SRS Portfolio - 5 Sep 2021 (OTS Holdings / Suntec)

OTS Holdings - disappointing full year results

OTS Holdings announced the financial results for the full year ended 30 June 2021.

The results were a downer considering that they had presented very rosy first half (year-on-year) results in the prospectus only for investors to realise that the profit for 2H 2021 was a mere $112,000.  The full year profit was down 15.8% to $2.989m

If the IPO expenses of $0.9m were excluded, the full year profit would have grown by 13.9% to $4.05m. 

The Company announced a dividend of 0.7 cents per share, representing around 50% of the Group's net profit for FY 2021. Based on my shareholding of 100,000 shares, that will translate into a dividend of $700 or a yield of 2.4% based on the last traded share price of 29 cents. The NAV per share is 13.85 cents.

SAC Capital initiates with Buy and a target price of $0.40

SAC Capital initiates with a buy and you can find the report here. (Note that SAC was the placement agent)

According to SAC, the growth drivers are greater market penetration in Malaysia, Philippines and Indonesia. The target price of $0.40 is DCF derived. The positives about this Company is that it is debt free and cash flow generative in a recession resilient business. 

I have included the projections for future reference here. 

Suntec paid quarterly distributions of 2.109 cents per unit for the period from 1 April 2021 to 30 June 2021 on 27 Aug 2021

The SRS account received a dividend of $738 for Q2 from Suntec REIT. You can find a more comprehensive business update from Suntec REIT from the presentation at the Citi-SGX REITAS Forum dated 26 August 2021 here and the outlook for Singapore Office seemed positive.

SRS portfolio 

No update to my SRS portfolio as my WFH arrangement came to an end as well. The cash balance increased to $234,958 as of 5 Sep 2021. 

Let's see if there are any opportunities to deploy in Sep and we have wasted 1 year 9 months on this pandemic. 

Looking at the chart below - it's not going to drop anytime soon! My only complain is that if the government wants to call it endemic, let's all return to normalcy and stop reporting the daily numbers and open up the offices and hawkers since we are not going to do anything about it anyway. Better still, let's emulate Europe and 😷 off ! 😜