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My 18 points guide to Successfully compounding your money in Stocks

11 Lessons From Peter Lynch

Capital Expenditure

Benjamin Graham's 113 Wise Words

Philip Fisher's Wise Words

The Ultimate Hold-versus-Sell Test

Some thoughts on Analysing Stocks (KISS)

Margin of Safety Concept: Stocks should be bought like groceries, not like perfume

KLCC at a glance

KLCCP to list stapled REIT by May

KLCC Property Holdings Bhd

KLCC Property - Return on Retained Earnings

KLCCP

Market Watch

A quick look at KLCC Property (24.5.2010)

Govt said planning compulsory acquisition of land

Largest prime property owner in KLCC

Keep INVESTING Simple and Safe (KISS) ****Investment Philosophy, Strategy and various Valuation Methods**** The same forces that bring risk into investing in the stock market also make possible the large gains many investors enjoy. It’s true that the fluctuations in the market make for losses as well as gains but if you have a proven strategy and stick with it over the long term you will be a winner!****Warren Buffett: Rule No. 1 - Never lose money. Rule No. 2 - Never forget Rule No. 1.

Showing posts with label klccp. Show all posts

KUALA LUMPUR (April 9, 2013): KLCC Property Holdings Bhd (KLCCP), which is expected to list its stapled real estate investment trust (REIT) by early May this year, is in the process of securing an anchor tenant for its latest development in the Kuala Lumpur City Centre (KLCC) area, said its group CEO Hashim Wahir.

"We are not a speculative developer. What we're working on now is to secure the anchor tenant and once it is secured, then we will start planning (for the development). Our target has always been the multinationals because we would like to enhance the precinct by having a mix of tenants," he told reporters after its EGM yesterday.

Hashim said the 0.6ha vacant land in front of Mandarin Oriental in Kuala Lumpur, known as Lot D1, could possibly be an office building with retail component but the building plans will only be confirmed once it has secured the anchor tenant.

"It can be equivalent to Menara 3 Petronas, with one million sq ft of gross floor area," he said, adding that it is in talks with potential anchor tenants but declined to comment on when it expects to finalise talks.

At yesterday's meeting, shareholders approved KLCCP's proposal to create Malaysia's first syariah-compliant stapled REIT in Malaysia, including the injection of Petronas Twin Towers, Menara 3 Petronas and Menara ExxonMobil into the REIT vehicle, KLCC REIT.

Hashim said KLCCP will retain the remaining assets which are Dayabumi Complex, Suria KLCC and Mandarin Oriental, as well as the management services namely KLCC REIT Management Sdn Bhd which will be formed under KLCCP as the manager of the REIT.

"We have a three-pronged growth strategy. We have retained Dayabumi Complex, which has quite a significant redevelopment potential. That's why we're not injecting it into the REIT yet.

"We also have Lot D1, which has a significant development potential," he said.

"Once the assets are stable, we can inject it into the REIT. Of course, we have the normal growth as mentioned, our tenancy will have rental increases and under this arrangement, we also have the first right of refusal on future assets belonging to KLCC (Holdings) Sdn Bhd, which is the ultimate shareholders of KLCCP Stapled Group before Petroliam Nasional Bhd (Petronas)," he added.

In November last year, KLCCP announced that it had signed 15-year triple net lease agreement with Petronas in regard to the Petronas Twin Towers effective Oct 1, 2012. During the first three years, rental would be RM29.1 million per month.

At the same time, its wholly-owned subsidiary Arena Merdu Sdn Bhd also signed a 15-year triple net lease agreement for Menara 3 Petronas, where rental for the first three years would be RM6.1 million per month.

Hashim said the rental rates will be reviewed every three years and the increase in rental rates would be 3% per year, compounded every three years. For its other properties, the leases are between three and five years and will be reviewed based on the market.

On acquiring new assets, he said: "We are focusing on developing what we have in our portfolio but any opportunities that come by that meets the profile of our investment, adds to the value creation of our shareholders and REIT unit holders in future, it will be considered."

Meanwhile, KLCCP director Datuk Manharlal Ratilal said the KLCCP Stapled Group will become one of the largest property groups in Asia, with a RM12 billion market capitalisation if the restructuring exercise and listing proceed as planned.

"The three assets (Petronas Twin Towers, Menara 3 Petronas and Menara ExxonMobil) are worth about RM15 billion. The group's debt is around RM2.3 billion and the balance is the market capitalisation," he said.

KLCCP Stapled Group intends to distribute 95% of the overall distributable income to unit holders for 2013 and 2014. The REIT will be the largest in Malaysia, almost three times bigger than Sunway REIT.

http://www.thesundaily.my/news/656556

KLCCP			Period (Yrs)	6
	Dec-05	Dec-11	Change	CAGR
	millions	millions
Equity	2268.48	6461.07	184.82%	19.06%
LT Assets	5725.37	13203.98	130.62%	14.94%
Current Assets	638.39	775.12	21.42%	3.29%
LT Liabilities	2635.2	3522.2	33.66%	4.95%
Current Liabilities	384.18	305.74	-20.42%	-3.73%

Sales	598.02	745.89	24.73%	3.75%
Earnings	114.44	657.7	474.71%	33.84%
Interest expense	165.12	87.58	-46.96%	-10.03%

D/E	1.19	0.37
ROA	1.80%	4.70%
ROE	5.04%	10.18%

Number of shares (m)	934.07	934.07	0.00%
Market cap	1882.2	3231.9	71.71%	9.43%

P/E	16.45	4.91
Earnings Yield	6.08%	20.35%
P/BV	0.83	0.50

Stock Performance Chart for KLCC Property Holdings Bhd

KLCC Property

Year		DPS		EPS		Retained EPS
2002
2003		0		12.9		12.9
2004		6.8		14.7		7.9
2005		7.9		19		11.1
2006		8.7		19.9		11.2
2007		10.4		22.6		12.2
2008		10.5		24		13.5
2009		11		25		14
2010		12		27.9		15.9
2011		12		30.9	P	18.9
2012

Total		79.3		196.9		117.6


From	2002	to	2011
EPS increase (sen)				30.9
DPO				40%
Return on retained earnings				26%

(Figures are in sens)

Recent Financial Results

Announcement Date	Financial Yr. End	Qtr	Period End	Revenue RM '000	Profit/Lost RM'000	EPS	Amended
18-Nov-11	31-Dec-11	Other	30-Sep-11	244,825	113,588	7.60	-
23-Aug-11	31-Dec-11	Other	30-Jun-11	240,295	110,351	7.27	-
19-May-11	31-Mar-11	4	31-Mar-11	228,843	258,196	17.81	-
25-Feb-11	31-Mar-11	3	31-Dec-10	237,437	109,006	7.26	-

Share Price Performance

	High		Low
Prices 1 Month	3.130	(31-Oct-11)	3.000	(08-Nov-11)
Prices 3 Months	3.380	(02-Sep-11)	2.870	(26-Sep-11)
Prices 12 Months	3.580	(02-Dec-10)	2.870	(26-Sep-11)
Volume 12 Months	60,601	(21-Apr-11)	2	(20-Sep-11)

A quick look at KLCC Property (24.5.2010)
http://spreadsheets.google.com/pub?key=tNyYnPuP_011FQrdQxNx_AQ&output=html

Govt said planning compulsory acquisition of land
By Vasantha Ganesan
Published: 2009/12/22

The government plans to compulsorily buy a piece of land measuring 0.38ha on Jalan Tun Razak, Kuala Lumpur, from property developer IGB Corp Bhd (1597).

The land is near Megan Phileo Promenade and a stone's throw from the Petronas Twin Towers.

Should the government pay the prevailing price of around RM1,200 per sq ft for the piece of land, the land may be sold for some RM40 million, a source said.

It is understood that the government may build a fire station on that location.

"IGB has already received a development order to build 166 units of high-end service apartments with 200,000 sq ft of net saleable area," a source told Business Times.

The source added that IGB hopes to get at least RM1,200 per sq ft, given that land prices in vicinity of the Kuala Lumpur City Centre ranges from RM1,900 to RM2,200 per sq ft.

Should IGB be paid RM1,200 per sq ft, it may get some RM40 million from the government.

"The project is in the pipeline, but it has not been launched yet," another source said.

Citigroup in a research report dated December 16 said that the book cost for the land is RM6.4 million or RM156 per sq ft.

"Typically, compulsory acquisition is done at market price (but what is the market price is also subjective) ... In the property market report, the last transaction in the KLCC area (off Jalan Tun Razak) was close to RM1,500 per sq ft," the report said.

It added that should the land be sold at RM1,200 per sq ft, IGB has a potential after tax-gain of RM32 million.

http://www.btimes.com.my/Current_News/BTIMES/articles/igbforce/Article/index_html

Largest prime property owner in KLCC
Tags: Brokers Call | HLG Research | KLCC Property Bhd

Written by Financial Daily
Monday, 16 November 2009 11:09

KLCC Property Bhd
(Nov 13, RM3.29)
Hold at RM3.39: We recently visited KLCC Property (KLCCP) and initiate coverage with a hold as its share price is in line with our RNAV-derived (revised net asset value) price target of RM3.16. Earnings catalyst will come from Lot C and Lot D1 developments, but these will be long-dated, and earnings from the hotel segment are expected to be flat until 2013.

We like KLCCP for its earnings stability and visibility. While geographical concentration is high with 88% of net lettable area (NLA) situated within the KLCC area, rental income base is diversified. Over the last three years, KLCCP’s investment PROPERTIES [] have on average enjoyed capital appreciation of 22% per year, which in turn translates to scope for rental revisions. KLCCP also has a 75% stake in 5-star hotel Mandarin Oriental KL.

KLCCP’s prime assets provide a strong tenants base; blue-chip tenants include Petroliam Nasional Bhd (Petronas), ExxonMobil, Tanjong City Centre Property Management Sdn Bhd, Parkson, Isetan and Cold Storage. These quality tenants are expected to be prompt in payments and maintain a long-term presence in their current locations, while rental revision agreements will ensure sustained growth in rental income.

KLCCP’s investment properties have varying rental rates, with the iconic Petronas Twin Towers fetching the highest rental rates for office space (fixed at RM9.50 psf under the head lease agreement with Petronas). Rental revisions typically occur every three years, allowing sustainable income growth over the long term.

Crucially, KLCCP has been able to secure long-dated lease agreements with key tenants such as Petronas (15 years), Isetan (24 years), ExxonMobil (12 years) and Tanjong Group (15 years). Also, Menara ExxonMobil’s rental rate was previously below the market rate at RM5.25psf but has now been revised to RM7.45psf.

KLCCP enjoys not only stability of rental income, but also upside from capital appreciation of its properties. With more than 100 acres of land and 5.8 million sq ft of NLA in the super-prime KLCC area, KLCCP is well-poised to benefit from rising commercial property valuations and rentals in the heart of KL.

RCULS (redeemable convertible unsecured loan stock), however, is a complicated issue for the company and minority shareholders. KLCCP has issued RM714 million of RCULS to KLCCH, which if converted could lead to a heavy 38% earnings per share dilution. The conversion would also likely trigger a general offer which it wishes to avoid. Full conversion is mandatory on the 10th anniversary in 2014/2015. However, the RCULS provides cheap source of financing for KLCCP (1% interest per annum). Management has until 2014 to come up with a solution that balances the interests of the various parties involved. — HLG Research, Nov 13

This article appeared in The Edge Financial Daily, November 16, 2009.

Be a good stock picker.
Think as a business owner.
Always look at value rather than the price. Do the homework.
Buy and hold is alright for selected stocks.
Compounding is your friend, get this to work its magic.
Mr. Market is there to be taken advantage of. Do not be the sucker instead. BFS;STS.
Always buy a lot when the price is low.
Never buy when the stock is overpriced.
It is alright to buy when the selected stock is at a fair price.
Phasing in or dollar cost averaging is safe for such stocks during a downtrend, unless the price is still obviously too high.
Do not time the market for such or any stocks.
By keeping to the above strategy, the returns will be delivered through the growth of the company's business.
So, when do you sell the stock? Almost never, as long as the fundamentals remain sound and the future prospects intact.
The downside risk is protected through only buying when the price is low or fairly priced.
Tactical dynamic asset allocation or rebalancing based on valuation can be employed but this sounds easier than is practical, except in extreme market situations.
Sell urgently when the company business fundamental has deteriorated irreversibly.
You may also wish to sell should the growth of the company has obviously slowed and you can reinvest into another company with greater growth potential of similar quality. However, unlike point 16, you can do so leisurely.
In conclusion, a critical key to successful investing is in your stock picking ability.

http://myinvestingnotes.blogspot.com/2012/07/my-18-points-guide-to-successfully.html

Peter Lynch taught me:

1. Behind every stock is a company. Find out what it’s doing.
2. Never invest in any idea you can’t illustrate with a crayon.
3. Over the short term, there may be no correlation between the success of a company’s operations and the success of its stock. Over the long term, there’s a 100% correlation.
4. Buying stocks without studying the companies is the same as playing poker – and never looking at your cards.
5. Time is on your side when you own shares of superior companies.
6. Owning stock is like having children. Don’t get involved with more than you can handle.
7. When the insiders are buying, it’s a good sign.
8. Unless you’re a short seller, it never pays to be pessimistic.
9. A stock market decline is as predictable as a January blizzard in Colorado. If you’re prepared, it can’t hurt you.
10. Everyone has the brainpower to make money in stocks. Not everyone has the stomach.
11. Nobody can predict interest rates, the future direction of the economy, or the stock market. Dismiss all such forecasts and concentrate on what’s actually happening to the companies in which you’ve invested.

Lynch’s advice had a profound effect on my stock market approach. He taught me that investment success isn’t the result of developing the right macro-economic view or deciding when to jump in or out of the market. Success is about researching companies to identify those that are likely to report positive surprises.

A great company with a Durable Competitive Advantage will have a ratio of Capital Expenditures to Net Income of less than 25%. Less is better.

Capital Expenditures are expenses on:
- fixed assets such as equipment, property, or industrial buildings
- fixing problems with an asset
- preparing an asset to be used in business
- restoring property
- starting new businesses

A good company will have a ratio of Capital Expenditures to Net Income of less than 50%.

A great company with a Durable Competitive Advantage will have a ratio of less than 25%.

Less is better.

The true investor scarcely ever is forced to sell his shares, and at all times he is free to disregard the current price quotation. He need pay attention to it and act upon it only to the extent that it suits his book, and no more. Thus the investor who permits himself to be stampeded or unduly worried by unjustified market declines in his holdings is perversely transforming his basic advantage into a basic disadvantage. That man would be better off if his stocks had no market quotation at all, for he would then be spared the mental anguish caused him by other persons' mistakes of judgement."

"The refusal to sell at a loss, while completely natural and normal, is probably one of the most dangerous in which we can indulge ourselves in the entire investment process.

More money has probably been lost by investors holding a stock they really did not want until they could 'at least come out even' than from any other single reason. If to these actual losses are added the profits that might have been made through the proper reinvestment of these funds if such reinvestment had been made when the mistake was first realized, the cost of self-indulgence becomes truly tremendous."

(Common Stocks and Uncommon Profits)

Here is the overriding primary test, followed by observations on why it is so critically important:

Knowing all that you now know and expect about the company and its stock (not what you originally believed or hoped at time of purchase), and assuming that you had available capital, and assuming that it would not cause a portfolio imbalance to do so, would you buy this stock today, at today's price?

No equivocation. Yes or no?

Answers such as maybe or probably are not acceptable since they are ways of dodging the issue. No investor probably buys a stock; they either place an order or do not.

Here is the implication of your answer to that critical test: if you did not answer with a clear affirmative, you should sell; only if you said a strong yes, are you justified to hold.

Ideally a stock you plan to purchase should have all of the following charateristics:

• A rising trend of earnings dividends and book value per share.
• A balance sheet with less debt than other companies in its particular industry.
• A P/E ratio no higher than average.
• A dividend yield that suits your particular needs.
• A below-average dividend pay-out ratio.
• A history of earnings and dividends not pockmarked by erratic ups and downs.
• Companies whose ROE is 15 or better.
• A ratio of price to cash flow (P/CF) that is not too high when compared to other stocks in the same industry.

DPO ratio (historical)

Dividend Yield range

Capital changes

The high CAGR in the early years of the investing period, due to buying at a discount, tended to decline and approach that of the intrinsic EPS GR of the companies over a longer investment time-frame.

Chapter 20 - “Margin of Safety” as the Central Concept of Investment

A single quote by Graham on page 516 struck me:

Observation over many years has taught us that the chief losses to investors come from the purchase of low-quality securities at times of favorable business conditions.

Basically, Graham is saying that most stock investors lose money because they invest in companies that seem good at a particular point in time, but are lacking the fundamentals of a long-lasting stable company.

This seems obvious on the surface, but it’s actually a great argument for thinking more carefully about your individual stock investments. If most of your losses come from buying companies that seem healthy but really aren’t, isn’t that a profound argument for carefully studying any company you might invest in?