Hunting For Value

Friday, January 12, 2018

Stock Sniper's Portfolio For December 2017



Read about Stock Sniper's Portfolio HERE

 
Transactions done in Dec 17:

1. Fufeng Group

Initiated a new position in this company.

 
Fufeng is the largest manufacturer of MSG and Xanhtan Gum in the world.

The competition in the MSG market has eased since 2016 with many unprofitable small and mid sized producers exited the market after years of price competitions. With the liberalization of the corn market in the Northeast China and Inner Mongolia, Fufeng benefited from the lower input costs in 2016 and 1st half of 2017. Also, it completed the first phase of its manufacturing plant upgrades in 2016 which helped to improve the efficiency and lower its manufacturing costs. The Xanhtan gum prices also started to improve in 1st half 2017 after years of sluggishness due to low oil prices and demand.


Back by these positive factors, Fufeng reported a revenue growth of 5.1% and profit growth of 111.6% in 2016 and revenue growth of 12.7% and profit growth of 83.4% in 1st half of 2017. Note that the net profit growths were much faster as compared to the revenue growth due to improving gross profit margins as Fufeng had adopted a competitive pricing stance to consolidate its  market share leadership.

Key risks: Input cost of corn.

2. Singtel

Increased position slightly to take advantage of the price weakness after the share went ex-dividend. At this current price, it offers a dividend yield of 4.9% excluding special dividend.
(Refer to related articles HERE)
 
 
News for the rest of Portfolio companies during the month:

1. Goldpac:

(i) Goldpac announced receiving following awards:
a.  Model Enterprise for the "Mass Entrepreneurship and Innovation" and "Innovative Pilot Enterprise"
b. Enterprise for the 2017 Strategic Emerging Industries (Intelligent Manufacturing) 
 
Once again, these awards are further testimonies to Goldpac's leadership in the industry.
 
(ii) Executive Chairman, Mr Lu, purchased 1 million shares at the price of $2.10 as the share price experience much volatility in Dec 17.
 
(iii) On a side note, Gemalto, its substantial shareholder and strategic partner, accepted the buy out offer from Thales. It is not clear whether this move would have any impact on Goldpac at this juncture.
(Refer to related articles HERE)

2. Hopefluent:


Executive Chairman, Mr Fu continued to purchase more shares in Dec 17, buying a further 4,894K shares at an average price of $3.47.

For 2016, the insiders (Mr Fu and his wife, Ms Ng, both Executive Directors of the company) had recorded a total purchase of 13.3 million shares at an average price of $3.57, spending a total of HK$47.48 million.
(Refer to related articles HERE)

Overall, at the end of 2016 the portfolio is only about 50% invest. Shall keep on hunting for good value stock in 2017!

Connect @ Facebook

Read Disclaimer