Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on changes – just in case they’re material to our investing thesis.
With 18 of its 30 constituents ending the day with losses, the Straits Times Index (SGX: ^STI) has also unsurprisingly slipped to 3,339 points, though it must be noted that the index’s loss is only a slight 0.1%.
Given the relative scarcity of market beaters within the STI, let’s take a step outside the benchmark index for a closer look at some winning shares.
Chuan Hup Holdings Limited (SGX: C33) has stepped up by 1.7% to S$0.295. On Monday, the company announced that it has accepted an option to purchase several office units in Singapore for a total sum of S$31.7 million. The properties have a lease of 99 years which started on 12 October 1982 and have a total area of 1,492 square metres. According to a valuation report dated 4 September 2014, the offices have a market value of S$31.7 million.
Chuan Hup, which holds investments in marine, manufacturing, and property businesses amongst others, has the intention to purchase the offices “for the purpose of long term investment… to earn a sustainable and recurring source of rental income.” Given the company’s total assets of US$386 million as of 30 June 2014, the potential property acquisition is certainly not a trivial one.
The Straits Trading Company Limited (SGX: S20) has inched up by 0.3% to S$2.99. The company had made a nice strategic move last week by selling its Straits Trading Building for S$450 million. Based on the property’s historical cost, Straits Trading Company is set to book a gain of S$373 million from the sale.
The company’s looking to deploy the sales proceeds into other high-return real estate projects or assets. One potential beneficiary of Straits Trading Company’s hunt for new acquisitions or partnerships would actually be ARA Asset Management Limited (SGX: D1R). My colleague Sudhan P explains:
“Based on the strategic alliance ARA formed with Straits Trading back in October 2013, ARA will be managing the assets held under Straits Real Estate Pte. Ltd, which is a 90:10 joint venture owned by Straits Trading and Mr John Lim, Group Chief Executive Officer of ARA.
The capital received from the sale of Straits Trading Building could be pumped into Straits Real Estate by Straits Trading to acquire the “potentially higher return real estate opportunities”. If that occurs, it will be a boon for ARA as it will receive management fees from managing those assets.”
Fresh fruit products purveyor Sunmoon Food Co Ltd (SGX: AAJ) has climbed by 4.8% to S$0.131.The company has been busy lately in a bid to expand its business.
Last Thursday, it announced that it would be acquiring 51% of a company known as Ban Fresh for S$5.6 million. Ban Fresh “is in the business of the worldwide procurement of fresh fruits and vegetables and sales of the same in Singapore and other countries in Asia” – that seems a very complementary fit with Sunmoon Food’s main business of distributing fresh fruits and creating related products.
Then, just yesterday, Sunmoon Food revealed that it has entered into two joint-ventures with Rio Vista Ventures LLC (a.k.a. Giumarra). Giumarra is “one of the world’s largest agricultural organizations and is recognised for setting standards of excellence in the world of agribusiness.” One of the JVs would see Giumarra as the main shareholder and would be involved with sourcing and acquiring fresh fruits and vegetables. The other JV would have Sunmoon Food as the majority owner and would be in charge of the distribution and sale of the aforementioned fruits and vegetables.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore writer Chong Ser Jing doesn’t own shares in any companies mentioned.