Tat Hong, Neratelecommunications, Popular (End of year buys)

As 2013 ended and after receiving my end of year bonuses, I guess it's quite unusual for a lady like myself to spend on undervalued shares than on branded goods as a form of reward. I find a truck lot of satisfaction knowing I'm putting my money to work & that I'm a tad bit closer to achieving my dream of traveling the world. I never fail to smile whenever a close friend of mine drops me a text giving positive feedback about my blog. It re-assures me of what I'm doing though somewhat unconventional and a little nerdy. In any case, I hope that my blog inspires and motivates my readers to also pursue their own dream no matter how far off it may appear to be.

Added positions to Tat Hong, Neratelecommunications and Popular. 

Tat Hong is a supplier of cranes and heavy equipment and boasts to be one of the largest crawler crane company in the world, supplying cranes and heavy equipment to various industries. Operations in our own homeland and countries such as Malaysia, Thailand, Indonesia, Hong Kong, China, Vietnam, Dubai and Australia. As the world progresses onwards, there will always be a need for more buildings and also upgrading works to be done. No doubt that it might be cyclical but demand for cranes and heavy machineries will always be there.

Neratelecommunications is a solutions provider with the technological expertise. Range of products and services include satellite communications, microwave radio transmission, to information technology, networking infrastructure and high-end electronics contract manufacturing. Its headquarter is in Singapore and they have markets in Malaysia, Thailand, Indonesia, Philippines, Vietnam, Brunei, Laos, Cambodia, Myanmar, Taiwan and Korea. In a much simpler way, every time you pay something with NETS or Credit Card, that whole network of electronic system pretty much involves Neratel so I guess you can say it's an essential business unless of course one day a better & more cost-competitive company takes over and Neratel is doomed. Neratel has been known to have a clean balance sheet and financing almost zero debt.

Popular is probably a household name that everyone of us has at least heard of. It retails and distributes books, stationery, CD-ROMs, audio products, and magazines; and operates as a publisher, wholesaler, and dealer of books which most of us are familiar with. However, they are also involved in software development, property development, and real estate investment activities which few of us are unaware of. Operations in countries such as Canada, China, HK, Taiwan and Malaysia. I believe that despite the rise of e-books & how the world is progressing towards a paperless globe, in the next decade or two, I still think that physical books are important especially educational ones and Singapore will definitely continue to put a huge stress on education and personal upgrading.That aside, I guess it's also good to know that the company has business in the real estate industry (of which I'm bias towards).

If you quickly make an assessment on these 3 stocks, you can probably come up with a few common traits among these 3 and why I have picked them over the hundred over counters in SGX. I believe that these businesses are essential and I can foresee them thriving in at least the next decade and hopefully beyond. They pay dividends to their shareholders though their yield arent as high as REITs (except for Neratel) but I do not buy them for dividends purposes but instead, mainly for capital price appreciation. I bought all 3 of them on weakness, hence there'll be more room for price appreciation in future. Tat Hong yields about 3-4%, Neratel >8% and Popular about 5-6%. If ever any of these stocks are overvalued, I will be divesting to earn the positive gains & move on to other stocks. Also, I'm staying away from REITs for now as I'm sure price correction will be done as the Fed continues to taper more as the US economy slowly throttle onwards out of their sluggishness. As of right now, we can see that REITs are slowly falling out of favour with most investors as investors are moving away from dividend play which is a good thing for me in the near future as it means I can accumulate my REITs at a more valuable price.

Yongnam holdings limited (Evaluation & Marina One Subcontract)

Yongnam is a well-established structural steel contractor and specialist civil engineering solutions provider with operations and projects in Singapore, Malaysia, Thailand, Indonesia, Hong Kong and Middle East.

Last Friday I managed to snap up some lots of Yongnam at my target price of $0.240 after a few failed attempts the previous days. I bought on weakness after Yongnam reported their disappointing third-quarter results. Yongnam reported an increased in revenue but their gross profit was down 55.2% due to cost overrun of 3 existing projects and a one time off disposal of fixed assets (pipe piles) which set them back $8.1mil. In short, they suffered a $3.4mil loss which put them in the red. However, Yongnam's gearing remained healthy at 0.48 times. Its cash and cash equivalents also increased from S$13.51mil to S$16.33mil in the corresponding quarter last year, albeit due to lower capital expenditure and higher borrowings.

Yongnam carries a dividend yield of around 4.1%. Its NAV is about S$0.2585 so I'm happy to buy it at a discount and I'm confident its price will only pick up from here as regional infrastructural developments and projects continue to have a strong demand in 2014 and beyond. Yongnam's financial fundamentals remain sound and I feel they still have lots of room for growth and expansion hence, my decision to buy into this company.

Just yesterday, Yongnam announced that they secured a structural steel subcontract worth S$168mil at Marina One, a mixed-use development located at Marina South, Singapore’s new Central Business District. This subcontract is a record win for Yongnam bringing their order book to S$397mil. After the news was released, Yongnam share price increased by 6.25% and closed at $0.255.