Metro Holdings

[greengiraffe]

This is another value-trap counterlike Har Par, UE, Lion and many others.

Not as bad as there are key holders like Clans - Ngee An Kongsi to look after

[buddy]

There is difference here. Haw Par is a pure holding company. In this case the shareholder has created value - it has actually sold the asset & profit to book. It has stick to its business of property which probably is not the case with two. To me its more like OUE where market ignored it - till one day market realized that its shareholder actually created value at 1 Collyer Quay, 1 Raffles Place or at Meritus Mandarin.

[greengiraffe]

Likely to remain a dead undervalued stock for wrong (long) term investments. I am in it for wrong term as I agreed that tremendous value has been created especially in a extremely tough operating environment. From the owner and manager perspective, they will be unwilling to part with such hard earned money unless they see broken some day some how. The risks is low for such wrong term investments but certainly no easy money except for some miserable cashflows via dividends. Year of the Dragon - Wait long long

[freedom]

from what I see from the company, the huge cash hoard is hurting its overall return. with disposal of Metro City, Beijing, there is going to be even more cash, 500+ million. If the company can't find a better way to deploy its cash (apparently it didn't since 2009, cash and cash equivalent increased from 200 mil to 400+ mil), maybe it should return its cash to its shareholders.

[freedom]

what happened? rose by 3.5 cents all of sudden.

[yanziyang]

Transaction volume is also higher than normal.

[greengiraffe]

Appears to be a lagged reaction to DMG report issued last week. DMG highlighted Metro as a buy with target price of $0.86 this morning after issuing a report last week.

[freedom]

if Metro's intention is to trade its commercial properties, it is about time to sell its EC Mall.

it had 99+% occupancy rate and quite mature already.


As for Metro City Shanghai, Metro Tower Shanghai and GIE Tower, the buildings are old (around 20 years old) and the remaining lease is not long enough, probably it will keep them as investment properties for the remaining lease.

[greengiraffe]

You are not wrong there. Metro always have an eye for the right price. However, the right price is also driven by factors beyond Metro's control.

So far, Metro appears to be a value investor. Not that they are always correct since the Japanese venture so far like other Japanese investors has yet to seen the long awaited turnaround.

On their older "flagship" properties, it remains their intention to keep it. During the last AGM, mgt highlighted that there are options to extend their leases though it remains premature to speculate how they will be able to do it since lease rulings in China remain fluid. Nevertheless they are confident that they would have recovered their investments in these properties many times over when the lease extensions are up for fresh negotiations.

As to unlocking the value at Metro, it appears the controlling Ong family remains skeptical of embracing modern portfolio management theories. Until such time that they "see broken" or receive a price that they cannot refuse, the value will remain permanent and shareholders wealth will remain tie to the volatile daily fluctuations.

No reits, securitisation or possible returning of huge cash hoard is expected with the exception of special dividends tied to lumpy asset sales. Management while mindful of enhancing shareholders' wealth have yet to formulate any strategies let alone executing a simple accretive open mkt share-buy policies to enhance book value even further.

Such is the wrong term view that one should adopt should one consider parking money in Metro since dividend policies appear to be tied to miserable cashflow generated presently.

[freedom]

to me, Metro is wasting shareholders' money by letting it sleep in the bank for miserable interest. the least thing they can do is to repay all its loans to remove the interest cost. at least that would create more value than nothing being done.