Lotustpsll contributed this article to NextInsight. He worked 32 years with a global banking group before retiring a few years ago.

Related image 

Related image

Stock price 

$1.03

52-week range

81 c – $1.17

PE (ttm)

25

Market cap

S$163 m

Shares outstanding

159 million

Dividend
yield (ttm)

1.94%

Year-to-date return

20%

Source: Bloomberg

I see Singapura Finance as a potential special situation.

The catalyst for the stock comes from the recent policy changes in the finance sector.

Liberalisation measures will spur the growth and profitability of finance companies.

Regulatory amendments, notably allowing the takeover of finance companies by foreign parties, will be interesting as I believe Singapura Finance may be keen to explore how to monetise its assets.

The licence for a finance company should be valuable in the context of a developed economy and an oligopolistic industry and there should be keen takers.

Singapura Finance is controlled by the Teo family which holds a 52% stake. The finance business started in 1950.

In 2015, another listed arm of the group, SHC Capital, sold its insurance business.

The profit trend of Singapura Finance for the past 5 financial years was weak with declining earnings per share.

pstan3.17"I think Singapura Finance has seen better days in its long history and is looking tired. It has a smaller market share compared to the competitors Hong Leong Finance and Sing Investment.

"In my view, to enhance shareholder value, it is better for Singapura Finance to dispose of its finance business and decide on a new business strategy."

-- Lotustpsll (photo)

With a book value of SGD1.60, the price-to-book of Singapura Finance is about 0.65 currently. 


The target price range for the takeover of a finance business may be 20% to 30% over book value.

This may be a tad conservative given the goodwill factor and the positive regulatory changes in the industry.

Investors of Singapura Finance will need lots of patience for this special situation to bear fruit, if ever.

You may also be interested in:


Share Prices

Counter NameLastChange
AEM Holdings3.4000.090
Alliance Mineral0.420-
AusGroup0.047-
Avi-Tech Electronics0.480-
Best World Int.1.3300.010
China Sunsine1.0400.010
CWG International0.194-
DISA Limited0.0150.001
Dutech Holdings0.340-0.005
Federal Int. (2000)0.390-
Food Empire0.695-
Geo Energy0.2700.005
Golden Energy0.4100.010
GSS Energy0.159-0.001
Heeton Holdings0.5900.010
ISOTeam0.350-
KSH Holdings0.795-0.010
Lian Beng Group0.765-
Miyoshi0.079-
Nordic Group0.570-
Oxley Holdings0.6950.025
REX International0.0650.001
Riverstone1.080-0.010
Roxy-Pacific0.5550.005
Serial System0.1660.001
Sing Holdings0.445-
Sino Grandness0.2100.005
Straco Corp.0.8650.015
Sunningdale Tech1.860-
Sunpower Group0.5500.010
The Trendlines0.1530.004
Tiong Seng0.380-
Trek 2000 Int.0.2700.005
Uni-Asia Group1.300-
XMH Holdings0.2700.030
Yangzijiang Shipbldg1.6400.060

NextInsight RSS

rss_2 NextInsight - Latest News

Online Now

We have 908 guests and no members online