic and imported coal prices in India.

Note that this is an opinion article and not meant to be a financial advice. …

NDP Special Offer! Is NetLink NBN Trust share price on magic potion? The soaring interest rates and raging inflation had walloped global stock markets, sending growth stocks into a devastating tailspin. Amid the chaos, NetLink NBN Trust share price remains rock solid. Why so?

My last article on NetLink NBN Trust share price was in 2019. An update on this counter is long overdue. In addition, an SG Wealth Builder member wrote in to enquire about the “weak” performance of the stock. As such, I will do some deep dive into the outlook of NetLink NBN Trust share price in 2022.

Needless to say, the operating environment has turned significantly dark vis-à-vis the time when NetLink NBN Trust got listed in 2017. The pandemic, Russia-Ukraine conflict, rising inflation and interest rate hikes had torpedoed numerous growth stocks. In fact, global stock markets have been on a knife edge due to these dark events. Interestingly, NetLink NBN Trust’s business appears relatively unaffected by these adverse events for the past two years.

At an average trading price of $0.96, NetLink NBN Trust is being traded at a level above the IPO price in 2017. Year-to-date, NetLink NBN Trust share price has dropped marginally by only about 3.5%. In comparison, many technology stocks like iFAST, AEM and UMS had plunged by at least two digits. In the case of iFAST, the counter has crashed 50%. In this regard, NetLink NBN Trust has been pretty resilient.

Question now: is the form of NetLink NBN Trust sustainable in light of the challenging operating environment? Following the release of FY2022 financial result, the counter seemed a bit off-colour. The Group has a policy to distribute 100% of its cash available for distribution on a semi-annual basis. So when profit before tax dropped and depreciation costs …

Sign up for only $19.99! One man’s poison is another’s meat. The interest rate hikes by US Federal Reserve has rattled global stock markets. In June 2022, inflation in US rocketed to 9.1%, the highest in 40 years. Due to this, the market is fearing another interest rate hike of 75 basis points, potentially sparking a flight to safety among investors. While investors are fleeing from the stock market, demand for Singapore Savings Bond had reached record high.

Singapore Savings Bond (SSB) was launched by the Monetary Authority of Singapore (MAS) in 2015. The bond is designed to be a safe and flexible investment product that allows Singaporeans to meet their savings and investment needs. Though SSB is structured as a bond, the product has some features that make it more like a fixed deposit because of its liquidity. The distinctive feature of SSB is that the interest rate increases the longer you hold, with a 10-year maturity.

In the initial years, the demand for SSB had been lacklustre. When it was launched in October 2015, a total of $1.2 billion worth of SSB was offered but only $418 million was sold. The effective return per year for the initial batch was 2.63%, which was quite decent if you asked me. Since the launch batch, the demand has dropped consistently to a low of $13.7 million in November 2016 (effective return per year was 1.79%).

However, demands for SSB returned in full force when US Federal Reserve hiked interest three times (25 basis points each) in 2017 and four times (25 basis points each) in 2018. During that period, the average applied SSB was between $300 million to $500 million. With the rising demands, MAS also increased the offered amount gradually from monthly $150 million to $300 million. Interestingly, …

Sign up for only $19.99! How high will it go? Since my last article on Hour Glass share price in May 2021, the counter went berserk. Back then, I had predicted that Hour Glass share price had the potential to reach $1.30. However, the counter went on a rampage and smashed a record high of $2.50 on 6 May 2022. Given the splendid form of Hour Glass share price, investors must be feeling surreal.

The supersonic form of Hour Glass share price is in stark contrast to the decline in the broad market. Despite the horrible operating environment, the management of Hour Glass managed to steer the company through the storm. For the past five years, revenue grew steadily from $698 million in FY2018 to a high of $1.03 billion in FY2022. During the corresponding period, net profit soared from $50 million to $155 million, a three-fold increase. Henceforth, the bullish form of Hour Glass share price is based on strong business fundamentals.

The raging form of Hour Glass share price has led to the market capitalization to cross the $1 billion mark. At the point of writing, the market capitalization was $1.66 billion. Within a year, Hour Glass has reached the billion-dollar league. This is certainly a remarkable feat! Question now is: how did the watch retailer pull this off?

Data from the Swiss Watch Industry revealed that export of Swiss luxury watches to Singapore had exceeded the pre-pandemic level. And it seems that Hour Glass had seized the opportunity. The full-year financial report showed that revenue for the South East Asia & Oceania rose to $921 million in FY2022 from $646 million in FY2021. In comparison, North East Asia increased incrementally to $112 million from $96 million in last year.

Source: Swiss Watch Industry…

Sign up for only $19.99! Basically, the wheels came off the wagon. After charging to a record high of $37.20 on 14^th February 2022, DBS Group Holdings share price crashed to Earth, falling by a whopping 19% to reach $30.20 (at the point of writing). The bearish form of DBS Group Holdings share price certainly confounded investors as many are expecting the bank to benefit from the on-going interest rate hikes. What on earth is happening to the leading light of SGX?

Truth be told, DBS Bank turned in a subpar 1^st quarter performance despite the rising interest rates. Net profit dropped 10% year-on-year to reach $1.8 billion. Many investors were still bullish on DBS Group Holdings share price following the acquisition of Citibank Taiwan consumer bank in January 2022. So you can imagine investors’ disappointment when the 1^st quarter business update was announced.

The culprits for the poorer financial performances in 1QFY2022 were net fee income and other non-interest income. Apparently, the weaker market sentiment affected the bank’s wealth management and investment banking. The first quarter business update did not provide a detailed breakdown on the business performance. Nonetheless, I suspect the lockdowns in China (DBS has stakes in two banks in China) and the capitulation of cryptocurrencies may have led to collateral damage to the wealth management and investment banking arms of DBS, thereby causing DBS Group Holdings share price to lose steam.

Looking back, the collapse of TerraUSD stablecoin in May coincided with the spike in short-selling volume of DBS shares. For the week of 9 May, the short-selling volume surged to a high of 5.7 million shares. The reason for the short-selling attacks is unclear to me but it is well-known that DBS is entering the cryptocurrency space in a big way …

Sign up for only $19.99! Amid the soaring commodity prices, the sluggish share prices of SGX-listed commodity firms had left many investors feeling exasperated. Their agony is understandable. After all, commodity businesses are highly cyclical in nature. If the company share price missed this current boat, you never know when will the next upturn come. In this regard, will Rex Intl share price swim or sink?

A member of SG Wealth Builder has enquired the bearish form of Rex Intl share price in 2022. Indeed, oil prices had been in a stupendous form since the start of the year, driven largely by the war in Ukraine. Rex Intl is an oil exploration and production company with a focus in Oman, Malaysia and Norway. So logically, the current oil boom should lift Rex Intl share price. Yet year-to-date, Rex Int share price tanked 17%. Sound ridiculous right?

What made the form of Rex Intl share price so unpalatable to investors was that [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]

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