Source: The Big Picture

You can only gain this kind of astronomical return if you invest in a company that generates increasing profits. The bonus shares and splits are not magic. Having more shares when profits are falling or for the matter turning into losses would just make your stock a bad investment. The business, economics and operation matter if you want to hold a company for long.

Bonus shares and good dividends appear to be indicative of management that has confidence in their business and prefers you stick with them. In my brief exercise, not many would carry out a bonus share issue. Strangely those that issued bonus shares turned out to be rather sturdy companies that grow.

The price you buy matters but it is important to know the value you get. Which is why we keep advocating buying 50 cents for $1 worth. Buy value at reasonable prices. Comparing 2 commodities investments then, you may get more value simply because Noble choose to reward their share holders more.

I tried changing the first buy price of Noble from 22.5 cents to $3 or $6 and turns out you would still make money! You only start losing money if you have bought Noble at $22 in 2001. That to me is pretty amazing.

Compounding and the time value of money will work if you spot a company that grows its earnings and reward you.

Reinvest only in companies with good business, sound management that consistently shows a willingness to reward share holders. Management retires and business environment changes. Noble is in a stage right now where the chairman is struggling to find a successor. We are entering another difficult operation condition. Your dividends will ensure that you receive rewards while waiting. A change from the policy these 10 years (cutting bonus issue and dividend policy) would signal that you need to relook your investment.

Hindsight is a bitch. This exercise just shows I missed a great deal.

HK ‘Superman’ swoops on another mall

Li Ka-shing-owned Cheung Kong Group is buying The Citta, the new suburban mall in Ara Damansara


The Cheung Kong Group, owned by Hong Kong tycoon Li Ka-shing, is buying The Citta Strip Mall for an estimated RM245 million.

Sources told Business Times that the purchase was done through Cheung Kong Group’s ARA Asia Dragon Fund.

Citta, the new suburban mall in Ara Damansara, is 70 per cent-owned by German real estate fund SEB Asset Management and 30 per cent by property developer Puncakdana Group.

“There are a few conditions precedent that have to be met before the deal is completed and one of it is state approval,” a source told Business Times.

Messages left at the office of Mah Siew Sian, the managing director of Puncakdana, were not returned.

The open air shopping mall, with some 424,467 sq ft of nett lettable space, opened for B4business in April 2011.

The mall covers three floors, excluding the basement and rooftop, and has over 800 car park bays.

Tenants in the mall include Harvey Norman, MBO cinema, Pappa Rich, Chili’s, Julia Gabriel, RakuZen and Anjappar Restaurant.

Li, who is in the list of Asia’s richest men, is known as “Superman” in Hong Kong due to his deal-making ability.

His Cheung Kong conglomerate is one of Hong Kong’s biggest property developers and owns the world’s largest operator of container ports, among others.

Cheung Kong’s affiliate, ARA Asia Dragon Fund, bought two properties in Malaysia last year – One Mont’ Kiara in Kuala Lumpur and Aeon Bandaraya Mall Melaka – for a total of RM710 million.

In May, ARA Asia Dragon Fund won the bid for three shopping complexes – Klang Parade in Selangor, Ipoh Parade in Perak and Seremban Parade in Negri Sembilan.

It paid some RM450 million to TMW Asia Property Fund.


Read more: HK ‘Superman’ swoops on another mall http://www.btimes.com.my/Current_News/BTIMES/articles/20111222231247/Article/index_html#ixzz1hcdDFHu2