If you looked through my previous postings on SP Setia, although I do like SP Setia, I did also mention of it being a short term shareholding. SP Setia will remain to be a great developer but the fact that Tan Sri Liew has been buying land (possibly through proxy like his son and friends) while diluting his stake in SP Setia probably convinced me to sell. I still do not think he is SP Setia, but the fact that it is a pure developer and me being not too comfortable with a full-fledged property developer at this stage, allows me to sell.
Yesterday, it was a small opportune time for me to pick up some of the stocks which may have dropped to their original level when I may have started to look some of the stocks with more in-depth.
This I believe, is due to the jittery effect of the general election which may chart the future of Malaysia when the market is reopened this Monday. Anyway, as always I have mentioned of non-government aligned stocks and I will still keep to that mindset. Time Dotcom and Malaysia Airport are not really government aligned stocks - they are businesses which are largely owned by GLCs. Time Dotcom is managed and to a large extent owned by a group of individuals who happened to run the company but they are majority owned by Khazanah. So is Malaysia Airport which is controlled by the government.
Anyway, over the past one month I have looked and relooked at a company called Wing Tai Malaysia. It is a decent developer with some slight diversification - fashion retailing. Currently, the contribution for the group is around two third property and one third retail. While I am ok with property business, I am as well attracted to its retail arm despite it being a smaller contributor. For its property, it is one of the more prominent developer in Singapore with some projects in Hong Kong and China, but these are held through different listed entity. Hence, it is not a newcomer when comes to property development. Much of its projects are medium and higher end in Malaysia now but its landbank in mainland Penang will cause it to build more affordable housing.
As for the retail business, this is where I think it will achieve more consistent results from. It has more than 10 brands under its arm and the more popular ones are TopShop and its joint venture into Uniqlo. Since 1 - 2 years ago, the government has done away with taxes on clothing and luxurious retail goods. This, I believe has cause brands such as H&M, Uniqlo, Debenhams to be aggressive in the Malaysian market - which from this is good for Wing Tai Malaysia. On its background, you would know that Wing Tai Malaysia was called D&P (Dragon and Phoenix). From my experience, it was a clothing manufacturer reinventing itself into brand retailer, which it to an extent has done decently well. This reinvention of itself makes me believe of the group, of its ability and I have decided to purchase 4200 units at RM1.89 per unit.
You can look at my update on my portfolio here.
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