Asked on 18 Dec 2019
Discuss anything about share price, dividends, yield, ratios, fundamentals, technical analysis and if you would buy or sell this stock. Do take note that the answers given by our members are just your opinions, so please do your own due diligence before making an investment.
Agree for Straits trading its property division is a real GEM. It has stakes with ARA in property funds who are making double digit growths. These funds are private which us normal investors cant buy
In addition, being a reit manager with ARA and investing in SUntec REIT, ARA book value has been growing. ARA itself has not revalued the freehold land it owns in Singapore unlike many property counters. This itself is a possible increase to the book value. This is also why Straits Trading has been doing a consistent sharebuyback on its own shares despite trading close to current book value.Because they themselves know they can revalue their own assets to a higher value without fail
Jonathan Chia Guangrong, Fund Manager at JCG Fund
Top Contributor (Dec)
Answered on 23 Dec 2019
Had a brief look at the company earlier. Quite interesting in that it started out as a tin smelting company and now has 3 focus areas in property, hospitality and resources. Not exactly a dividend type company, more for growth. I like that they have stakes in ARA, Suntec reit and a number of freehold japanese residential units (like saizen). May be a good time to vest as they are trading at a good discount to book.
Straits trading (STC) has two major business segments - Trading and Real Estate business in Singapore
Amongst the listed companies, STC has one of the largest portfolios of Good Class Bungalows (GCB) in Singapore. It has six GCB plots at Cable Road with a total land area of 96,219 sq ft. Four of the plots have been built on, while works have begun on the other two. STC also has another three plots of undeveloped GCB plots at Nathan Road. It also has stake in ARA which is the REIT manager of Suntec.
In recent times, the company has started to divest some of its assets at above book value indicating many of their assets are undervalued. They have also been engaging on constant share buybacks which suggests management views its stock as undervalued. Personally, I feel the company is a privatisation candidate due to its unique and large land bank.