Seng Chong Yeo presented his in-depth investment theses on Tan Chong International (Hong Kong: 693) and Willas-Array Electronics Holdings (Singapore: WAE) at Asian Investing Summit 2014.
Tan Chong International: Operates in heavy commercial and motor vehicle distribution, industrial equipment distribution, property rental and development in Asia. Attractive valuation at a P/E of 2.8x (or 6.5x excluding property revaluation gains) and P/B of 0.6x (ROE is 23% or 8.5% excluding revaluation gains). Dividend yield is 3%+, paid twice a year. It has paid dividends every year since listing in 1998. No losses over listing history. Modest directors’ remuneration. Balance sheet unimpaired over listing history and has grown book value steadily over the years. No “di-worse- sification” and no dilutive share issues. Insider ownership is 75%.
Willas-Array Electronics Holdings: Trades electronic components in Greater China. Attractive valuation at a P/E of 6.9x and P/B of 0.6x (ROE is 8.5%). Dividend yield is 7%+, paid every year since listing except in 2009. It has paid dividends every year since listing in 1998. No losses over listing history. Balance sheet condition reasonably maintained over listing history and grew book value over time. Management growing the business prudently, no di-worse-sification and only one year of reported losses in entire history (listed in 2001). No dilutive issues. Insider ownership is 42%.
About the instructor:
Seng Chong Yeo has extensive experience in business and investing in Asia. Before founding Yeoman Capital Management in 1999, he served in top management of Centrepoint Properties (Fraser & Neave), Metro China Holdings (Metro Holdings Ltd) and Singapore Technologies Industrial Corp Ltd (Sembcorp Industries Ltd), during which he evaluated and executed corporate investments in Singapore and China. Previously, he was Assistant Commercial Representative in Singapore’s diplomatic mission in Beijing, during which he interacted with numerous Singapore, Chinese and foreign companies and government ministries in order to facilitate business and trade. Seng Chong has a Bachelor of Engineering (Civil) from McGill University, Canada (1975) and a Postgraduate PED Diploma from the IMD, Switzerland (1993).
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