Sunday, February 26, 2017

SingPost (S08)

Draft: 2/14/2017

Source: SingPost Q3 report.

Updated: 2/26/2017, Market size:3.16b, PB 1.9, Price $1.39/share

Another blog by ASSI attractive my interest. Alright, in fact I bought SingPost some time ago; and received an email from my broker on Monday when SingPost's price dropped by 6% after its over-the-weekend profit warning announcement.

eCommerce acquisition: TradeGlobal in Nov 2015 is a flop, merely a year more, mgmt is talking about impairment of that whole acquisition.

Who made that corporate purchase decision? How can it be in this short period of time, two key customers of TradeGlobal one filed for Ch 11, the other went for in-source.

What does Alibaba value SingPost
- Alibaba invested $86.2m on Oct 27, 2016 for 34% stake in Quantium Solutions. Value QS at S$254m. QS revenue Q3 16/17 is 29.5m; Singpost Logistics segment Q3 16/17 is 171.3m(OP 5%); Singpost Q3 16/17 revenue: 369m(OP 10%).
=> SingPost: ~3.1b
- Alibaba  invested $187.1m on Jan 11, 2017 for 4.2% of SingPost($1.74/share)
=>SingPost: ~4.4b
- Alibaba invested $312.5m for 10.35% of SingPost by Jul 2014.
=>SingPost: ~3b

Value Catalyst
Only when Tradeglobal stops bleeding.

Turn around plan
Entry price not attractive, average down.

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