Wednesday, June 24, 2020

A Speculative Story of Three Potential "Multi-Bagger" Positions

In the past recent days, I've taken three small speculative positions and have kept them relatively small as an overall percentage of the portfolio.

These are positions which I've taken without doing too much due diligence and reading too much of its fundamentals due to the nature of the companies (but yes I've weighed in the risk reward probability) and both have announced big news in the past week.


I've written an article recently about the company (Link Here) after its scandal news were splattered all across the Internet.

After 5 consecutive days of the stock dropping from $100 to $14, my itchy hands decided to buy in a little at 200 shares @ $16.7 and I added another 80 shares @ $13.2.

My average price is now at around $15.8, and I am close to 20% down.

My thesis for buying was mainly betting on the company's solvency, hoping that a white knight might come in to restart the company all over again. They had done so by removing their incumbent CEO and installing hard man Dr James Freis into the helm. They have also began talking to investment banks to start convincing them on extending the credit facility under the new management guidance though it is likely a tough fight until the forensic audit is concluded.

Nevertheless, I believe their business model remains intact and relevant and it is poor corporate governance that is dragging the whole system down.

At the moment, it doesn't appear that the selling has not abated so like many other investors out there, we are all screwed in it for now.

Singapore Edevelopment Limited (SED) and Document Security Systems INC (DSS)

This was another company which I managed to slip in to buy by joining in the crowd.

I was having my lunch at 12.55pm while browsing through the sgx website announcement (this has been my habit since I started WFH) and chanced upon the Press Release that was released during lunch time. 

Based on the news that were announced, (the previous week they came up with another press release that involves some research study with the Harvard lab house), it was announced that Impact Biomedical has achieved some further success with Equivir and 3F Biofragrance on reducing the impact of Covid-19.

You can read that Press Release link here.

I bought a small position of 150,000 shares at about 1pm-ish at market price, but only to see it shot up to over 6.9 cents by the time I get mine.

I was pretty surprised to be honest to see it close at 9.2 cents at closing, which translates into market cap of 112m after today's run.

I took the time to do further reading after that and realize that the company will host an EGM this Friday on the 26th Jun to conclude the $50m shares swap deal agreement with Document Security Systems Inc (listed in Nasdaq).

What was interesting was to find out that Impact Biomedical was a 100% owned subsidiary of SED whose CEO and largest shareholder Chan Heng Fai holds a 72% stake in the company, and he happens to also be the Chairman board and largest shareholder of DSS.

Based on the proposed term sheet and closing conditions, the intention after the deal is to give a dividend of IMPACT shares to the shareholders of DSS, with the proposed bonus being for every one DSS share held, the shareholder will be entitled to a bonus of  two IMPACT shares, following which IMPACT is expected to pursue listing in the US.

Now, DSS is currently listed in the US with a market cap of only 24m but what catches the eye is the expected valuation of Impact Biomedical should they decide to list this in the market post-deal.

Based on the Independent Valuers completed recently by Destum Partners, Impact Biomedical is currently valued at $382m which is almost 15x the current market cap of DSS on the market. Should DSS be able to list this successfully at such a valuation, it is likely that it will send DSS and SED price flying.

Because of this reason, I have also put in a small order of 1000 shares when the market opened at $8.33.

Do note though that this is a speculative timeline with a probability look of risk reward so there's a lot of variables at play which could happen.

Let's revisit how all these positions are doing in a few weeks / months time.

Thanks for reading.

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Sunday, June 21, 2020

Why You Should Still Pursue Financial Independence Even If You Love Your Job

A reader contacted me recently and we chatted a little bit in exchange about her situation.

I obtained her permission to share her story since I believe someone out there may be in a similar situation as her. As promised, I will leave out certain key information which may be deemed confidential.

About Her:

She was born in the year of rat and had gone to the same college school as I did so I figured out she is probably one year my senior. I do not know who she was and we were not acquainted in any way until we spoke recently.

She had two children, aged 7 and 4 so we have a lot of common topics to exchange and perhaps because of that I could feel it for her.

She has been retrenched involuntarily from her role recently due to the company downsizing most of its operations in South East Asia due to Covid-19. 

She worked as a Customer Happiness Manager and have been in the company for close to 7 years. 

From the way she was describing her role, it seems that she loves her job a lot, up to the point where she had to sacrifice some of her personal family time to work overtime on weekends due to the nature of her role.

Up until recently, she has never thought hard and deep about her financial security because she was alluding more towards her job security for as long as she did her role well.

She felt somewhat regretful of her situation because she never really give much thought to her own financial situation until it gets too late.

Why Do We Need To Pursue Financial Security Even Though We Love Our Jobs?

I really feel for the reader above after chatting with her.

Based on our conversations, she seemed like a really hardworking worker and a nice down to earth person who's just trying to make a living for her family.

Nothing seems wrong with her personality and attitude and she just couldn't understand why she's in a dire situation today even though she has put 100% of her energy into believing what's best for her.

After hearing it from her, I can't help but think of why in my obvious biased opinion (I've clearly been brain-washed since I pursued this path from a decade ago) everyone should pursue their own financial security even though they may find joy, value and purpose in working.

1.) Black Swan Event Can Wipe Out Companies

If there's anything that the millennials of our generation can take away from a black swan event like Covid-19, it is that there's probably no companies and no roles that are immune to the impact.

Almost every companies out there, even the strongest ones, are sending mixed signals about the outlook uncertainty of the economy in the next 1 to 2 years.

There's so many variables at play for companies to make good reasonable projection forecast that we can only hope things do not get worse from here. As an employee, you want to certainly hope that you are not the pawn being a variable factor that will be sacrificed if things go downhill from here.

2.) No Job is Perfect Forever

Great jobs and roles, even if they are perfect today, might not be the case forever.

Bosses and colleagues may move on and change, management priorities may evolve or the job security you once had may no longer be valid case anymore.

You may have a new boss who micromanages your work, new colleagues who may be difficult to work with or new tasks that you may not like as much as before.

Regardless, things might be quickly change and be different from what once you used to love but not so anymore.

3.) Changing Priorities in Life

Most of us will have different priorities at different stages of life.

If you are young and single, you may dedicate more time and commit more resources to work because you can afford to do so with your vibrant health and aspirations.

Once you are married and have children, your priorities would likely shift towards a more work-life balance lifestyle. You want to avoid a situation where you have to burn midnight oil consistently to have a conference meeting with the other side of the world or worse still outside most of the time, missing precious family time together and most of your children's growth years.

When you get older, you may find yourself getting more tired or your health might just deteriorate to the point that you are not able to function as effectively as before.

4.) Keeping Discipline Over Your Personal Finance Situation

One of the greatest thing once you decide to pursue this path towards financial independence is you start to get discipline over your personal finance and be anal about everything that's going in and out of your bank account and spending.

A nicer way to put it in context is perhaps accountability.

You will want to be in charge over the spending that you can control while choosing to keep your lifestyle balance in check.


Since I started writing and working, my view towards money is relatively simple and straightforward.

While we acknowledge that money is not the solution to everything, we are cognizant to the belief that money is a tool where we can:

I.) Care enough for our family needs;
II.) Reduce our dependency on others (e.g employment) for needs;
III.) Increase our impact to the society through our beliefs.

Clearly, the reader mentioned above has full commitment to point number 1 which is to care enough for her family needs. However, she clearly lacks the coordination to look at things from the job security point of view, thinking that commitment to her employer would be the ticket to her financial security for life.

While I am glad that she wrote in to me and started to look at things from her perspective more seriously than before, I have no doubt in mind that she will pull through this with her determined positive attitude. If she had started realizing this earlier, she could have probably fared slightly better than she is today but I guess it's not too late to start anything.

Sometimes, life throws us a curve ball that doesn't go the way we planned. All that matters is how we handle it and the person we become on the other side of the changes.

P.S: If anyone has a job opportunity in Customer Happiness role and are willing to refer, I'd be more than happy to link up and refer this lady for the role.

Thanks for reading.

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Thursday, June 18, 2020

Wirecard AG - Best and Worst Case Scenario

If you have not heard by now, the latest scandal involving a blue chip payments aggregator company, Wirecard has sent its shares plunged down by nearly 62% after the company revealed that for the third time they are unable to publish its annual report for FY2019 on time.

Unlike the previous two sessions, this time round the findings are a lot more serious when its auditor EY refused to sign off the audited statement after casting doubts that up on the €1.9b of cash equivalent and security deposits they are currently reporting in the balance sheet.

The seismic shock has sent an ultimate blow to the company and also the entire Germany's financial market as it rocked over the going concern and fraudulent event that will be remembered as one of the darkest days in the Germany's financial history.

What is worse for them is they have another €2b loan covenant due by this Friday and that the banks can call up this loan if the company failed to produce a signed audited statement.

In the last reporting figure, the company revealed that they held cash equivalent of €3.3b so after taking into account the two events added together, it would put serious doubt over their liquidity position as a going concern.

Wirecard Chief Executive, Markus Braun commented in the after hours of trading that it cannot rule out the fact that Wirecard AG has become the aggrieved party in the case of a potential fraud of considerable proportions. The company has also taken decision to remove board member and COO, Jan Marsalek with immediate effect, replacing him with Dr. James Freis, who is appointed the new compliance board with immediate effect to oversee the case.

So what does this means for investors then.

I'll try to pull out some best and worst case scenarios for the company at this point given the amount of limited information the public has involving the scandal.

Best Case Scenario:

Wirecard plays victim to a fraudulent incident involving individual party/parties, pointing all fingers and incident to the person or trustees involved and seek legal protection over the loan covenants callable by this week.

By doing this, not only will the company be able to delay and potentially recover the loan covenants but also protect the reputation of the company and its board members.

After this scandal event has blown over, the company can start afresh and rebuild on its corporate governance. The company still has a good business model working with many solid companies that's still growing.

Base Case Scenario:

Wirecard still plays victim to the fraudulent incident, get through this dark event, but somewhat managed to pull off by surviving with sufficient liquidity to continue, providing auditor is willing to sign off with an emphasize matter on the corporate governance issues.

The company may have to replace its board members and management with new faces and start rebuilding its reputation again from scratch and to convince both partners and merchants that the company still has a good business model to work with.

Worst Case Scenario:

The most serious case, if this dragged on for much longer will be a total loss of confidence from both its merchants and customers who are partnering with Wirecard.

If major card partners such as Visa, Mastercard and Amex decide to withdraw their agreement with Wirecard, it would be detrimental to the company's survival as they would become redundant as an aggregators.

If financial regulator BaFin (similar to MAS) withdraws Wirecard's banking license, it would also be game over for the company.

I think both scenarios are unlikely to happen at the moment given that the ongoing case is still pending an outcome so this will likely kick in when we know the results and emphasis matter from the auditor itself.


This is almost like a casino roulette for now.

At the current valuation, the company is trading at a price to earnings multiple of only 9x, which fares across its other competitors (E.g Adyen) in the same region who's trading at 190x.

The company can go from the current share price of €40 back to €100 or it can go straight down to €0 if the worst scenario takes place.

To think that the recent fraudulent sales allegations involving Luckin is big enough, this time round it's even larger and more serious repercussion with Wirecard being a fintech company, which would surely put an alert for more due diligence revolving the financial industry moving into digital world.

Thanks for reading.

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Monday, June 15, 2020

Thought Process On Picking Your First Stock

I've had countless queries in the past and a couple of emails recently from readers who are interested to start investing and one of the commonly asked questions is ways to pick the correct stock to invest.

The first stock purchase for an investor is always intriguing. 

The emotions when you first purchase your stock are filled with mystery, excitement, fear and then there's always the risk and reward. Many will soon get addicted to it and then will proceed with the next second and third purchase and so on.

It's incredibly difficult to answer this short question to any investors who are asking as there's legitimately no right or wrong answer. Nevertheless, I'll try to provide some framework guidance which hopefully can be productive and useful to any investors who's starting to venture out on their own.

Step 1: Organize a list of companies in your respective region that are big market cap

Your very first step as a beginner should always be looking at the bigger market cap in your respective region.

This means looking at the likes of blue chip companies such as Singtel, DBS, OCBC, Sembcorp and SIA in your STI index if you are looking at the Singapore market. In the US market, you will get a list of acquainted well-known companies such as Apple, Boeing, Facebook, Starbucks, Visa and many more.

Don't buy them yet at this point because there's many rotten apples hidden in the fundamental of these companies, even for blue chips.

At this point, all you want to do is to get a grasp understanding of:

  • What is their business model?
  • What products do they sell?
  • What competitive advantage do they have over their competitors?
  • How much market share have they acquired?
  • Management capability and their historical financial performance

Most, if not all of these information, are easily available in the annual reports or financial statement of the company where typically management would provide operational quantitative updates on how they are doing or coping with the situation.

All you really need to do at this point is just to spend some time gathering the information and writing some notes down and that's it. No action should be taken yet at this point because the information you have is public, which means anyone else will have the same information as you do so that's not really helping you to gain any advantage.

You may also want to segregate the list of companies that are appearing in your newsfeed or newspaper because not all the time they are good. The fact that you read in the newspapers that people are queueing up at McDonald's does not immediately qualify them to be a good stock. 

Always be selective when reading and takes information with a pinch of salt. This way, you will have more questions than answers which is good because it leads you to explore more on your questions.

Step 2: Areas of Competency

Your areas of competency is your competitive advantage over the next other person that you have a lead on.

This lead can be achieved through years of working in the industry and getting to know-how the inside operations of how certain things might work in detail. For example, if you are in procurement, you would know how aggressive your competitors are pricing in their bids for the tender or if you are working in supply chain logistics company, you would better understand the details on transit times, delivery performance, freight claims and customs requirement.

Thus, when you select companies that are in your areas of competency, you are able to value-add your experience to the companies you are prospecting and make better informed decisions from there.

Step 3: Consistently Strong Gross Margins

We haven't really looked at the financials of the company until this point.

Once you select the ideal companies of your choice after step 2, you have to start looking at the financials of the company.

One of the financial metrics that I usually pay close attention to is the company's gross profit margins.

Companies that are able to consistently generate strong gross margins are usually indication that the products or services the company provides are superior and highly valued by its end user which allows the company to scale up for more market share.

Consumers pay a premium for company's products and services because they are superior in many senses which may include design, quality, reliability and uniqueness. Some firms may have also competitive advantage in its supply chain and thus are able to drive increasing gross profit margins over time.

There are certain industries such as consumer staples or constructions that will be struggling with low margins because of the evolving nature of the industry itself. I would want to avoid these companies for now because the industry may be in the transition phase and may take a while to see fruition.

Step 4: Companies Are Not Loaded With Too Much Cash or Debt

While it is quite obvious that companies with too much debts are not natural selection, companies that are hoarding too much cash are not an ideal choice either because it means the company is not allocating enough to grow the business It may also be the case that the company is at saturation point thus management has no options to grow the business any further and sit on the cash.

On this, a quick dirty way of checking is through analysing the company's profitability using the Dupont analysis.

The Dupont analysis is a financial ratio based on the return on equity ratio that is used to analyse a company's ability to increase its return on equity. From this breakdown, not only does an investor is able to recognize the company's profit margins, but he is also able to deduce if that profit margins are coming in from an effective way of using leverage to boost its margins.

The Dupont expression is a function of the profit margin, total asset turnover and equity multiplier.

Step 5: Valuation

The last step is probably the hardest to deduce because it is an art to be able to deduce the right valuation of the company.

The most commonly used method to value a typical company is through a price to earnings ratio, which is simply taking the share price divided by the earnings (excluding any one-off). It is usually very seldom that you see a company trading at below 10x PE ratio and if it does it is usually in an industry where it is in a very competitive space. Don't get into the trap thinking that it is a value buy just because it is trading very cheap on the market.

The higher the company's moat, the higher the market tends to price in the valuation so a good overall benchmark is to look at their historical and competitor's valuation and see where they stand at.


This is not a hard proof and only way of looking at companies.

There are probably a thousand and one ways one could have select companies that they decide to ultimately purchase into the portfolio. For example, the cashflow is another important aspect of a company's financial statement but I figured this would be a little intermediate for beginners.

Nevertheless, I hope these framework will provide the very basic guidelines that as beginners you are able to start the ball rolling.

As always, the market is and will always be there so there is no need to FOMO on companies that you think you might have missed. It is always better to err on the caution and miss the gain than having put your hard earned money and earn that loss in the long run.

Thanks for reading.

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Sunday, June 14, 2020

The Wrath of the "Non-Essential" Roles

On Sunday Times today, the newspaper came out with a controversial article that has raised a few eyebrows and backlashes from the public.

Amongst my small circle group of friends,  they were mostly grouped who comes from the line of art, engineer, lawyer, healthcare, research, human resource, financial advisors, IT, bankers, entrepreneur and self-employed.

Apart from healthcare, most belong to the group of non-essential jobs that ST has identified, yet these are jobs that most people are likely to rake in the biggest chunk of money home and are the mostly sought after courses in the university.

NMP Economist Walter Theseira said in his interview that it is hard to separate interest from compensation, as most graduates are convinced to pursue courses in the university that has the highest salary potential or lifestyle associated with the job once they graduate.

As an interviewer for student admissions, he is often amazed by the number of people who told him during the interview sincerely that they found accounting interesting and the reason for pursuing the course is pure out of passion.

Having been an accountant myself for close to 12 years, I can say that it's almost close to impossible that one would pursue an accounting course out of pure passion. While having that knowledge is nice (as with any other roles), accounting as a job itself is pure Fifty-Shades-of-Grey slavery. What comes as a big plus is the perception being an iron rice bowl with guaranteed job security and steady stream of income and benefits.

So coming back to the article itself, perhaps it's wiser to have things defined as an immediate essentials vs non-immediate essentials rather comparing it as essentials vs non-essentials.

Immediate essentials - as the name implies, are things that require immediate attention, so you have things like doctors, nurses, garbage collectors and deliverymen (during circuit breaker) providing services that attend to your immediate needs.

The non-immediate essentials role like business consultants, teachers, support teams like finance and HR, sales or pilots are also essential jobs. These people help to rebuild businesses and people to retain and retrain and their roles are not less effective than the essential jobs. What differs them is that they may not be as vital as an immediate concerns for the next 24 hours.

Perhaps the definition of essentials vs non-essentials may also be different in different times. For example, if we are in a war situation right now, you are likely to see an increase importance in army and soldiers and much lesser on garbage collectors and delivery men. So the paradigm might shift and we are all on this together to make up a good round community together.

The insensitive article from ST might also be an agenda to push for another round of minimum or universal basic income, based on the current Maslow's hierarchical of needs, which will surely be raised from the opposition during the election rally not any longer from now.

If only, things were defined better, I think we could get most of the readers to accept how the article is being written.

The next time my boss asked me to do things urgently, I will tell her that my role is non-essential, okay?

Thanks for reading.

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Friday, June 12, 2020

DataDog - Why I Like Its Business But Hate Its Valuation

This is another round of trying to look into more related companies in the tech space, something which I have not managed to do in the past.

This time, I'm looking at Datadog, an organization which took a big leap of faith since it began to introduce its cloud-scale monitoring service in 2017 to a wide range of diverse clientele.

In a business landscape where competition is fierce and time between development and deployment is faster than before, it pays for companies to do everything in their power to ensure that their software delivers a steady baseline of performance 24/7, so that any cloud based software or web based applications are not disrupted, that's where APM (Application Performance Management) comes in.

This includes the likes of load testing, synthetic monitoring, real-user interaction and root-cause analysis to ensure things run smoothly in between any end to end users and minimal disruptions are applied to the business.

What really sells for them is its ability to integrate with many other cloud applications, provide monitoring of servers, databases, tools and services, through a SaaS-based data analytics platform.

The comprehensive backend system was built using a number of open and closed source technologies with API integrations that are able to support multiple cloud service providers such as Amazon Web Services (AWS), Microsoft Azure, Google Cloud, Red Hat and many more. Today, the company supports over 400 integrations out-of-the-box.


One look at their financials and you can easily see why the market love them.

The company has an impressive set of turnover growth in the last 13 quarters from FY2017 to Q1 FY2020 with revenue going from as low as $25m back in Q1 2017 to $131m in Q1 2020.

With primary COGS being network, delivery and maintenance costs, SaaS companies like Datadog tends to achieve high gross margins, typically in the range of between 77% to 80% once the company reach enough scale for them to grow their customer base vertically.

Unlike traditional software companies that had to spend on a variety of technology stacks and infrastructure costs (i.e operating systems, servers, databases), most SaaS companies are not required to support those as they tap on third party integrations to do so.

Most of its costs are spent on R&D, which is expensed upfront that made up between 27% to 32% of its overall turnover, enabling the organization to focus on the next phase of growth through innovation and new enabler.

Cost of Acquisition (CAC) remains an integral part of any business as it continues to grow its sticky customer base at a lower marginal interval as part of the overall important unit economics to boost its lifetime value of the customer.

SG&A costs are the people's and other general costs that made up of the other 10% of the costs.

The company had a solid reporting unit economic when it comes to dollar-based net retention rate, which was in the range of 146% during IPO and still managed to rake in above 130% in Q1 FY2020 for the 10th consecutive quarters, which is a strong testament of how sticky their customer profile is.


For a company that has only been profitable for one quarter in Q1 FY2020, we will not be able to rely on the price to earnings multiple accurately to come up with what the company is worth for.

Using a backward envelope method of valuing a SaaS company, we will base our computation using the market capitalization worth of $24.3 billion, which translates to its latest share price of about $75/share.

If we divide this by the revenue they generate in the last 12 trailing months from Q1FY2019 to Q1FY2020, this implies a turnover multiples of close to 36x, which signals to the public that either the share price is overvalued or the company is growing at a solar-rapid pace than what the market is expecting them to grow at.

For purpose of reference, I have appended a list of SaaS company's market cap and its enterprise value.

To justify a range of multiples based on the publicly listed SaaS companies, the market is expecting the company to grow at between 160% to 180% year on year, which sorts of ridicule the current overheated tech market we have today in Nasdaq. 

For Datadog, they grew their topline from USD70m in Q1 FY2019 to USD131m in Q1 FY2020, which almost double (100% increase). Number of subscribers with $100k ARR have also risen from 453 in 2018 to 858 in 2019 while subscribers in the $1m ARR category rises from 29 in 2018 to 50 in 2019.

Those impressive growth stats justify the companies at best 20x to 22x multiples, while at 36x the market may be pushing it too far. Perhaps a pullback will do justification for that, like what we've seen when the market fizzled back in March.


I do think that the company has an interesting business and product offerings to watch out for that is able to capture more market share for them to grow.

There are also imminent growth plans from both the organic and inorganic as the company looks for its next phase of growth in this new era of cloud technology.

However, the current valuations make them somewhat vulnerable to a potential crash in the market and a bit too rich for my liking at the moment despite their impressive growth year on year and back to back.

I'll continue to monitor their development and progress in this space while waiting for its valuation to subside before entering.

Thanks for reading.

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Wednesday, June 10, 2020

Holistic Approach to Financial Planning with DBS NAV Planner

If I were to throw a question to the audience on how many that have religiously tracked their spending in the last one year, the number would not have been significant. 

The main reason for this is budgeting and tracking our expenses are a hassle. If anyone has found it challenging to stick to a budget, you are not alone. 

According to the research study by Business Insider conducted last year just before the Covid, half of all Singaporeans do not stash at least 6 months’ worth of emergency funds. One in five does not even have 1-month worth of expenses in savings. 

This is a staggering growing concern for many Singaporeans who have to cope with the increasing cost of living, living day to day without a plan. 

One main reason for this is that most people do not bother to plan for rainy days and when an unprecedented crisis like Covid hits the shore, it’s too late to make adjustments to the lifestyle. 

My Story: 

When I first started working years back, I started tracking all my incoming income and outgoing expenses in an excel spreadsheet. 
It takes a lot of effort to update the spreadsheet every single day to ensure that my cash balances in the bank reconcile back to the amount of expenses spent and incoming receipts. 

While I am an accountant by profession and this is typically what I have been doing for my corporate accounts (even so, we have started to automate the reconciliation), it still feels like a lot of work to me when I get home to do one for myself. 

Not only do I have to get the reconciliation to balance, but I have also categorized each expense to prepare a schedule. For example, under my Non-Discretionary segment, I categorize my expenses to include mortgage and maintenance, groceries, transportation, utilities, etc. 

After a while, I decided to forgo the schedule due to too much effort and I switched to rely on the budgeting tools from my bank account which tracked my receipt and expenses accordingly.

Introducing DBS' NAV Planner

Clicking on the legend on the right will bring you to an analysis. Forgive the alarming figures, I'll get on this later!

NAV Planner is a new digital advisory and budgeting tool that helps its customers consolidate and analyse their overall financial spending patterns through the financial information that flows in and out of their bank accounts.

The current version is an upgraded version of the previous DBS GPS tool launched in 2018 where it focused more on financial streams.

Apart from being able to track spending, which is always important, this time round, the launch will revolve around three rings (see below):
  • Savings (Light Orange) 
  • Insurance (Dark Orange) 
  • Investments (Red and pink) 
That said, I’ll talk about just three of my favourite features: Money in Money Out, Investments and Emergency Savings.

The Expected: Money In Money Out

What I like about NAV Planner as a budgeting tool is that there’s automatic categorization so I know exactly what I’m spending on. There are several broad, catch-all categories that are generally quite accurate.

(In the event you don’t agree with the classification you can always change it, and they will remember future transactions!)

One quick look, and you’ll get a rough idea of where your money flowed out to this month. Even if you’re the compulsive sort who ENJOYs inputting data into spreadsheets, you have to admit this is useful for quickly identifying any red flags in expenditure.

Really Neat: Emergency Savings

Okay, here is when it gets cool.

Based on what I’ve been spending for the past six months, NAV will also be able advice if the current savings are able to meet the next few months of disbursement.

For instance, if you spent an average of $3,000 a month but only have $9,000 in the bank, they’ll be able to tell you that you only have three months of emergency savings, which is below the recommended six.

In case you’re wondering why my NAV planner says I only have 0.5 months of spending, it’s because my monthly expenditure for the last six months averaged around $160k due to a combination of renovation and other investments.

With my current cash savings as $80,000, they've calculated that this amount can only last a month!

Nice to have: Investment Overview

Keeping track of your investments is hard. Especially if you're a prolific investor. NAV is trying to change that.

If your investment is in digiPortfolio, the NAV Planner would also track the net asset market value of your investments and embed them into your overall financial plans.

You can also manually add non-DBS assets so it captures those investments as well (yes, it’s tedious the first and only time you do it, but it’s a small price to pay for the convenience for having a consolidated view of your investments).

In the future, DBS says you’ll be able to add individual equities to the mix.

So if you’ve 50 shares of say, TSLA, you’ll be able to view them with prices updated daily.

Finally, for newbie investors who are new to investing, DBS also gives you some tips to start investing, whether it is through Unit Trusts or ETFs.

Of course, if you’re an active investor like me, it might not be that relevant. But hey, it’s important that people get started!


In times such as COVID-19 when we are working harder and rest is in short supply (ironically due to WFH), this is a welcome departure from hours spent on spreadsheets and budgeting apps of the past. 

The NAV Planner is more than a budgeting tool. It’s an all-round financial dashboard that allows you to see each aspect of your finances holistically from savings to investments to expenditure. 

It also lets you have a bird eye view from the top to see how much cashflow that goes in and out every month so that you can make better forecasting decisions. 

When you see how all the pieces come together, it’s so much easier to navigate your life better. 

If you’ve been putting off financial planning, now you really have no excuse.

Disclaimer: This is a collaboration article with DBS on the navigation of DBS NAV but all opinions stated are purely mine and vetted. 

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Monday, June 8, 2020

Shareable Asset - Investing Platform for Real Estate Using Blockchain Technology

If there's anything that we've learned during Covid-19, it is that the potential of digital financial services in providing a secure, low-cost and contactless tools has become more apparent during the crisis. 

The reliance on convenience that digital financial services are starting to innovate has driven the demand needs for more fintech services.

Shareable Assets (SA) has positioned itself as the disruptor of the global real estate market offering fractional and affordable ownership in institutional-grade real estate which were previously only available to accredited high net worth investors.

The company prides itself as the "Amazon in the real estate industry" and is the only one globally so far that has been approved as a fintech based securities investment company that utilizes blockchain technology for real estate. They have also received the Capital Markets Services (CMS) license from the Monetary Authority of Singapore (MAS) that allows for the digitalization and tokenization of real estate trading using blockchain technology.

How It Works

Shareable Asset works by dividing real estate ownership into smaller pieces to allow accessibility for anyone to invest.

For instance, a real estate commercial building which costs $1m is divided into 100 blocks of $10,000 each. Based on the number of blocks that a person owns, the allocation of equity and voting rights is shared proportionally. This proportion also applies the same to the revenue and divestment distribution.

The security token will be available and issued through the Shareable Asset platform sold from the establishment of the Special Purpose Vehicle (SPV) entity. 

Value Proposition

As most readers would know, I spent a brief period working in the Real Estate Investment Trust ("REIT") company in the past. Today, I am working in an e-commerce fintech enabler start-up company providing services to businesses and consumers. Because of this, I tend to appreciate companies that tend to come up with interesting value proposition and business model that is able to add values to investors. 

Unlike the physical real estate market where investors are required to put in a minimum of hundreds to thousand dollars of funds, Shareable Asset is able to facilitate entry-level investments for the retail masses for as low as $100. This gives an opportunity for anyone who wishes to dip their toes into the real estate market exposure. As owners of the real estate under the equity structure, rental income will accrue and be paid to investors for as long as the space is tenanted.

Some may argue that the Real Estate Investment Trust (REIT) vehicle we have today in the market may provide the same value proposition when it comes to owning real estate at minimum funds but let me give you an overview run-down of the other differences.

First, the platform listing fees for Shareable Asset are much lower than REITs as a listed entity as it requires only to maintain the CMS license which is a regulatory requirement from MAS. For REITs, the requirement to adhere with reporting guidelines and compliance regulation means the company will spend a bit more overhead costs to maintain its listing status. 

Second, Shareable Asset managers take a relatively small amount of cut as a percentage of the management fees as opposed to REITs in the range of 1% to 5% depending on transaction size. REITs typically incur a base management fees of between 0.25% to 0.50%, which is on top of the other performance and acquisition or divestment fees that the REITs managers are entitled to. 

Third, Shareable Asset is able to tap and penetrate into the larger real estate market globally using its blockchain technology capability. REITs' portfolio size is usually at least USD500 million to USD1.0 billion to be eligible for listing and they target high-value real estate.

Last but not least, Shareable Asset is a single platform managing a diversified portfolio with the same objective and aspiration. Hence, investors will be assured that they are in good hands with a regulated platform that shares the same vision as investors.

Steps To Sign Up

The key to using blockchain technology to invest is simple and secure.

To do this, download the "Shareable Asset" application in your mobile and register to sign up.

You will be asked to confirm your email registration address and insert a safe-pin to protect it.

You will also be asked to take a self-photo of your own picture, passport and proof of address, all securely online. Verification of account takes 1 to 3 business days, and you will be receiving notification about your account status.

Next, you will be asked to do a simply KYC form which has 9 multiple-choice questions. The questions asked are pretty standard in compliance with the requirement of MAS.

After that, you will be asked to select the properties that you are interested to invest in. The snapshot will provide detailed information that you need to know as an investor such as the location, tenure, leasehold and net yield rent. You will then choose how much money you want to invest (can be as little as $100) in each of the property you select.

You are good to go.

As part of the referral incentive program, you can now sign up and receive a free investment credit of £3 when you sign up using my referral links here.

Upcoming Launch by Mid-Jun 2020

Shareable Asset will launch its first deal in mid-June 2020 through the anticipated proof of concept student hostel's accommodation.

As a testament of how "hot" these assets are in the market, Singaporean based media company, SPH recently acquired £448m of student housing accommodation in the UK while local property developers like Far East Orchard and Mapletree Investments recently purchased £67m and £96m of UK housing accommodations as well.

The company will continue to look for suitable investment opportunities that will provide good return on capital for investors in the few months to come. The goal is to have at least another 10 to 20 investment properties available for selection by the end of this year.

For more information, please visit their website at

P.S: This is a collaboration with Shareable Asset on the abovementioned launch and a study of the blockchain technology but all opinions are mine solely and vetted.

Register Here

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Sunday, June 7, 2020

Hyphens Pharma International Ltd (SGX: 1J5) - Uncovering Healthcare Gems

Hyphens Pharma International Ltd (SGX: 1J5) is a pharmaceutical company which focuses on the sales and marketing of specialty pharmaceutical products in key ASEAN countries through exclusive distributorship or licensing agreements with brand principals mainly from Europe and United States.

The company was listed on 18th May 2018 about two years ago on the SGX Catalyst.

Since then, they have grown over the years and have done reasonably well in the midst of the pandemic outbreak through the product offerings they provide.

I was invited to their recent results briefing which I attended and had a chance to speak and ask my questions directly with their CFO, Lee Wei and CEO, See Wah.

Core Businesses

Before we go into that and also run through their recent Q1 FY2020 results, let me give a brief context of their main core businesses.

The Group's core business comprises of 3 main segments: Specialty Pharma Principals, Proprietary Brands and Medical Hypermart & Digital.

The Group has exclusive distributorship to sell and distribute specialty products in countries that they have agreements on. The Group also owns well-known proprietary brands of Ceradan® and Ocean Health® supplements that I personally consume at home myself.

Our family had also used the nasal spray product, Sterimar® for our children when they were younger.

Financial Results

The Group had a strong run of revenue and profits growth since FY2015 before they went IPO in FY2018.

5 Year CAGR for revenue and profit after tax increase 11.1% and 6.3% respectively.

The number would have been higher if not for the IPO expenses that they incurred in FY2018 that dragged the numbers down by a little bit.

Still, you can see from the past growth trend and after attending the call myself, I am able to appreciate the business model a lot better than before.

The Group recently released its Q1 FY2020 results which saw a strong double digit growth in both topline and bottomline.

Revenue increased by 16.4% YoY or by S$4.4m mainly due to higher sales of the Specialty Pharma Principals segment from the higher demand in Singapore and Vietnam.

The increase was also complemented by the resurging sales of their dermatology products under Ceradan®TDF® and Ocean Health® brands as well as medical hypermart that included sales of PPE suits to hospitals and pharmaceuticals.

Across all business segments in all geographical regions, the businesses have registered double digit growth, which is a testament to their strong product performance during the Covid period. Margins have also increased due to the strong mix of product offerings.

Is The Growth Sustainable Post-Covid?

One of my areas of concern is the sustainability of these growths especially during a one-off event like Covid so I asked during the call if we will see a reversal of the trend post-Covid period.

The management were very candid about prospecting life after Covid. While the outbreak does contribute to the increase amount of sales in Q1 FY2020, they think that the trend should continue to increase over time.

One of the initiatives which the Group have taken during Covid is to increase their omni-channel of sales through engaging more digital partnership with the likes of Lazada and Shopee.

While direct sales through B2C is still a small proportion of the overall sales right now, they are optimistic that the e-commerce trend of buying products online getting more popular.

In addition, the Group continues to plan for new product offerings in the next few years - a couple in dermatology and a few in supplements which are ready to be launched this year while the rest are currently in registration or development pipeline.

This process might take 1 to 2 years depending on the requirement of each country's regulatory authority.

Dividend Payout

The Group remained committed to pay at least 30% of their earnings as dividends as evident in FY2019 where they have doubled their dividends to 1 cent upon strong earnings.

The rest of the retained cash is to conserve for any opportunistic organic and inorganic move through more product offerings, geographical expansion, extension of principal agreements or any M&A.


The company has seen high trading volume in the past week which sees its share price rose to its high of 37 cents on the 1st Jun before retreating to 33 cents on the 5th Jun market closing.

At the current share price of 33 cents, the company is trading at a price to earnings of 11.6x based on the forward twelve months earnings based on the Q1 FY2020 annualised results out of which net cash per share is worth 9 cents/share. That means investors are only paying an ex-cash PER of about 8.4x for its business.

For a growth healthcare play company, I don't think the valuation is excessive given how much the other healthcare company's valuation are currently trading in the market.

I'll do a quick run-down of DCF based on the below scenario. Do take note the few assumptions made below:

- IPO expenses for FY2018 of $0.9m were added back to the EBIT.
- Effective Tax Rate of 17% were used.
- $0.85m were added back to the D&A in FY2019 as it is related to Rights Use of Assets based on IFRS16 adoption.
- CAGR based on 12% over the next 5 years which is within management agenda and long term historical 5 year growth.
- Maintenance Capex to D&A ratio is approximately 0.67x based on historical average except during IPO year.

Assuming the Group warrants a multiple of 15x PER, which is just about right to value a healthcare company, the share price intrinsic value should trend closer to 38 cents, which represents close to 15% upside from the current share price.

If we were to subscribe a slightly higher multiples at 17x PER, the intrinsic value would go higher to 42 cents based on these assumptions.


I'll try to balance out with some of the potential risks that investors might want to watch out for.

There are currently two principal agreements expiring at the end of this year and the Group is currently engaging for an extension.

Product registrations also typically take at least 1 to 2 years depending on location, with countries such as Indonesia taking longer due to regulation.

With other healthcare companies trading at typically higher valuation, it is also difficult for Hyphens to engage in M&A that might be accretive to their company, given the low valuation the company is trading right now. Hence, a lot of things might be wait and see until they find a suitable acquisition target.

Disclaimer: This article is a collaboration with Hyphens Pharma International to cover the business model and financial aspect of the company. However, all opinions are purely my own unless stated otherwise.

This article is sponsored by Hyphens Pharma International. Any information, commentary, recommendations or statements of opinion provided here are for general information purposes only. It is not intended to be a personalised investment advice or a solicitation for the purchase or sale of securities. Before purchasing any discussed securities, please be sure actions are in line with your investment objectives, financial situation and particular needs. International investors may be subject to additional risks arising from currency fluctuations and/or local taxes or restrictions. The information contained in this publication are obtained from, or based upon publicly available sources that we believe to reliable, but no warranty are made as to their accuracy or usefulness of the information provided, and accepts no liability for losses incurred by readers using research. Recommendations and opinions are subject to change without notice. Please remember that investments can go up and down, including the possibility a stock could lose all of its value. Past performance is not indicative of future results. The shareholders of the Company and potential investors should exercise caution when trading in the Company’s shares. Persons who are in doubt as to the action they should take should consult their legal, financial, tax or other professional advisers.

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