Caveat Emptor

Sources http://investors.hyflux.com/newsroom/20180201_173107_600_GB8Y3Z4PUZ7L5A01.3.pdf http://investors.hyflux.com/newsroom/20180201_173107_600_GB8Y3Z4PUZ7L5A01.1.pdf https://hyfluxhomeproducts.com/ Hyflux extraordinary general meeting Hyfluxshop - good buy or goodbye? I attended the egm on 02 Feb at Hyflux innovation centre. It was my first agm/egm in my life and it was an eye opener. I have heavily researched on Hyflux, read about the water industry and even went to the YouTube channel to see its products and how the business is like on the ground and I was really impressed by it. Hyflux is in the municipal Liquid business, but ironically in a debt ridden and illiquid financial position. A part of me wanted to liquidate a portion of my ordinary shares while the other part still think it is a company with great potential. It was venturing into retail business (Hyfluxshop) that could be a potential diwosify, and now it is spinning it off and seeking shareholder approval in this

Found a very useful guide detailing the process of short selling and leverage. It is good to understand the processes and risks in a visual and easy to follow format, rather than reading through chunks of text Short Selling https://www.fidelity.com/learning-center/trading-investing/trading/about-short-selling 1) Short selling is an advanced trading approach, available to margin account holders only. A speculator believe that the stock price will fall within a short period. To increase his potential returns, he arrange to sell his security (despite not holding any) at a higher price, and when the stock price eventually decreases, he is able to buy back at a lower price to cover his deficient position. The trade can be instructed at T and settlement date at T+2.  In reality, naked short selling is too detrimental and risky and markets like Singapore, China and Hong Kong prohibits that. If you wish to short a stock, you must prove that you are able to cover that deficient position, an

Exposure 30% SG, threat of TPG 22% Australia, Australia regulatory review 48% regional, India price war Lines of business 36% mobile comm, expect to be declining especially in voice and roaming 20% data and internet, increasing profits due to change in consumer lifestyle and appetite. 18% Info comm tech, increasing business in cloud computing and software as a service 12% equipment, established distribution network of handsets, apple iPhone and google Pixar phone 3% others Growth areas Cyber training Mobile payments (Singtel dash )(network externalities) (airtel india payment bank license) (phillipines globe) Shows (Philippines, singapore,  (Hollywood, Netflix, movies) Data appetite (forced obseletion of 3G 12GB, high speed 5G data) Sports channel Cyber security (Japan, Australia, phillipines, nus Singapore) Digital marketing Internet of things Strategy Simon Israel, Chua sock koong Diversification out of stagnant mobile communications to a technology company. Key

Savings / commercial Banks Le veraged organisations that primarily earn via providing financial services, and earn via loans bid offer spread. They may provide cash management services, trade finance, investment management which leads to complexity in analysing its performance. As loans (assets) increase, increase in upfront fees which is added to equity. This increase ability to make more loans (Central Bank required reserve ratio) What to look out for 1) strong deposit base (charateristics of population as savers ) 2) Increased demand of loans (Improved business prospects) ,  and the bank making Loans back by collateral. Ability of borrowers to repay loans. Purpose and feasibility of project when making loans. 3) Buy when i/r increase and you are sure that it will lead to improvement in interest margin. Be careful of potential increase in borrowing cost (savings a/c i/r) . 4) Low overheads and low cost operator. Leading to higher profit margin. No increase in misc cost / dist

Improvements 1) Revision of electricity fees from January 2018, the government justify price increase due to increase in energy prices, may result in better profit margins / reduced losses from Tuaspring 2) Revision of water price upwards, the government justify price increase due to lack of revision of prices and need to readjust it to reflect market fundamentals. May result in better profit margin of Hyflux Operation and Maintenance business 3) Liquidation of fixed / non current assets to current assets to improve cash flow. Cash flow used partially to pay down preference shares / debt. 4) Eventual p artial divesting of Tuaspring to unlock cash flow and reduce its exposure to the energy market, which is not within its circle of competence 5) Hyflux group will refocus on its own core business (Municipal and O&M) Free scrip dividend (at no cost)of Hyfluxshop Shares as it is going to be listed eventually. Proposed Distribution being approved by Shareholders at the Ex

Value investing is a frustrating yet rewarding hobby. It is easy to understand but immensely difficult to implement. Persistance in working hard to filter out the most promising companies which might be undervalued at certain price levels. Patience to wait out the hype and resist joining the crowd and do nothing until price fall below target level. Courage to buy when prices are falling and believing in your thesis of the company. Confidence that your company will do well irregardless of market noise. The December effect touted by academics and fund managers is prevalent in us markets. Fund managers will window dress their portfolio by dumping under performing and buy the outperformers, to make themselves look like the winner when investors look at their portfolio constituents. Mere mortals cash in and sell their stocks to raise money for Christmas gift shopping and portfolio rebalancing. Regardless, there will theoretically be a mini crash of temporary under performing stocks and

Peter lynch one up on wall street Lynch stock picking methodology 1) lynch contrarian, market cyclical, bottom up (individual performance of company not economy) fundamental analysis investing i) Buy based on fundamentals like earnings rather than stock price or broker recommendations in buy/ sell decision. Don't overestimate skill and wisdom of professionals. Strong preference for undiscovered and un-monitored stocks. Usage of earnings line whereby stock price will trend towards earnings line and the importance of projecting how earnings will go. ii) Buy companies that can successfully enter new markets, generate improving earnings, and leading to improvement in share price. iii) Strong preference for buying shares within your circle of competence (everyday goods and services, work related vendors, hobbies and passion). Good to try out the products and services and visit stores, or buy companies within your circle of competence. understand the busine