26-05-2022, 01:30 AM
(25-05-2022, 09:58 PM)donmihaihai Wrote: EPS = NPAT/average number of shares.
Since the spin off happened in 2022, I assumed that for 2021 illustrative , share count before buyback is taken as average number of shares.
https://links.sgx.com/FileOpen/Yangzijia...leID=55216
When I look at YZJFH, I look at track record, and its record is based on lending. Post spin off, YZJFH suddenly know how to and expand to invest in all kind of stuffs. So the question is will YZJFH able to compete in 100m, 200m, 400m, long jump after spin off after spending years trying to be Joseph Schooling.
para 2.3 (a)
A Leading Investment Management Business and Debt Investment Business in Asia, in terms of the Spin-Off Group’s total AUM size and/or market capitalisation compared to other publicly listed investment management companies in Asia(1)
para 2.3 (b) Strategies and Future Plans
Upon the listing of YZJFH on the Mainboard of the SGX-ST, the Spin-Off Group intends to pare down its Debt Investment Business and continue to strengthen its position by pursuing growth via its Investment Management Business and by entering into the Fund/Wealth Management Business, underpinned by focused strategies to (a) grow its Investment Portfolio in the PRC; (b) recycle capital from the Debt Investment Business to Fund Investments in the Investment Management Business; © extend its investment footprint into Singapore by partnering prominent Fund
management companies to launch co-GP Funds; (d) diversify into fast-growing sectors and new asset classes; and (e) establish the Fund/Wealth Management Business via the acquisition of a CMS-licensed fund management company or the setting up of a fund management company in Singapore.
I do see the concerns, and I believe so do many other investors who got into this based on an investment thesis based on its shipbuilding sector. Which, in my opinion, created a rush for the exit scenario that has come to past. My considerations are the following.
1) the company is not converting all debt investments entirely to something else, but a mixture of debt investments, mezzanine debt and private equity. A large part of what they envision to do next are either what they are currently doing and related
2) they have already started on the alternative investments before the spin off and have decent but short track records
3) if you are an investor in short term debt that sits high in the capital structure, you would have to be familiar with all aspects of the debt financing including subordinated or mezzanine debt in order to manage your investment effectively. Thus, in that sense, the management of those areas are not exactly new. The metrics such as interest servicing and debt loads would be basically the same but just at a different level in the capital stack.
4) the most important part to fund managers is actually access to capital. Talent would come after in this fluid industry. Anyone who have $1bn of readily available investible cash would immediately propel to the big leagues. Take Dymon Asia for example. It’s flagship fund is a macro fund that has little to do with Private Equity, and yet over the years it has raised more than $750m in their private equity fund 1 and 2. I don’t know Dymon Asia’s internal workings but I do believe their sizing in their macro fund does help in establishing their priVate equity funds, which in the same context would not have any historical track record. Having the money solves a lot of concerns for talents in this industry, which is hopping to a shop with no money to do anything. Money is the blood that courses through the veins of fund management.
Having said the above, there is of course the risks involved with investing in YZJ FH. Then comes the question. Is the risk worth it? Investing in shares is all about risk taking and the appropriate amount of risk to take. At the current book value of 0.45 and pending catalysts from share buybacks, my personal opinion is that the risk reward ratio is very attractive. In fact it’s an opportunity that would never have happened if not for the listing for the company via introduction.
Please do your own due diligence. Any reliance on my posts is at your own risk.