SG Wealth Builder

Raffles Medical share price suffered a major correction which saw it dropped to a one-year low of $1.20. After reviewing the latest financial results, I don’t see any major concern on the healthcare provider’s performance. In fact, I think the correction is a healthy one and should not raise any red flag for investors.

The correction in the Raffles Medical Group share price is indeed puzzling given that the Group announced a record quarterly revenue of S$120.1 million in Q2 2017, a 1.0% increase from S$119.0 million in Q2 2016. Net profit after tax attributable to owners of the Company increased by 0.5% from S$16.8 million in Q2 2017 to S$16.7 million in Q2 2016.

Whilst the recent financial result is nothing to shout about, it should not warrant such drastic decline in Raffles Medical share price. The only major concern I can think of should be the high capital expenditure for the China hospital projects. Raffles Medical is building not one, but two hospitals, in China in a bid to expand its investment moat. Construction of the 700-bed RafflesHospital Chongqing and 400-bed RafflesHospital Shanghai is progressing well. These hospitals are targeted to be operational by second half 2018 and second half 2019 respectively.

Ex-CEO of SGX, Magnus Bocker passed away last week due to cancer. Bocker came to Singapore with a big reputation of being a dealmaker. Prior to heading SGX, he made his name for selling OMX to Nasdaq for USD4.9 billion. Bocker took over from outgoing CEO Hsieh Fu Hua in 2009 but left in 2015 when he decided not to renew his contract. In this article, l am sharing my views on whether it is worthwhile to invest in SGX shares.

Under Bocker’s tenure, SGX implemented various initiatives aimed at expanding SGX’s market share beyond the stock market. Notably, revenue from derivatives now formed 40% of the annual revenue.  As a dealmaker, he also tried to transfer his merger and acquisition experience to SGX and made a bid to merge with Australia’s ASX. That bid ended up in failure when the Australian government rejected the proposal.

Bocker’s reign also saw SGX introducing a slew of policies targeted at boosting market liquidity and protecting investor’s interest. In 2014, dynamic circuit breaker was introduced to guard against disorderly situations in the face of rapid and unchecked market movements. In light of the penny stock crash in 2013, Minimum Trading Price (MTP) was introduced by SGX to prevent speculation and market manipulation.

SGX-listed, Hong Kong-based Noble Group warned on Wednesday that it is set to post a devastating loss of USD1.8 billion for the second quarter. The shock loss surpassed the full-year loss of USD 1.6 billion back in 2015 and brought to light the significant challenges faced by the commodity trader.

The market reacted immediately on Thursday morning, with Noble Group share price plunging by as much as 49% to $0.295. The counter recovered to close at $0.395 at the end of the trading day.

Record loss

The amount certainly blew me off and made me blinked twice. USD1.8 billion is a colossal amount of money. We are talking about losing USD1,800 million for one single quarter. Translated into Singapore dollar, that would mean SGD2,400 million. Make no mistake, founder Richard Elman has previously warned that Noble Group is likely to suffer losses until 2019. But nobody could have foreseen losses of such magnitude.

Compared to the second quarter loss, the first quarter loss of USD130 million seemed like peanuts. But the announcement of that loss back in March had bombed out Noble Group stock price. With the gigantic loss in second quarter, the share price is likely to experience another bout of carnage. 

It’s going to be a three-way battle for SingTel, M1 and StarHub as competition intensified with the entry of a new player in the telco industry. Against this backdrop, will SingTel acquire M1 or StarHub? Recent developments in Singapore’s telecommunication industry suggest that such consolidation is only a matter of time for the incumbent players.

With Australia’s TPG winning the fourth telco license in both Australia and Singapore, it is imperative that SingTel take decisive actions to defend market shares. It is now or never for SingTel.

The battle of the giants

With a gigantic market capitalization of $63 billion, SingTel is obviously the leader of the pack and is in pole position to gobble up either of the two smaller players. Among the three existing players, M1 has the smallest market capitalization – $1.75 billion. Since 2015, M1’ share price crashed from a high of $3.96 to $1.88 level. With the current form, M1 could easily fell prey to a hostile takeover.

Incidentally, M1’s substantial shareholders, Keppel Corp and Singapore Press Holding (SPH) are going through hard times as well and they may be tempted to offload their shares in M1 to SingTel. Keppel Corp may want to sell its stakes in M1 and raise capital to focus its fight against the slump in the oil-rig industry.

Is OCBC shares worth $50? Maybe even more. Recently OCBC made waves when it announced the offload of its 33.5% shares in United Engineers (UE) to a consortium led by Yanlord Group and Perennial Real Estate Holdings. The block sale consisted of shares held under OCBC, Great Eastern Holdings and the founding Lee Family. News of the deal propelled OCBC share price to a 5-year high and triggered a mandatory takeover offer for the rest of United Engineers shares.

The United Engineers Deal

The offer price for the UE deal was $2.60 and represented a price-to-book value of about 0.88. The fact that OCBC sold its stake in UE at a price below book value reflected the poor market sentiments. After all, United Engineers is still making healthy profits and is not considered a distressed asset at all. For the record, UE made a profit of $7.1 million in 1Q2017, a decline of 25% from last year. Hence, in my point of view, the block shares sale should have fetched higher price.

For OCBC, the deal would unlock value for shareholders and made business sense as property development is not OCBC’s core business. The sale is worth an estimated $550 million and is a windfall for OCBC.

Since young, I have always enjoyed eating Old Chang Kee’s signature curry puffs. The history of Old Chang Kee, however, goes as far back as 1956 when it was just a small stall in a coffee shop outside former Rex cinema. In 1986, the current chairman, Han Keen Juan bought over the control of the company and subsequently transformed the stall into a listed company.

On looking back, Old Chang Kee is a story of coming of age and its brand is synonymous with Singapore food heritage. With a humble beginning, Han Keen Juan has certainly grown the Old Chang Kee into a household name.

When it was listed in Catalist in 2008, the IPO price was $0.139 and the shares were 111% over-subscribed. Now trading at $0.815, it is time to examine whether investing in the shares is worth the effort.

Fourth quarter loss

The Group was cruising along finely when it was [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.]

Read my other articles on SGX stocks:

1. Formidable Challenger for Challenger Technologies Limited
2. The Hour Glass Limited
3. Raffles Medical Group’s Return on Equity

It certainly seems like Judgement Day for SPH as the media conglomerate’s shares plunged to an 8-year low. The share price free fell to $2.95 on 18 July 2017, below the $3.00 support level. During the dark days of the Great Financial Crisis, the lowest trading price was $2.40. But hey, we are not having a major market crisis now, aren’t we?

What’s going on and what’s wrong with SPH? Should investors run for their lives?

Like fellow SGX-listed SingPost, SPH belongs to the old economy. Both are struggling to adapt themselves in the new digital era. Technology has devastating impacts on their businesses as their models are being disrupted by consumers’ lifestyle changes.

For SingPost, most companies are switching to electronic statements instead of traditional postages. Hence, SingPost is now transforming itself into an eCommerce logistics by leveraging on its existing postal networks. Similarly, SPH is facing disruptions from technology as most people switch to digital instead of printed newspaper. This is understandable as who would want to read yesterday’s news when you can receive the latest updates on the breaking news from online or through social media?

But what is shocking for investors was the massive decline seen in SPH’s advertisement revenue.

On 10 July 2017, NetLink NBN Trust registered its final prospectus with Monetary Authority of Singapore, paving the way for the biggest IPO of the year. The offering price is $0.81. Initially, the offering price was estimated by analysts to be between $0.81 and $0.93. The low-end of the offering price could be indication of weak demand from the big boys.

With net asset of $3.07 billion and total units of 3.02 billion, the Net Asset Value (NAV) is about $1.01. Given that the offering price is only $0.81, NetLink NBN Trust IPO is considered surprisingly under-valued. It should be noted that the majority of the assets is the network infrastructure, which are recognised initially at their fair value at the date of acquisition and then depreciated over their remaining useful lives. The estimated remaining useful life for the purposes of calculating depreciation for NLT’s network assets is between 25 and 50 years, depending on the type of assets.

As cited by several local investment bloggers. there are a few risks that investors need to note for NetLink NBN Trust.

First, a few bloggers had mentioned that although NetLink NBN Trust has a monopoly in the residential fibre network, it is tightly regulated by IMDA.

Once upon a time in Singapore’s banking fraternity, there were four local “Heavenly Kings” – Development Bank of Singapore (DBS), United Overseas Bank (UOB), Overseas Union Bank (OUB) and Oversea-Chinese Banking Corporation. They are all household names and I believe most Singaporeans have experiences with their bank products or services.

On looking back, the devastating effect of the Asian Financial Crisis in the nineties and the industry liberalization brought forth by the new Monetary Authority of Singapore (MAS) regulations changed the banking landscape forever. Through the years, UOB has staved off these challenges and emerged as one of the most powerful forces among its peers.

Among the four “Heavenly Kings”, OUB was the smallest player and was founded by the late Lien Ying Chow. In the early 2000s, the local banks were under pressure by the government to consolidate. This was because Singapore government wanted to reduce the number of local banks to pave the way for bringing in more foreign banks.

The vision was to shape Singapore into a global financial centre with strong presence of international banks that can bring in investments and thus create high value banking jobs for Singaporeans.

Being the smallest bank, it was no surprise that OUB was the target of a bidding war between DBS and UOB.

The biggest IPO since 2011, NetLink Trust will be listed in SGX main board at offering price of between $0.80 and $0.93, raising between $2.3 billion and $2.7 billion.

When investing in stocks, always invest in companies in which you understand their business models, their products and services. It is also important to assess the companies’ competitors and financial performances. This article will share three things about NetLink Trust which I hope investors will find useful.

NetLink Trust background

Most Singaporeans may be more familiar with OpenNet, the predecessor of NetLink Trust. In 2008, OpenNet was owned by a consortium consisting of SingTel (30%), SP Telecommunications (15%), Singapore Press Holdings (25%) and Canada’s Axia NetMedia (30%). However, in 2014, SingTel, through NetLink Trust, bought over all the shares of OpenNet from the rest of the major shareholders.

On looking back, the 2014 consolidation should be part of the strategic plan to implement Singapore government’s Next Generation Nationwide Broadband Network (Next Gen NBN), which is a project under the Intelligent National 2015 (iN2015) masterplan seeking to transform Singapore into an intelligent nation and global city, powered by infocomm.

Next Gen NBN is Singapore’s ultra-high-speed broadband network capable of delivering speeds of 1Gbps and above, offering connectivity to homes, offices and schools in Singapore.

On 24 April 2017, Singapore’s leading private healthcare provider, Raffles Medical Group, announced that it is developing its second international tertiary hospital in China.

When completed in 2018, RafflesHospital Chongqing will be able to serve local and expatriate patients in the western part of China as well as foreign patients from Central Asian republics. Meanwhile, construction of RafflesHospital Shanghai has commenced and is proceeding smoothly.

For the past few years, Raffles Medical Group has been building its investment moat by increasing number of clinics, expanding its flagship hospital in Singapore, refurbishing existing clinics, acquiring overseas medical centres and developing new hospitals in China. Clearly, its intention is to grow into a regional healthcare player in order to capture market share.

Raffles Medical Group competitive advantage

Raffles Medical Group’s key competitive advantage is that its strong operating cashflow enabled the Group to support its various investments. This means that its existing operation activities are able to generate enough cash to fund business growth. For 1Q2017, the Group maintained its strong cashflow from operating activities of S$18.2 million in Q1 2017. This figure is more than sufficient to meet the investment and capital expenditure of $14.4 million in Q1 2017.

The need for overseas expansion is driven by the small market in Singapore.

In 2006, Singapore-based Creative Technology Ltd sued Apple Inc for patent infringement over a menu interface for an MP3 player. It was an epic corporate story of David versus Goliath and pitted Singapore entrepreneur, Sim Wong Hoo squarely against the late Steve Jobs.

But the outcome was beyond what most people had expected. In fact, Apple had actually agreed to pay Creative Technology Ltd a massive USD100 million to settle the suit.

The battle against Apple marked a turning point for Creative Technology, which at that point of time, had been searching for another holy grail to replace its blockbuster SoundBlaster audio systems. More than a decade has gone since the legal dispute, but Creative Technology is no longer the force it used to be. Although it has won the corporate battle, the business had declined to an almost unbelievable level.

Sales for the fiscal year 2005 was at a peak of USD 1.2 billion but by fiscal 2016, the sales amounted to only a paltry of USD 84.5 million. That was a massive decline by any standard and something must [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only.

Can founder Richard Elman save Singapore-listed, Hong Kong-based commodity trader, Noble Group? This is the most pressing concern for shareholders as the crisis-hit company battled crisis after crisis for over two years. The latest news on investments from a surprise Middle East investment group, Goldilocks Investment Company (GIC), must have brought a huge relief for shareholders.

While I certainly do not deem GIC as Noble Group’s new white knight, the latest investment is a sign of endorsement for Noble Group. GIC is part of Abu Dhabi Financial Group, a diversified global group with asset management of USD5 billion. The Middle East investor has a reputation of buying distressed companies.

According to the SGX filing on 22 June 2017, GIC purchased 50,546,000 ordinary shares in Noble Group. Taken together with GIC’s existing 15,454,000 ordinary shares it purchased on 19 June 2017, GIC became a substantial shareholder of NGL on 20 June 2017.

I am careful not to label Goldilock as a new white knight as the investment is not a form of cash injection in return for equity stake. It seems that the Middle East investment group bought the shares from open market and built up its stake within two days of the week.

Hailed by many analysts as Asia top telecommunication company, SingTel is facing heightened competition from emerging players seeking to knock it from the perch. Australia’s TPG Telecom stunned the market by not only becoming Singapore’s 4^th telecommunication player in late 2016, but also Australia’s 4^th telecommunication player in early 2017. Given the increased competition in Singapore, Australia and India, can SingTel fight gravity?

To put things into perspective, SingTel did not sleep walk into the dominant position in Asia by chance. Listed in SGX main board back in 1993, the company embarked on a slew of overseas acquisitions spree, with backing from Singapore sovereign wealth fund, Temasek Holdings.

As a result, SingTel enjoyed a massive investment moat of 600 million mobile phone subscribers across South East Asia countries like India, Philippines, Thailand, Indonesia, Singapore and Australia. This is an impressive feat that took more than 24 years to establish. In this regard, it is unlikely that TPG Telecom’s entry would pose short-term threat to SingTel.

In Singapore, the telecom industry is regulated by IMDA. When the regulator announced that a fourth license would be issued a couple of years ago, many investors and industry players were puzzled. While consumers certainly wish for a price war in light of the increased competition, having four players in Singapore wireless market does not make sense.

On 16 June 2017, HRnetGroup’s IPO on the SGX Mainboard created much hype among retail investors and local finance bloggers. Many investors had wanted a slice of the IPO because of the excellent financial performance indicated in the prospectus. But many investors may not be aware of Temasek Holding’s Pre-IPO investment in HRnetGroup.

What is pre-IPO and does it matter to you from the perspective of a stock investor? Read on to find out how the big boys make money in this game.

HRnetGroup and the big boys

Fundamentally, how big boys like Temasek Holdings make money is very different from retail investors in the market. Most of us made money upon selling the shares allocated during IPO. But then again, there is no guarantee that you would be allocated the IPO shares because for the public, the shares are allocated through balloting. There is also no assurance that the share price would rise above the IPO offer price. In short, for the man in the street, it is like punting when it comes to IPO.

However, pre-IPO works in a different manner. Big boys like Temasek Holdings want certainty in their return of investments and they also want to win the game.

After announcing a recent shock quarterly loss of $132 million, CEO Goh Choon Phong hinted that there could be retrenchments for Singapore Airlines (SIA). Arising from the first quarterly loss in five years, the premium airline has set up a Transformation Office to conduct a wide-ranging review, encompassing network and fleet, product and service, and organisational structure and processes.

Upon closer examination of the financial results, the explosive loss suffered by Singapore Airlines was largely due to the provision of $132 million for the EU court fine slapped on SIA Cargo. More than ten years ago, SIA Cargo was alleged to participate in an air cargo cartel with 10 other airlines. Due to this, the EU antitrust regulator fined the airlines a total of $1.2 billion.

The massive fine incurred by SIA Cargo was a wake-up call and reflected the structural change in the air freight market over the years. This could explain the rationale for re-integrating SIA Cargo as a Division within SIA. The move is expected to be completed by first half of 2018 and aims to improve synergy and efficiency. However, the quarterly results indicated that SIA Cargo was one of the best performers within the SIA group.

SingPost shares took a hit as the company announced a stunning quarter loss of $65.2 million. The loss came about after SingPost decided to write off $185 million for the ill-fated TradeGlobal, S$20.5 million for Postea Inc., and S$9.3 million for an industrial property at 3B Toh Guan Road East.

The latest setback for Singapore’s postal service provider came at a time of transformation for the 150 years old institution. As more and more companies switch to electronic statements, SingPost is transforming its business to eCommerce logistic. At the centre of the storm was the significant impairment of TradeGlobal, which was only acquired by SingPost less than two years ago.

Many investors were shocked that SingPost decided to write off its investment in TradeGlobal so soon. Two years are considered a relatively short time frame to judge a company’s potential growth. One plausible factor could be that the management is not convinced of a turnaround for TradeGlobal and hence, made the decision to cut losses early. It was reported that instead of a projected profit of S$9.4 million for FY16/17, TradeGlobal incurred a significant loss of S$25.8 million.

Given the extent of the impairment to SingPost’s investment in TradeGlobal, SingPost also appointed FTI Consulting, an independent global business advisory firm, which has verified that the impairment provision was properly calculated following an appropriate review process and that the assumptions adopted were reasonable.

The month of May had been horrendous for investors of Noble Group and many of them must be wondering if the shares would ever see daylight again. The short answer to this would be: not at the moment.

After two years of struggling, Noble Group was about to stage an impressive recovery when it announced a shocking quarterly loss of USD 129 million in May. That stunning news really knocked the wind out of investors and led to the collapse of its share price. The free fall of its shares also turned off potential white knight, Sinochem Group, which subsequently gave Noble Group the snub.

The financial results raised fresh question marks over the management’s ability to revive the company’s fortune and fulfill the debt obligations. Because of this, credit ratings agencies had been ferociously downgrading Noble Group’s credit ratings for the past few weeks. On 26 May 2017, it was reported that Fitch Ratings Ltd cut the commodity trader’s rating for the second time within the space of 10 days.

As far as I can recollect, it is very rare for a credit ratings agency to downgrade a company’s rating within such a short span of time. While such downgrading was common during the Great Financial Crisis period, we are talking about peace time here.

On 2 June 2017, SingTel received SGX’s approval to list NetLink Trust on the Mainboard, paving the way for the mega IPO of the year. This will be a short post to provide an update on the NetLink Trust IPO.

Since 9 February 2017, SingTel had announced that it had hired three banks to manage the initial public offering for its broadband subsidiary NetLink Trust. This is pursuant to Singtel’s undertaking to the Info-communications Media Development Authority (IMDA) to divest its stake in NetLink Trust, a 100%-owned associate of Singtel, to less than 25% ownership by 22 April 2018.

NetLink Trust designs, builds, owns and operates the passive infrastructure for Singapore’s Next Generation Nationwide Broadband Network (NextGen NBN). Under the IMDA’s structural separation requirements for the NextGen NBN, Singtel does not have effective control in NetLink Trust.

Most Singaporeans would be more familiar with OpenNet, the predecessor of NetLink Trust. In 2008, OpenNet used to be owned by a consortium consisting of SingTel (30%), SP Telecommunications (15%), Singapore Press Holdings (25%) and Canada’s Axia NetMedia (30%). However, in 2014, SingTel, through NetLink Trust, bought over all the shares of OpenNet from the rest of the major shareholders.

As a result of the acquisition, OpenNet ceased to exist and was renamed to NetLink Trust.

The gloves are off as SingTel engages in a battle with Australian rival, TPG Telecom. In late last year, TPG Telecom won the rights to become Singapore’s fourth telco operator. In early April this year, TPG shocked the market by winning the rights to become Australia fourth mobile operator in Australia.

It is still early days to assess the impact of the heightened competition from TPG but SingTel is at a cross-road as it has to compete with TPG in both the Singapore and Australia market. While the impact of a fourth telco in Singapore would have minimal impact on SingTel, the same cannot be said for the entry of a new competitor in Australia. This is because the Australia market is very important to SingTel, which traditionally derived the bulk of its earnings from the regional businesses.

In the fourth quarter ending 31 March 2017, EBITDA from Optus, SingTel’s subsidiary in Australia, was A$741 million, more than half of the Group’s EBITDA of S$1.31 billion. This is not surprising given that the Australia market is so much bigger than Singapore. Net profit was up 1% to A$250 million while operating revenue rose 1.6% to A$2.11 billion.

Against the backdrop of increased competition, Optus continued to enhance the competitiveness of its network – with A$1.5 billion in capital expenditure.

ISOTeam, a Catalist-listed company that specializes in eco-conscious Repairs and Redecoration (“R&R”), Addition and Alteration (“A&A”) and complementary niche services specialist in Singapore, announced a set of mixed financial results for 9MFY17. The group maintained its net attributable profit at S$5.1 million for the nine months ended 31 March 2017 despite a 5.2% dip in revenue to S$61.2 million.

One question that I have been asking myself is whether ISOTeam is over-rated. ISOTeam is Nippon Paint’s exclusive applicator of paint works for R&R projects and both companies had formed strategic partnership over the years with Nippon Paint taking up stakes of approximately 5.93% in ISOTeam through a shares placement in 2014.

Despite this, investors must realize that the R&R segment is an extremely low barrier industry and basically many companies can do the jobs that ISOTeam are doing. To put things into perspective, the exclusive applicator of Nippon Paint would not provide much competitive advantage for ISOTeam.

At the end of the day, when public organizations or companies tender R&R jobs, it is all about dollars and cents. The company which can do the jobs “cheaper, faster and better” will win the contracts.  This is apparently the case when ISOTeam’s topline in both 3Q2017 and 9M2017 was affected mainly by the decline in revenue generated by its core R&R business, which had faced intense price competition.

It is a battle that Noble Group cannot afford to lose. Today, the company requested for trading halt after it’s share price plunged by 32% following news of credit rating cut by S&P Global. This latest setback came after yesterday’s report that potential white knight, Sinochem Group, was not interested to invest in the embattled commodity trader.

The latest blows sent the Noble share price into tailspin, causing its market value to shrink to USD 400 million, a massive decline from USD 6 billion in 2015. This dark chapter of Noble gripped the market in maximum fear. Many shareholders would not be able to sleep well, fearing the worst for their investments. Can the beleaguered company turn the tide and emerge from the battle victorious?

The unfolding events of Noble Group are nothing short of intriguing. Once the largest Asia’s commodity trader, it used to be among the elites and was part of the Straits Times Index (STI) as recent as last year. In 2010, it’s share price was even trading at a high of $3.43. Those days must be surreal to existing shareholders who watched in horror as the share price keep falling over the past two years.

Some investors blamed the founder, Richard Elman, for the current situation that Noble Group is facing and there were calls demanding for him to step down as Chairman.

Sheng Siong is a local supermarket chain with 43 outlets located across Singapore. Listed in the Singapore stock market, this counter is popular among investors. When it got listed in the SGX mainboard on 17 August 2011, the IPO price was $0.33. Fast forward six years later, the share price has surged past the $1.00 milestone recently but investors must be wondering if Sheng Siong share price is inflated.

With a population of 5.3 million, the market for supermarket chain is very small in local context. Furthermore, the market is also saturated with other players, not to mention the mom-and-pop stores. Sheng Siong’s closest rivals are NTUC Fairprice and Dairy Farm which operates the Cold Storage and Giant outlets. Among the trio, Sheng Siong is the smallest operator. To compete effectively against these big boys, Sheng Siong must have the economy of scale and operating margin.

For many years, Sheng Siong’s gross profit margin had been excellent, averaging at least double digits. For 1Q2017, the gross profit margin was 25%, a slight increase of 0.5%. However, operating margin was only 9.5% for 1Q2017. What is the difference between gross profit margin and operating margin? Why is it important for investors to understand this financial metric?

Noble Group suffered another major setback when its shares experienced yet another bout of massive sell-offs, triggering the activation of SGX circuit breakers. Upon the commencement of trading on 12 May 2017, shareholders of Noble Group ran for their lives and dumped the shares like no tomorrow. The rout resulted in the activation of circuit breaker at 9:01 am.

However, the circuit breaker was futile in stopping the carnage. Share price continued to fall by as much as 22% compared to the day before. The sell-off came fast and furious, prompting another circuit breaker at 9:54am. At the rate of declining, Noble Group was set for an explosive free fall.

The crisis in confidence came about as the commodity trader issued a profit guidance of a loss of USD130 million loss for Q1FY17. This incurred the wrath of shareholders and ignited the meltdown of Noble Group shares.

The circuit breaker system was introduced by SGX only in 2014. Following the plunge in penny stocks of Blumont Group, Asiasons Capital and LionGold, SGX saw the need to introduce circuit breakers. According to SGX, “the circuit breaker is activated when an incoming order could potentially match an existing order in the order book at a price outside the circuit breaker price bands.