Latest Holding of My Portfolio ~ November 2009
Abterra
Biosensors
China Zaino
Oceanus
Qianhu
Yongnam
Asia Enterprise
Midas
Raffles Education
Monday, 30 November 2009
Wednesday, 25 November 2009
Tuesday, 17 November 2009
Thursday, 12 November 2009
Yongnam Q3 Results
Yongnam Holdings, the structural steel contractor and specialist civil engineering solutions provider, today reported a 68.2% surge in profit after tax to $11.2 million in the three months ended September 30, 2009 (3QFY2009), from $6.7 million recorded in the previous corresponding period (3QFY2008). The stronger bottomline was achieved despite a 14.2% decline in the group’s topline from $96.3 million in 3QFY2008 to $82.6 million in 3QFY2009.
On a cumulative basis, the group recorded increases in both its top and bottomlines. Profit after tax jumped 58.7% from $20.2 million in the nine months ended September 30, 2008 (9MFY2008) to $32.0 million in the nine months ended September 30, 2009 (9MFY2009). Revenue increased 15.6% from $230.0 million in 9MFY2008 to $265.8 million in 9MFY2009, largely due to the many ongoing mega infrastructural projects the group is working on.
Yongnam says Structural Steelworks maintained its position as the key contributor to the group’s total revenue, albeit a contraction in revenue for this quarter. Revenue for this division fell 17.7% from $67.4 million in 3QFY2008 to $55.5 million in 3QFY2009, as the increased activities at the Marina Bay Sands Integrated Resort were insufficient to offset the substantial completion of the Dubai Metro Rail and the New Delhi Airport projects. This division contributed 67.2% of the group’s total revenue in 3QFY2009.
The group’s Specialist Civil Engineering recorded a marginal 6.0% decrease in revenue from $28.8 million in 3QFY2008 to $27 million in 3QFY2009. This was mainly due to the substantial completion of the MBS IR projects, offset by the commencement of works at the Marina Coastal Expressway (MCE) C485 project – the group’s single largest contract-to-date valued at $185.5 million. The remaining 32.8% of the group’s total revenue in 3QFY2009 was derived from this division.
As at September 30, 2009, Yongnam says its group’s order book stood at $540 million, a record- breaking figure surpassing the $517 million achieved in end March 2009. Supported by a strong order book, it is optimistic that it will continue to perform well in the next 12 months.
Wednesday, 11 November 2009
Tuesday, 10 November 2009
Thursday, 5 November 2009
Tuesday, 3 November 2009
Sunday, 1 November 2009
End of October Share Portfolio Review
Latest Holding of My Portfolio ~ October 2009
Abterra
Biosensors
China Zaino
Hongguo
Oceanus
Qianhu
Yongnam
Asia Enterprise
Midas
Raffles Education
Abterra
Biosensors
China Zaino
Hongguo
Oceanus
Qianhu
Yongnam
Asia Enterprise
Midas
Raffles Education
Monday, 19 October 2009
Thursday, 15 October 2009
Thursday, 1 October 2009
End of September Share Portfolio Review
Latest Holding of My Portfolio ~ September 2009
Abterra
Biosensors
China Zaino
Hongguo
Oceanus
Qianhu
Yongnam
Asia Enterprise
Midas
Raffles Education
Remark: No changes from last month
Abterra
Biosensors
China Zaino
Hongguo
Oceanus
Qianhu
Yongnam
Asia Enterprise
Midas
Raffles Education
Remark: No changes from last month
Monday, 28 September 2009
Saturday, 26 September 2009
Friday, 25 September 2009
Tuesday, 22 September 2009
Wednesday, 2 September 2009
China's growth - economic or accounting miracle?
Courtesy of Business Times Hock Lock Siew
Published September 1, 2009
By R SIVANITHY
BY now, most investors would be familiar with the China growth story - possibly 10 per cent GDP growth which has powered the country's stock markets' rise of more than 80 per cent this year alone. Even though there has been the occasional warning about a speculative stock market bubble, there is a smug belief that because this year is the 60th anniversary of the founding of the People's Republic of China, an image-obsessed government keen to cement the country's reputation as the next big economic powerhouse will do its utmost to ensure the party carries on - pretty much along the lines of the US, where the Treasury and Federal Reserve have pumped trillions into the system to keep Wall Street afloat and to keep up the appearance of a recovery.
This much is the conventional wisdom with regard to China - buy because you cannot lose, especially if the government is on your side. But conventional wisdom can always be challenged and for those who feel inclined to do a bit of probing, there's plenty to ponder.
Take the 8 per cent second-quarter growth which grabbed most of the headlines. Less conspicuous was that exports in June actually declined by 21.2 per cent year-on-year while first-half exports fell 20 per cent. These lesser-known figures beg the question: where did the growth come from?
The answer is, of course, the government. Late last year, a stimulus package equal to 14 per cent of GDP was launched to stimulate consumer demand and judging by the figures so far, it looks like it's working.
However, according to American Enterprise Institute visiting scholar John Makin, creative accounting plays a big part in creating the impression of robust growth.
In a recent article titled 'China: Bogus Boom?' (see http://www.aei.org/outlook/ 100061), Dr Makin wrote that the target 8 per cent annual growth figure will surely be achieved because the country's economic statistics are based on recorded production activity rather than expenditure growth, the latter defined as the sum of consumption, investment, government spending and net exports.
'The US stimulus package, for example, attempts to boost GDP by undertaking measures that will boost consumption, investment and government spending. China, however, decrees mea-sures that will generate recorded increases in production spending,' Dr Makin wrote.
'Once China had announced the 8 per cent growth target, it began to disburse funds directed at sharp increases in public works spending. It is important to understand that the disbursal of funds is recorded as GDP growth. So the government can easily control the pace of growth by the pace at which it releases funds that have already been allocated in the stimulus package to the creation of higher growth or production numbers,' he added.
'The same convention, counting production and shipments as de facto outlays by end-users, is employed with respect to retail sales data in China.
'Shipments to retailers are counted as retail sales on the apparent assumption that ultimately all goods shipped will be sold at some point in the future. China's nominal retail sales have been rising at a rate of around 15 per cent year-over-year over the first half of 2009 because that is the rate at which shipments to retailers have been occurring. There is very little data available to measure actual sales by recipients of the shipments to ultimate consumers.'
Quite correctly, Dr Makin questions the true health of the China economy and warns of inflationary pressure brought on by loose monetary policy.
Possibly the first - and only - broker to cast some doubt on the China 'miracle' story is DBS which, in its August Markets Update last week, warned against over-reliance on government support that it thinks can be withdrawn suddenly anytime over the next 12 months.
DBS also referred to the China market's high valuations, which it describes as 'unsustainable'. DBS is not wrong - according to Bloomberg's analytics, the Shanghai Composite sells for 31 times earnings and is supported by a paltry 1.4 per cent dividend yield, while the Shenzhen Composite's figures are much worse - 67 times earnings and 0.7 per cent dividend yield. Neither set of figures can be described as 'cheap', so the conclusion has to be that the market is expensive and is running on liquidity, much of which has been provided by the government. Such must have been the conclusion reached by most investors who yesterday sold off China stocks, dragging the major indices 7 per cent lower.
Given the high dependence of the local market on daily, minute-by-minute shifts in the Hang Seng Index, and because of the latter's reliance on events in China, local investors would thus do well to stay nimble and not place too much faith or money on the China growth story because the economic miracle could well be founded on an accounting miracle instead.
Published September 1, 2009
By R SIVANITHY
BY now, most investors would be familiar with the China growth story - possibly 10 per cent GDP growth which has powered the country's stock markets' rise of more than 80 per cent this year alone. Even though there has been the occasional warning about a speculative stock market bubble, there is a smug belief that because this year is the 60th anniversary of the founding of the People's Republic of China, an image-obsessed government keen to cement the country's reputation as the next big economic powerhouse will do its utmost to ensure the party carries on - pretty much along the lines of the US, where the Treasury and Federal Reserve have pumped trillions into the system to keep Wall Street afloat and to keep up the appearance of a recovery.
This much is the conventional wisdom with regard to China - buy because you cannot lose, especially if the government is on your side. But conventional wisdom can always be challenged and for those who feel inclined to do a bit of probing, there's plenty to ponder.
Take the 8 per cent second-quarter growth which grabbed most of the headlines. Less conspicuous was that exports in June actually declined by 21.2 per cent year-on-year while first-half exports fell 20 per cent. These lesser-known figures beg the question: where did the growth come from?
The answer is, of course, the government. Late last year, a stimulus package equal to 14 per cent of GDP was launched to stimulate consumer demand and judging by the figures so far, it looks like it's working.
However, according to American Enterprise Institute visiting scholar John Makin, creative accounting plays a big part in creating the impression of robust growth.
In a recent article titled 'China: Bogus Boom?' (see http://www.aei.org/outlook/ 100061), Dr Makin wrote that the target 8 per cent annual growth figure will surely be achieved because the country's economic statistics are based on recorded production activity rather than expenditure growth, the latter defined as the sum of consumption, investment, government spending and net exports.
'The US stimulus package, for example, attempts to boost GDP by undertaking measures that will boost consumption, investment and government spending. China, however, decrees mea-sures that will generate recorded increases in production spending,' Dr Makin wrote.
'Once China had announced the 8 per cent growth target, it began to disburse funds directed at sharp increases in public works spending. It is important to understand that the disbursal of funds is recorded as GDP growth. So the government can easily control the pace of growth by the pace at which it releases funds that have already been allocated in the stimulus package to the creation of higher growth or production numbers,' he added.
'The same convention, counting production and shipments as de facto outlays by end-users, is employed with respect to retail sales data in China.
'Shipments to retailers are counted as retail sales on the apparent assumption that ultimately all goods shipped will be sold at some point in the future. China's nominal retail sales have been rising at a rate of around 15 per cent year-over-year over the first half of 2009 because that is the rate at which shipments to retailers have been occurring. There is very little data available to measure actual sales by recipients of the shipments to ultimate consumers.'
Quite correctly, Dr Makin questions the true health of the China economy and warns of inflationary pressure brought on by loose monetary policy.
Possibly the first - and only - broker to cast some doubt on the China 'miracle' story is DBS which, in its August Markets Update last week, warned against over-reliance on government support that it thinks can be withdrawn suddenly anytime over the next 12 months.
DBS also referred to the China market's high valuations, which it describes as 'unsustainable'. DBS is not wrong - according to Bloomberg's analytics, the Shanghai Composite sells for 31 times earnings and is supported by a paltry 1.4 per cent dividend yield, while the Shenzhen Composite's figures are much worse - 67 times earnings and 0.7 per cent dividend yield. Neither set of figures can be described as 'cheap', so the conclusion has to be that the market is expensive and is running on liquidity, much of which has been provided by the government. Such must have been the conclusion reached by most investors who yesterday sold off China stocks, dragging the major indices 7 per cent lower.
Given the high dependence of the local market on daily, minute-by-minute shifts in the Hang Seng Index, and because of the latter's reliance on events in China, local investors would thus do well to stay nimble and not place too much faith or money on the China growth story because the economic miracle could well be founded on an accounting miracle instead.
Monday, 31 August 2009
End of August 2009 Share Portfolio Review
Latest Holding of My Portfolio ~ August 2009
Abterra
Biosensors
China Zaino
Hongguo
Oceanus
Qianhu
Yongnam
Asia Enterprise
Midas
Raffles Education
Abterra
Biosensors
China Zaino
Hongguo
Oceanus
Qianhu
Yongnam
Asia Enterprise
Midas
Raffles Education
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