Wolf Money(SBS Transit Ltd)

-

There was a new addition to The Lone Wolf Fund this month. I bought just about enough shares in SBS Transit to generate enough dividend to cover my family’s public transport cost. The recent 7% increase in public transport fares which workout to be around 10c-11c extra per trip, will have a positive impact on SBS Transit Rail’s bottomline as the company co share fare revenue with LTA under the new rail financing framework for DTL and NEL. DBS research estimates the fare hike will improve SBS Transit’s bottomline by $14.7m. The newly introduced fare formula helps address the drop in daily commuters due to work from home trend reducing growth in passenger numbers. The upward adjustment of fares increase SBS Transit Rail revenue by close to $21m a year with 15.6% of the outstanding fare increase carrying over to next year fare review. The government pays a grant to the public transport companies for the deferment of the outstanding fare increases.

Rail ridership in August reached an all time-high, providing a bedrock for stable revenue. The company is in a net cash position to a tune of plus and minus $340m, equivalent to $1.10 cash per share or 40% of stock price. 


(Source: SBS Transit)


SBS Transit will be celebrating their 50th anniversary this year. I am hopeful of a special dividend given to shareholders as a token of appreciation for their continued support. The strong cash flow is supportive of higher normal dividend payout. We shall see. Finger crossed.

Risk includes higher oil prices which affect the cost of electricity but the downside risk is capped as diesel cost is absorbed by LTA. Another risk involves failure to win bus packages. Currently, they are not subjected to tender risk for the next couple of years as they had just won the Bukit Merah bus package in August this year for next 5 years, with the option for LTA to extend the package for another 2 to 5 years at the end of the contract. Remember bus doesn’t come equip with rocket engine, do expect the share to move slowly at 50km/hr. God bless. 


Please consider following us on telegram for the latest update on Lone Wolf investor by clicking on the link below. No form filling, no payment required, no collection of data, no data mining, no hard selling, no obligation. 

https://t.me/joinchat/oCgkD3sQFRMzMWM1



Disclaimers 

All investments is highly speculative in nature and involves substantial risk of loss. We encourage our reader to invest very carefully. We also encourage reader to get personal advice from your professional investment advisor and to make independent investigations before acting on information that we publish. Much of our information is derived directly from information published by companies or submitted to governmental agencies on which we believe are reliable but are without our independent verification. Therefore, we cannot assure you that the information is accurate or complete. We do not in any way whatsoever warrant or guarantee the success of any action you take in reliance on our statements. All information provided are for education only. Buyer beware, do you own due diligence.

Comments

Post a Comment

Popular posts from this blog

Wolf Money(Portfolio update for end April 2024)part 1

-
Image
  (Image credit The Star Media) (Swamp of people going into Shenzhen) Bye Singapore! Hi Malaysia, 2026 This write-up was inspired by a video posted on YouTube. The video talks about Hong Kong hollowing out by Shenzhen. The recent phenomenon of Hong Kongers going to Shenzhen to play, eat and stay is gathering pace with close to 2 millions making the crossing to Shenzhen during the recent Easter Holiday. That is close to 30% of the current HK population leaving for Shenzhen. With deflation taking root in China, things are much cheaper in Shenzhen. The poor economy in HK is another push factor with Hong Kongers trading down their consumption. One traveller from HK mentions his spending in the mainland only cost him 1/3 of the usual price he paid in Hong Kong. Hong Kongers are shopping at Sam’s Club in Shenzhen buying everything from groceries to electronics. The commentator interviewed restaurants and shop owners in HK, most experienced a 30% drop in sales during the holiday.  *The video
Read more

Wolf Money(The Demise of The Singapore Stock Market)

-
Image
  (Credit: Yahoo Finance; Last index high of 3900 in 2007, 16 years and counting. Lost decade of Singapore Market) I spent two nights thinking about this write up since it is a subject close to my heart. The passion and concern I had for our stock market are real. I hope SGX can see my commentary in a positive light. It is about solving problem that matters, no witch-hunting was intended. During my last monthly update. I am critical about SGX for not doing enough to promote the vibrancy of our stock market. After the blog, I have been getting more SGX senior executives looking at my LinkedIn profile. I hope people at SGX can see it as constructive criticism. I want to make my point of view clear before anyone get an impression that I am grinding my axe on our stock market. I love Singapore market, I am also a bull on Singaporean companies. How could I not love our stock market where I allocate most of my investment? The declining interest in our stock market did not happen overnight, i
Read more

Wolf Money(portfolio update for end Aug 2023) part 1

-
Image
  (Image credit : Netflix ; Lily Collins in Emily in Paris) (Personal photo : The iconic Arc de Triomphe) (Personal Photo: The street where wallet got murdered) Le Non-Dit Des Sociétés Cotées(The unspoken language of listed companies)*pardon me, google translate In the popular Netflix romcom drama, Emily in Paris, Lily Collins portrayed Emily Cooper, an American marketing executive sent by her US company to their subsidiary in Paris to give an American perspective to marketing. Without knowing a word of French or local culture, she embarked on a difficult journey of communicating with her colleagues and clients, in which it resulted in miscommunication and her being the butt of the joke. Emily assumed everyone in Paris could or wanted to communicate in English. She was forced to learn the language in class so as to communicate well with her colleagues and clients. It is important to understand the language of choice in the area one operates so as to be able to communicate effectively i
Read more