Bonvests HoldingsTime & date: 2 pm, 29 Apr 2014.
Venue: Sheraton Towers.
Hotel Grand Central
Time & date: 11.30 am, 30 Apr 2014.
Venue: Hotel Grand Chancellor, No. 3 Belilios Road.
The following observations of the 2 AGMs were recently posted on NextInsight's forum by Sumer, who is regarded as the resident property guru of the forum.
I ATTENDED Bonvests' and Hotel Grand Central's AGMs to gauge for myself how the major owners/managementt are like. Here are my views:
1. I am not excited with the Bonvests team. Answers given by the board were short, with mostly "noted" as the answer to shareholders' queries and suggestions.
Management indicated no interest in redeveloping Liat Towers nor giving an indicative value in its annual report on the value of Sheraton Towers. Hence, I am not keen to follow up on the counter.
Nevertheless, the undervaluation of its assets remain. Perhaps patience may still pay off for those who own the stock, but I will pass on this one.
2. Hotel Grand Central's (HGC) board is a direct opposite, a rather happy lot sharing information with shareholders generously.The 2 Orchard Road hotels should achieve Temporary Occupation Permits (TOP) next year. With 752 rooms in total, any post-TOP valuation of these assets will add to its NTA.
I reckon a 50-ct surplus could be in order. It would even be better if management is open to the possibility of selling the leasehold hotel while keeping the freehold one, as that will mean a cash inflow that could be distributed out as dividends.
Nevertheless, as this is a hotel stock, a substantial discount to its NAV is a trade mark of its breed.
Management's likability will probably keep me interested in this counter, despite its lack of immediate catalysts.
I think the 2 main speakers were 2 of the 3 Tan brothers: Tan Eng Teong, Teck Lin and Eng How. A woman who spoke, I believe, could be Tan Hwa Lian or Hellen Tan, or Michelle Tan (all are daughters of either one of the 3 brothers).
I believe Anthony Poh, the group accountant, also spoke.
I thought I could Google their pictures later, but apparently it's hard to find them, so I am not too sure who exactly were the ones who spoke. Suffice, perhaps to say, that I had a good impression of all of those who spoke.
I notice Hotel Grand Central has many loyal long-time retail shareholders too, and they appear happy with management, a sign perhaps that they have been well looked after over the years.
For eg, I note that the company has dished out consistently good dividends. Even though earnings were below 3ct per share last year, HGC dished out 5ct dividend, allowing many to take scrip dividend and increase their stake in the company while HGC saves on cash payouts.
Compare HGC with some listed companies which consistently give the excuse that they "need money for expansion" for not paying better dividends.
Note: I am vested in HGC, but not a lot as it's, after all, a hotel stock, and catalysts are few.
Hotel Grand Central has a market cap of S$716 million and a 4.2% dividend yield. Chart: FT.com |
Lotustpsll says: Bonvest's BOD may not be in tune with the times as to how to positively engage shareholders. Perhaps, they don't need to, given the low level of minority shareholding - sadly, such cockiness or lackadaisical attitude is often seen. Sumer, how old (do you think) is Henry Ngo?
I will stay the course and bid my time. Diversity says: Yes, Chairman and his brother, Tan Teck Lin, are unassuming. |
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