Low Keng Huat (Singapore)

[Jacmar]

Thanks for this Jacmar. It's good to get long term investors opinion. The metrics for this stock are exceptional. However, worries I had were:

[1] Is Singapore property market in a bubble.
[2] Are the Low brothers getting too old to manage the company effectively.
[3] Free Cash flow seems very erratic, but I guess that's the nature of the business.
[4] Problems with tax in Vietnam.

I guess worries about number 1 are probably what is keeping the stock so cheap. Reading between the lines on the financial reports, the company seems to be suitably cautious going forward. It's comforting to know that the company has many years experience in the Singapore property market.

IMHO, yes singapore property is in bubble territory. For LKH they don't have much unsold property. the DBSS project is a small project for them and even that it is already 70% sold. so not much worries there. yes they are very cautious and conservative and have not seen them bidding for new projects which is good. The senior Low has passed the baton to his son and the other brother is not that old. FCF is erratic as it is the nature of property developer. fortunately for them they have 2 hotels and their F&B is generating good fcf.the tax issue is manageable and has already been accounted for.

as usual pls do your own research as my opinion is biased.