Stock Market

Sabana REIT’s lesson and Wilmar’s interim dividend.

A few years ago, I blogged about lessons from my journey as an investor with Sabana REIT.

One of the things I said was:

“I remember UOB KayHian was particularly bullish in 2013 and had a target price of $1.30 for Sabana REIT. By that time, I had turned cautious although I was enjoying a distribution yield on cost of between 10.3% to 11.1%…”



See: 

History with Sabana REIT.

In a nutshell, no one cares more about our money than we do and we must always do our due diligence.

Sabana REIT is pretty generous in dishing out lessons and last year saw ESR-REIT making a low ball offer for Sabana REIT which resulted in a fight led by activist investors to scuttle the proposed deal.

I wrote a piece on why the proposed deal was a bad one for Sabana REIT.

Not only did it grossly undervalued Sabana REIT, “Sabana REIT’s investors would eventually have to help bear the cost of the mistake that was the merger of ESR-REIT and VIT.” 

See: 

Anyone who said anything to the contrary was either misinformed or malicious.




In a recent article in The Business Times, the writer’s one liner summed it up well.

“If the proposed merger of Sabana Reit and ESR-Reit last year demonstrated anything, it is that IDs cannot always be relied upon to act in the interest of unitholders.”



Source: 

The Business Times.

I am sure Sabana REIT is worth more today and will probably be worth more in the future as it continues to unlock value in its portfolio.

Of course, a rising tide will lift all boats too and Sabana REIT will be a beneficiary.




Recently, I also replied to comments from some readers on Wilmar’s declining share price.

I actually increased exposure to Wilmar, adding on weakness in its share price, averaging up.

I believe that Mr. Market is undervaluing Wilmar even at today’s price.

“Wilmar reports higher 1HFY2021 earnings on better selling prices and volumes; to pay interim dividend of 5 cents.” 

Source: 

The cyclical component of Wilmar’s business will do well just like other cyclical businesses as the economy recovers.

However, Wilmar is much more than that.




I said this in a blog about Wilmar before:

“There are not many companies in the world like Wilmar when it comes to agricultural products and their distribution. 

“Wilmar has amazing breadth and depth of operations. 

“Its distribution network is extensive, established and still growing.”

I said that investors in Wilmar must be of the patient variety and I still feel that way.

While I wait for Mr. Market to pay what is Wilmar’s true value, I am happy to be paid while waiting.

Will Mr. Market pay Wilmar’s true value and if it does happen, when?

Your guess is as good as mine, of course.




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“It may move up toward its real worth today, next week, or next year. It may trade sideways for five years and then quadruple in price. There is simply no way to know when a particular stock will appreciate, or if, in fact, it will.”

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