Boustead Singapore

(09-04-2025, 09:52 AM)ksir Wrote: Really have to give it for the steady (g)old hands like Mr FF Wong & of course Warren B.
Warren B has again proved his super good timing with his humongous warchest.
After (arguably) largely missed out deploying warchest during covid plunges, now probably another chance for Boustead to significantly make good use of its (idled) cash? now that BP asset heavy ventures likely hard to proceed or expand.

haha i dont think this serves justice to warren

Warren bought apple and sold some 70% of it before the recent fall in apple's share price. Made many many billions

Boustead bought supposed undervalued bonds and got stuck with a como hotel. Put on sale with the hope that someone will buy. Given today's sentiments, i am unsure who would buy. Ends up incurring interest expense that may not even be covered by operating revenue. Struggle to make money

(09-04-2025, 01:18 PM)money Wrote: haha i dont think this serves justice to warren

Warren bought apple and sold some 70% of it before the recent fall in apple's share price. Made many many billions

Boustead bought supposed undervalued bonds and got stuck with a como hotel. Put on sale with the hope that someone will buy. Given today's sentiments, i am unsure who would buy. Ends up incurring interest expense that may not even be covered by operating revenue. Struggle to make money

Hi money,

I do agree with you it is far fetch to compare the two but my opinion on the COMO Orchard purchase differs with yours.

A quick background: Boustead/JV partner bought distressed mezzanine debt of the developer which are still subordinated to other creditors (bank debt, suppliers). When the developer of the land underwent voluntary liquidation, Boustead/JV partner bought over the asset and part of the purchase consideration was offset by the mezzanine debt. These are actually 2 transactions - the first is some sort of distressed debt investing, and the 2nd is a pre-auction sale.

Some notes:

(1) Unlike individuals paying interest on their mortgage payments, companies get tax deductions on their interest payments. If a company uses debt wisely, it is not as bad as an individual loading themselves up with a huge mortgage at high interest costs.

(2) Como Orchard is under JV accounting and so I am not sure how about the actual accounting since they are not represented on BSL's own financials. My guess is that Como Orchard is classified as PPE using "cost + depreciation". This means that the accounting is relatively conservative and when the eventual sale come, I wouldn't be surprised by large gains (recognized as share of profits from associate/JV) when it is been sold as "investment property".

(3) The business of hotel brands and operators is to help to maintain/elevate the prestige of the property. The operating returns of such investment properties have low ROICs to the owner of the property, but that is besides the point. Sometimes, buyers of investment properties may care more about wealth preservation than wealth creation.

(4) So how is the eventual sale going to come? I think a clue would be Como Orchard's neighbor Pullman Singapore Orchard. About 10years ago, it was sold by the previous hotel owner who also operated its own hotel brand, to a Mainland Chinese tycoon. In the last few years, the same tycoon was in the news in the aborted sale of Far East Shopping Center.

So end of the day, it is my belief that if you got a good asset at good prices and able to wait it out while adding value to it (eg. operating it), your future profit potential is enormous. Things are not linear in business or investing.

(09-04-2025, 01:18 PM)money Wrote:

(09-04-2025, 09:52 AM)ksir Wrote: Really have to give it for the steady (g)old hands like Mr FF Wong & of course Warren B.
Warren B has again proved his super good timing with his humongous warchest.
After (arguably) largely missed out deploying warchest during covid plunges, now probably another chance for Boustead to significantly make good use of its (idled) cash? now that BP asset heavy ventures likely hard to proceed or expand.

haha i dont think this serves justice to warren

Warren bought apple and sold some 70% of it before the recent fall in apple's share price. Made many many billions

Boustead bought supposed undervalued bonds and got stuck with a como hotel. Put on sale with the hope that someone will buy. Given today's sentiments, i am unsure who would buy. Ends up incurring interest expense that may not even be covered by operating revenue. Struggle to make money

1) Don't think I ever imply or intend to compare the 2 based on their investment result.
2) It's more of their way of having warchest for opportunity such as now.
3) Selectively pick & compare their investment based on 1 investment case is just BS. 
eg: we can also pick Dexter shoes in warren case.

FY 2025 full year results OK, but flattered by one-time gain related to UIB transaction.

chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://links.sgx.com/FileOpen/Boustead%20SGXNet%20Announcement-FY2025-26.05.2025.ashx?App=Announcement&FileID=846833

Revenue down 31%
Profit up 48% (would have been 8% without one-time gain), or 19.57c/share

4c final dividend + 2c special dividend, to add to previous 1.5c interim dividend. Special and final dividend will be paid in late September, so something to look forward to.

A big bulk of BSL's real estate is in BIF (Boustead Industrial Fund), an open ended fund. So I guess the aim is to convert this fund to become a REIT, a more perpetual financing capital structure (closed end fund of sorts).

In the previous decade, there had been a huge influx of industrial REITs onto the SGX and BSL did not participate. Now, many of these industrial REITs have consolidated (thanks to ESR) and BSL is considered a late comer to the party. The REIT IPO does seem to be slowly reviving on the local bourse and that could be reflective of how the various towkays/CEOs view the future prospects..

BOUSTEAD CONDUCTS STRATEGIC REVIEW OF ITS SINGAPORE LOGISTICS AND INDUSTRIAL ASSETS

The Board of Directors (the “Board”) of Boustead Singapore Limited (the “Company”) wishes to announce that the Company is undertaking strategic reviews in respect of its stakes in its Singapore logistics and industrial real estate assets, which includes a potential sale to a real estate investment trust to be listed on the Mainboard of Singapore Exchange Securities Trading Limited. This strategic review process is part of the Company’s ordinary course of business to periodically consider options and opportunities in respect of its investments to unlock shareholder value, and there is no certainty that any transaction will materialise as a result of this process.

https://links.sgx.com/FileOpen/Boustead%...eID=848738

The current AUM of Boustead Industrial Fund stands at approximately S$635 million, as per the AR2024 disclosure. Converting to a REIT, a perpetual structure, makes sense. However, investors (Boustead and Metro) might earn less due to the fund's structure, which mainly make up of bank borrowing and QDS taxed at 10%. In contrast, a REIT would subject company-held income to a 17% tax rate (though individuals would remain tax-transparent).

In the 2021 EGM FAQs, management mentioned that the remaining properties, valued at around S$0.7 million, are mainly held by the JV. It's possible they plan to monetize these assets. I think this could be the one they intend to monetise but i can't reconcile to the recent announcement on the pan asia UIB fund which i thought is to sell their remaining stakes.

Boustead Singapore – A Familiar Playbook with Hidden Value?

Centurion made headlines when its share price climbed from 40 cents to 1.50 as it progressively monetised its assets through REIT-related structures. This rerating was driven by clearer visibility on asset value and investors’ anticipation of capital recycling and improved returns.

Interestingly, Boustead Singapore may be treading a similar path.

The group has disclosed that it is undertaking a strategic review of its Singapore logistics and industrial assets. This includes the possibility of asset monetisation, divestments, or even a REIT listing.

Boustead’s current book NAV stands at approximately 1.18 per share, which includes net cash of around 320 million. This implies that the market is valuing its operating businesses and assets at only 270 million, based on 500 million shares.

However, based on Boustead’s FY2024 disclosures, the market valuation of its completed industrial properties is around 1.1 billion (excluding BIF and KBIL,) Assuming a 75 percent effective ownership, the attributable value to Boustead is approximately 825 million — more than three times its current ex-cash NAV. (page 47 of Annual Report 2024).


This raises the question: if Centurion’s share price could quadruple on the back of asset monetisation, could Boustead see a similar rerating as the market begins to reflect its underlying asset value more accurately?

Of course, outcomes depend on many variables — execution, market sentiment, regulatory approvals, and timing, among others.

(13-06-2025, 09:02 PM)Curiousparty Wrote: Boustead Singapore – A Familiar Playbook with Hidden Value?

Centurion made headlines when its share price climbed from 40 cents to 1.50 as it progressively monetised its assets through REIT-related structures. This rerating was driven by clearer visibility on asset value and investors’ anticipation of capital recycling and improved returns.

Interestingly, Boustead Singapore may be treading a similar path.

The group has disclosed that it is undertaking a strategic review of its Singapore logistics and industrial assets. This includes the possibility of asset monetisation, divestments, or even a REIT listing.

Boustead’s current book NAV stands at approximately 1.18 per share, which includes net cash of around 320 million. This implies that the market is valuing its operating businesses and assets at only 270 million, based on 500 million shares.

However, based on Boustead’s FY2024 disclosures, the market valuation of its completed industrial properties is around 1.1 billion (excluding BIF and KBIL,) Assuming a 75 percent effective ownership, the attributable value to Boustead is approximately 825 million — more than three times its current ex-cash NAV. (page 47 of Annual Report 2024).


This raises the question: if Centurion’s share price could quadruple on the back of asset monetisation, could Boustead see a similar rerating as the market begins to reflect its underlying asset value more accurately?

Of course, outcomes depend on many variables — execution, market sentiment, regulatory approvals, and timing, among others.

Most of the properties are held by associates (Boustead Industrial Fund) and other JV partners which suggest ownership of less than 50%. if based on 75%, this would most likely be consolidated in the books, i.e. reflect under investment properties. 

and the market valuation in the AR exclude the underlying bank loan which we need to take a hair cut before deriving the equity portion.

At the end of FY2024, outside of BIF and KBIL, our wholly-owned and jointly-owned portfolios contained eight completed properties and one property under development, 36 Tuas Road. The key performance metrics take into account completed properties under other real estate platforms in which BIF and KBIL do not have any interest.

market valuation = $1.1bil...

📢 Boustead’s RNAV Unlocking Story – Platform by Platform

1️⃣ BIF (Boustead Industrial Fund)
📅 Offload Year: 2021
💰 Gain: S$134.8 million
🏢 Valuation: S$805 million
📐 GFA: >212,000 sqm
📌 Singapore-based industrial assets with high occupancy and long WALE.

2️⃣ UIB (Unified Industrial & Boustead)
📅 Offload Year: 2025
💰 Gain: S$29 million
🏢 Valuation: S$197 million
📐 GFA: >286,000 sqm
📌 Vietnam JV platform. Early-stage but showing monetisation progress.

3️⃣ To-be-REITed Portfolio
📅 Offload Status: Pending
💰 Gain: Not yet recognised
🏢 Valuation: S$1.1 billion (based on recent platform valuation)
📐 GFA: >165,000 sqm
📌 High-quality SG properties with >95% occupancy and WALE >7 years.