As per my post on Dapai, I mentioned I was not too keen on Dapai's business but was impressed at it's financials. Hence I took a small position on Dapai, with 6 lots @ $0.185. We'll see what happens when it releases it's 4Q 2010 results in Jan 2011.
I also vested myself into First REIT @0.700, giving myself a 9.00% dividend yield for 2011, using the 6.4c per unit guideline from the manager.
I will be setting aside a small amount, probably $1k to try CFD's out. IG Markets has a promotion whereby people new to CFD's will be able to pay only $3 in commission their first 2 weeks playing CFD, then $7.50 the next 2 weeks, then $15 the next 2 weeks. After that will be normal $25. (City Index charges $10 only ....)
With my remaining money, I'm not whether to invest in commodities/oil firms here in Singapore, like GoldenAgri, Indofood Agri, Olam or Mewah, or pump it into the American market with Archer Daniels Midland (a dividend aristocrat), ExxonMobil (another dividend aristocrat) or PetroChina ADR. PetroChina's dividend yield is lower than XOM, However there is a 30% withholding tax levied on all American stock dividends. I'm not sure whether PetroChina is liable for ths 30% Tax. Some other blogger posted about him having a Telefonica ADR and paying only Spain's withholding tax. Hmm...wonder what's China's withholding tax rate for dividends? Shall go find out.
I recently found out that PetroChina is the world's largest company by market capacity and ICBC is the world's largest bank by market cap, without having a significant overseas presence...wow! Huge testament to China's might.
In other news, the Pound Sterling has depreciated again vs. SGD. Great!
Hi,
ReplyDeleteDapai was once China Zaino. I would caution against it if you are based on Fundamentals. Reasons:
1) S-share. They could cook their books nicely, hence setting up a value trap.
2) The change of name was likely to remove the China stigma. I'm not sure of their intentions.
I myself cut loss on China Sky recently after holding for 1.5 years. $500 loss. Bought into First REIT at $0.665 too.
As for the Dividend Aristocrats based in the US, do take note that as an overseas investor, you are also subjected to withholding taxes on dividends declared. If you buy through POEMS, you are also subjected to an annual custodian charge, and some of the dividends are also taken by POEMS.
DBS Vickers does not have custodian charges at the moment, but dividend taxes still apply.
These taxes will reduce your percentage yield.
Hi JW
ReplyDeletethanks for visiting.
Yep, I know that I'm subject to the withholding taxes. I wrote it up there! haha. anyway, I have an optionsxpress account which has no custodian charge. and cheaper brokerage to boot.
that's why im thinking of petrochina ADR, but i cant seem to find PRC's rate of witholding taxes.
Regarding Dapai, the official reason for the name change was to indentify with it's product more...Since their retail brand is called dapai they decided to change it to the same brand name.
Regarding cooking the books, do you mean like 1+1=3? haha. has any locally listed firm
been caught doing it?
Hi Isaac,
ReplyDeleteSome S-chips cook the books not exactly by doing 1+1=3 as it's very obvious but maybe, 1+1=2.1.
I myself divested from Dapai due to certain reasons: http://financiallyfreenow.wordpress.com/2010/11/04/goodbye-dapai/
Hi FFN,
ReplyDeleteRegarding cooking the books, I know the accounting firms are somewhat notorious for bending the rules, but pardon me if i sound naive, would they risk their practice for a small cap company like Dapai? Dapai's accountants are Grant Thornton, and I'm sure they've got bigger books to "cook" than Dapai.
Like e.g. I can understand if Arthur Andersen was willing to break the rules for mega cap Enron, but...Dapai?
I'll just have to trust the integrity of the management for now...
Also, I've commented on your reasons for divesting on that link.
ANyway, Merry Xmas!
Hi Isaac,
ReplyDeleteThe books are cooked by the management itself. The auditor's might overlook it and investors like us must be prudent enough.
Merry Xmas!
Hi Isaac,
ReplyDeletemy idea of cooking the books involves on whether the cash/profit is really there, not 1 + 1 = 3.
To the auditors and to us, it's still 1 + 1 = 2. That is what will be reported. But are the 1s really there?
There are two ways to learn your lessons:
ReplyDelete1) Learn it the hard way yourself by hurting yourself.
or
2) Learn it the easier way by seeing why the other guy was so hurt
Both are the right ways to learn. You decide.
Hi JW and Uncle Creatwealth8888,
ReplyDeletethanks for the insight. I'm just going to have to trust the management in this case. Will be scrutinizing the company's next financial report due next month/February.
Do you guys know of any cases of accounting irregularities in Singapore listed companies?
Issac,
ReplyDeletelook at FibreChem and FerroChina.
Hi guys,
ReplyDeletethanks for all the advice. I was just reading on the net about China Aviation Oil and FibreChem.
I just pray that Dapai's management team has some integrity.
I will research more and post on S chip scandals soon.