Monday, 5 December 2016

Dividend Knight Income Portfolio Update (Nov 2016) - All Hail President Trump!


No.
Company
No. of Shares
1.
AIMS AMP Capital REIT
30, 000
2.
DBS
2, 073
3.
Mapletree Logistics Trust
32, 498
4.
Singtel
8, 000
5.
Frasers Centrepoint Trust
15, 000
6.
OCBC
3, 040
7.
Raffles Medical Group
15, 094
8.
SATS
4, 000
9.
ParkwayLife REIT
8, 000
10.
Ascendas REIT
7, 000
11.
Keppel DC REIT
12, 800
12.
CapitaLand Mall Trust
7, 000
13.
Frasers Logistics & Industrial Trust
13, 000
14.
MGCCT
12, 000
15.
Suntec REIT
6, 000
16.
Sheng Siong
7, 000
17.
Mapletree Commercial Trust
4, 000

Dividends received in November 2016: S$1, 924.77

Total dividends received since Jan 2016: S$13, 955.23
 
Average dividends per month: S$1, 162.94
 
Average dividends per day: S$38.23
 
Total portfolio market value: S$350, 424
 
Unrealised Profits: S$39, 686


For the month of November, I have collected a total of S$1, 924.77 in dividends and distributions from my income portfolio.
  • Suntec REIT: S$152.10
  • Ascendas REIT: S$68.31
  • Frasers Centrepoint Trust: S$422.25
  • CapitaLand Mall Trust: S$194.60
  • Mapletree Commercial Trust: S$1.31
  • Parkway Life REIT: S$153
  • Mapletree Greater China Commercial Trust: S$433.20
  • Starhub: S$500

Remember I talked about being resilient in my previous portfolio update? It definitely come in handy as Donald Trump won the US presidential election. Did the global markets implode as so many experts/analysts expect? Nope! The world kept on spinning. The markets kept on rallying. I continue to collect dividends from my portfolio.

Portfolio Shuffle - Accumulating Quality Yield Assets
Divested UOB, Starhub and M1 due to a huge recent run-up in bank stocks and the near-certainty of an all-out Telco war in 2017. Holding on to my DBS and OCBC positions despite the temptation to take profits. Both banks are Asian wealth management plays with UOB lacking allure in this aspect. The private wealth business has become the jewel in DBS's crown. Despite a challenging 2016, it is the only unit to register double-digit growth in the bank. DBS is now ranked the fifth largest private bank in Asia, up from ninth spot in 2012. Furthermore, with rising interest rates moving forward, NIM should trend higher which would lead to a rise in earnings. OCBC's life insurance business should also benefit from a rising rate environment. Lastly, I am hopeful that the worst of the O&G crisis is behind us and the NPL issue will clear up next year.

Channelled the funds into PLife REIT, MLT, MCT, FLINT and Ascendas REIT as I believed the hunger for yield-play assets will stay strong next year. We just need to focus on quality REITs that have healthy gearing, long debt maturity, low all-in debt cost and a high percentage of total borrowings hedged on fixed rates. Having strong backing from sponsors is a welcome bonus. Take PLife REIT for example. Empty shops? Worried about finding tenants to fill up the retail space? No such problem for PLife REIT. The demand for healthcare and nursing services is still growing at a rapid pace.

  • 100% committed occupancy at Mount Elizabeth, Gleneagles Hospital and Parkway East Hospital with a master lease with IHH. Furthermore, this master lease is 15+15 years since 2007 with a triple net-lease and favourable CPI+1% lease structure.
  • Solid track record of growing DPU over 8 consecutive years even during the post-2008 GFC period 
  • No refinancing needs at all in 2017.
  • All-in debt cost of 1.4% (lowest in the S-REIT sector)
  • Well-staggered debt maturity profile over the next 5 years
  • High Interest Coverage of 9 times
  • 98% of total borrowings is hedged against rising interest rates
The rest of my recent additions are meant to be quality plays on the logistics (MLT & FLINT) and business parks (MCT & Ascendas) sectors.

 
 

Moving forward, I am excited about the impending launch of Changi Terminal 4. Mainland Chinese inbound tourism into Singapore is expected to grow healthily. Hoping SATS is able to win some lucrative ground-handling and in-flight meal contracts from the airlines at the new terminal next year and maintain its dominant position in Singapore's aviation and food solutions business. SATS also has a strong balance sheet - net cash position and a stable 4-5% free cash flow yield. This will enable the management to increase future dividends if they wish to.



Everything you want is on the other side of fear
DK

11 comments:

  1. Hi DK,

    From hindsight, some of the reits were toppish in the last few months. Would you have considered selling them and buying back at lower/fairer prices or channel into cash/other stocks?

    Thanks.

    ReplyDelete
    Replies
    1. Hi,

      Even though they appeared 'toppish', they were not grossly overvalued. As long as a REIT is able to maintain and grow its DPU, I will keep it in my portfolio. However, once I spotted a drastic reversal in terms of DPU stability over one or two quarters, I will divest like what I did to my Cache logistics holding previously.

      Delete
  2. Good portfolio and strategy to acquire strong fundamental reits. More buying opportunities in Dec 16 when Yellen announced rate hike

    ReplyDelete
    Replies
    1. Hi Investminds,

      Thanks for the compliment :)

      My warchest is ready for some bargain-hunting after the Fed rate hike!

      Cheers!^^

      Delete
  3. Well done Knight. My one pre-election trade was to get some Wells Fargo, which has been on quite the upward move following the Trump win. Keep it up! What currency are you in again? Take care,

    Dan

    ReplyDelete
    Replies
    1. Hi Dan,

      The financial stocks have been on a tear post-election. Congrats!:)

      My portfolio is in Singapore dollars.


      DK

      Delete
  4. Hi DK,

    If you are expecting an intense Telco war to break out in 2017, why are you still vested in Singtel?

    ReplyDelete
    Replies
    1. Hi DW,

      Singtel generates the bulk of its revenue from overseas markets. I am also anticipating the potential of its Netlink Trust IPO next year which should present a special dividend. Furthermore, I am optimistic about SingTel's progressive expansion out of its core business such as cyber-security and cloud services.

      Delete
  5. Hi DK,
    Impressive portfolio :)

    Why do u wan to sell starhub and m1 at a loss at this point in time? Is it a good time to sell these counters now?

    ReplyDelete
    Replies
    1. Hi Alfred,

      Starhub was sold at a profit while M1 was sold at a slight loss. Unfortunately, the prices of these 2 counters probably have more room to fall as the 4th Telco should deploy a disruptive pricing strategy to grab market share asap IMO. I decided to let the dust settles first on the Telco price war before re-evaluating Starhub and M1 again.

      Delete
  6. Hi dividend knight, don't mind sharing at which price did you enter plife Reit, thanks!

    ReplyDelete