Kep Infra Tr    Last:0.52    +0.01

KIT

If I were a billionaire, I would just own it and run it myself.
If I weren't, I'd gather a bunch of like minded people and set up an equity fund to buy up and manage the pipeline or gas plant.

But alas, I have no energy to do that now, so I make believe I own a gas plant by becoming a minor shareholder in a trust that owns one.

prophetjul      ( Date: 29-Aug-2024 09:31) Posted: Problem is how can you own a gas pipeline on your own?  :) Or a power generation plant?  This trust gives us an opportunity to own that.  MrBear12      ( Date: 29-Aug-2024 09:19) Posted: That's probably true of almost all asset managers. Assets increase, returns not necessarily. Assets increase 200%, returns increase only 20 percent for some. Many companies in Singapore do not raise capital in an efficient way. We have a lot to learn how to raise new capital. If we want to own Assets, best to have our own company to hold these assets and manage them. Paying someone else to manage our assets is usually gonna be bad

 

Yes. So that the new shares do not earn dividends before 5 Sept.

lictenau      ( Date: 29-Aug-2024 09:22) Posted: 10:23 PM EDT, 08/26/2024 (MT Newswires) -- Keppel Infrastructure Trust (SGX:A7RU) has disclosed the record date for its stub distribution related to the period commencing July 1 and ending just before the issuance of placement units, according to a Tuesday filing on the Singapore Exchange. The register of unitholders will close at 5:00 pm on Sept. 4, to determine entitlement to the distribution. Unitholders registered by this deadline will receive SG$0.007 per unit. The last trading day on a cum basis is Sept. 2, with ex-trading starting on Sept. 3. The stub distribution is exempt from Singapore income tax and is expected to be paid on Sept. 18. Is this to align the distribution so that the new placement will start on equal footing with all others holding the counter?

 

Problem is how can you own a gas pipeline on your own?  :)
Or a power generation plant? 
This trust gives us an opportunity to own that. 

MrBear12      ( Date: 29-Aug-2024 09:19) Posted: That's probably true of almost all asset managers. Assets increase, returns not necessarily. Assets increase 200%, returns increase only 20 percent for some. Many companies in Singapore do not raise capital in an efficient way. We have a lot to learn how to raise new capital. If we want to own Assets, best to have our own company to hold these assets and manage them. Paying someone else to manage our assets is usually gonna be bad. prophetjul      ( Date: 29-Aug-2024 09:11) Posted: It does feel like this management is not very competent as far as fund raising in concerned. How is it that they do not have th funding ready for the Ventura buy? Feels like they are just increasing the AUM for obvious reasons of manager' s fees rather than shareholders value enhancement. At least at thsi stage. I am a relatively new shareholder. i am attracted to their assets. Just not too suer about their management though.

 

10:23 PM EDT, 08/26/2024 (MT Newswires) -- Keppel Infrastructure Trust (SGX:A7RU) has disclosed the record date for its stub distribution related to the period commencing July 1 and ending just before the issuance of placement units, according to a Tuesday filing on the Singapore Exchange.

The register of unitholders will close at 5:00 pm on Sept. 4, to determine entitlement to the distribution.

Unitholders registered by this deadline will receive SG$0.007 per unit. The last trading day on a cum basis is Sept. 2, with ex-trading starting on Sept. 3. The stub distribution is exempt from Singapore income tax and is expected to be paid on Sept. 18.

Is this to align the distribution so that the new placement will start on equal footing with all others holding the counter?

 

That's probably true of almost all asset managers. Assets increase, returns not necessarily. Assets increase 200%, returns increase only 20 percent for some.

Many companies in Singapore do not raise capital in an efficient way. We have a lot to learn how to raise new capital.

If we want to own Assets, best to have our own company to hold these assets and manage them.
Paying someone else to manage our assets is usually gonna be bad.

prophetjul      ( Date: 29-Aug-2024 09:11) Posted: It does feel like this management is not very competent as far as fund raising in concerned. How is it that they do not have th funding ready for the Ventura buy? Feels like they are just increasing the AUM for obvious reasons of manager' s fees rather than shareholders value enhancement. At least at thsi stage. I am a relatively new shareholder. i am attracted to their assets. Just not too suer about their management though.

 

It does feel like this management is not very competent as far as fund raising in concerned.
How is it that they do not have th funding ready for the Ventura buy?
Feels like they are just increasing the AUM for obvious reasons of manager' s fees rather than shareholders value enhancement. At least at thsi stage.
I am a relatively new shareholder.
i am attracted to their assets. Just not too suer about their management though. 

 

We are on the same boat.

We should be fine.

We have almost a million gas customers in Singapore.

Our business is more than 100 years old.

I never dreamt when I was a child passing by kallang gas works I'd have a share in their gas business.

Who am I now?

A gas business owner!

Proud of it.

 

I too came from the days of Cityspring, in fact I entered when Cityspring IPO' ed,... gotten in on the high. I cutloss somewhere along the way.Then I re-entered KIT a few years ago. Thank you for the good talk, bro,...
 

MrBear12      ( Date: 28-Aug-2024 21:01) Posted: You are faring better than me 16 years ago when I bought this one. It was then known as citysprings. The GFC hit and I was 40 plus percent in the red after less than a year. I held on for another 15 years plus. And now have almost 100% returns. One must be patient to earn for this one. chengwh1      ( Date: 28-Aug-2024 19:37) Posted: Thank you. My hldg price is 51.18c. When I looked at my Dashboard now, the ' Profit/Loss%' column shows a red-colored 11.10% with a closing price today of 0.455. If the price stays at this level or falls further, my dpu earned at 7+% will not be able to cover my capital loss. Any comments then

 

You are faring better than me 16 years ago when I bought this one. It was then known as citysprings. The GFC hit and I was 40 plus percent in the red after less than a year.

I held on for another 15 years plus. And now have almost 100% returns.

One must be patient to earn for this one.

chengwh1      ( Date: 28-Aug-2024 19:37) Posted: Thank you. My hldg price is 51.18c. When I looked at my Dashboard now, the ' Profit/Loss%' column shows a red-colored 11.10% with a closing price today of 0.455. If the price stays at this level or falls further, my dpu earned at 7+% will not be able to cover my capital loss. Any comments then ? MrBear12      ( Date: 28-Aug-2024 14:03) Posted: My average buy price is 52 cents a unit

 

Thank you. My hldg price is 51.18c. When I looked at my Dashboard now, the ' Profit/Loss%' column shows a red-colored 11.10% with a closing price today of 0.455. If the price stays at this level or falls further, my dpu earned at 7+% will not be able to cover my capital loss. Any comments then ?

MrBear12      ( Date: 28-Aug-2024 14:03) Posted: My average buy price is 52 cents a unit. chengwh1      ( Date: 28-Aug-2024 14:01) Posted: Thank you, again, Bear,... may I know : what is your current holding price for KIT ? What you' ve written is certainly very helpful...

 

My average buy price is 52 cents a unit.

chengwh1      ( Date: 28-Aug-2024 14:01) Posted: Thank you, again, Bear,... may I know : what is your current holding price for KIT ? What you' ve written is certainly very helpful.... MrBear12      ( Date: 28-Aug-2024 13:36) Posted: Price should not fall as DPU increases, generally that shld be the case. But KIT is one exception. I saw KIT price fall steadily even when dividends were very stable for the most of its life on SGX. Two reasons can explain this. One: There have been a number of private placements over the last 5-6 years, three I remember. Share dilution due to significant share base enlargement at prices slightly below market prices. Two: KIT does not seem to be a profit retaining company. It hardly has any profits. I don' t see it expanding organically. Expansion is mainly by borrowing or issuing new equity, though I do see some cash from ops deployed to acquisitions of subsidiaries. Total shareholder return is measured by capital gains plus income gains. So as long as the net return is say 4-6% annually, I suppose it is a fair stock. My records show an annualised return of about 4.25% per annum over the past 16 years. Nothing to shout about. What is amazing is that this stock has one of the most steady distributions over the last ten years compared to any other stock. Other stocks' dividend fluctuate, but this one, no. Not a growth stock for sure, unless you re-invest your dividends regularly, which will boost your returns annually. But enough to function as a kind of annuity

 

Thank you, again, Bear,... may I know : what is your current holding price for KIT ?
What you' ve written is certainly very helpful....

MrBear12      ( Date: 28-Aug-2024 13:36) Posted: Price should not fall as DPU increases, generally that shld be the case. But KIT is one exception. I saw KIT price fall steadily even when dividends were very stable for the most of its life on SGX. Two reasons can explain this. One: There have been a number of private placements over the last 5-6 years, three I remember. Share dilution due to significant share base enlargement at prices slightly below market prices. Two: KIT does not seem to be a profit retaining company. It hardly has any profits. I don' t see it expanding organically. Expansion is mainly by borrowing or issuing new equity, though I do see some cash from ops deployed to acquisitions of subsidiaries. Total shareholder return is measured by capital gains plus income gains. So as long as the net return is say 4-6% annually, I suppose it is a fair stock. My records show an annualised return of about 4.25% per annum over the past 16 years. Nothing to shout about. What is amazing is that this stock has one of the most steady distributions over the last ten years compared to any other stock. Other stocks' dividend fluctuate, but this one, no. Not a growth stock for sure, unless you re-invest your dividends regularly, which will boost your returns annually. But enough to function as a kind of annuity. chengwh1      ( Date: 28-Aug-2024 13:04) Posted: Thank you,..Why would there be price depreciation if dpu continues to grow and yield is so good now ? Price shld at least stay put, if not grow, right ? Emm, and then... what' s the pt of having a good yield and earning a ' good' dpu when we suffer capital loss in exchange ?

 

Price should not fall as DPU increases, generally that shld be the case.
But KIT is one exception.
I saw KIT price fall steadily even when dividends were very stable for the most of its life on SGX.

Two reasons can explain this.
One: There have been a number of private placements over the last 5-6 years, three I remember. Share dilution due to significant share base enlargement at prices slightly below market prices.
Two: KIT does not seem to be a profit retaining company. It hardly has any profits. I don' t see it expanding organically. Expansion is mainly by borrowing or issuing new equity, though I do see some cash from ops deployed to acquisitions of subsidiaries.

Total shareholder return is measured by capital gains plus income gains. So as long as the net return is say 4-6% annually, I suppose it is a fair stock. My records show an annualised return of about 4.25% per annum over the past 16 years. Nothing to shout about.

What is amazing is that this stock has one of the most steady distributions over the last ten years compared to any other stock. Other stocks' dividend fluctuate, but this one, no.

Not a growth stock for sure, unless you re-invest your dividends regularly, which will boost your returns annually. But enough to function as a kind of annuity.

chengwh1      ( Date: 28-Aug-2024 13:04) Posted: Thank you,..Why would there be price depreciation if dpu continues to grow and yield is so good now ? Price shld at least stay put, if not grow, right ? Emm, and then... what' s the pt of having a good yield and earning a ' good' dpu when we suffer capital loss in exchange ?   MrBear12      ( Date: 28-Aug-2024 12:59) Posted: Business is well-diversified and stable. I do not see reduction in DPU. Only a small increase. Much depends on the cash generated from ops.  Yield should be near 7-8%. But anticipate 0.5-1% depreciation in price over the long term

 

Thank you,..Why would there be price depreciation if dpu continues to grow and yield is so good now ? Price shld at least stay put, if not grow, right ?

Emm, and then... what' s the pt of having a good yield and earning a ' good' dpu when we suffer capital loss in exchange ?
 

MrBear12      ( Date: 28-Aug-2024 12:59) Posted: Business is well-diversified and stable. I do not see reduction in DPU. Only a small increase. Much depends on the cash generated from ops.  Yield should be near 7-8%. But anticipate 0.5-1% depreciation in price over the long term. chengwh1      ( Date: 28-Aug-2024 12:48) Posted: Just an opinion here : I think we are more concerned abt what happens to the dpu in the coming qtrs, especially if it' s sustainable or not,... with the reducing distributable income (tho' there are mentions of one-offs, etc,...). Yield at the present is not impt anymore with the way things are happening

 

Business is well-diversified and stable. I do not see reduction in DPU. Only a small increase.
Much depends on the cash generated from ops. 
Yield should be near 7-8%.
But anticipate 0.5-1% depreciation in price over the long term.

chengwh1      ( Date: 28-Aug-2024 12:48) Posted: Just an opinion here : I think we are more concerned abt what happens to the dpu in the coming qtrs, especially if it' s sustainable or not,... with the reducing distributable income (tho' there are mentions of one-offs, etc,...). Yield at the present is not impt anymore with the way things are happening. Lightyear      ( Date: 28-Aug-2024 11:55) Posted: What's your entry price ? That would also determine if the "dividend" is good too

 

Just an opinion here : I think we are more concerned abt what happens to the dpu in the coming qtrs, especially if it' s sustainable or not,... with the reducing distributable income (tho' there are mentions of one-offs, etc,...). Yield at the present is not impt anymore with the way things are happening.

Lightyear      ( Date: 28-Aug-2024 11:55) Posted: What's your entry price ? That would also determine if the "dividend" is good too MrBear12      ( Date: 27-Aug-2024 11:29) Posted: Thanks alignment. I was a little disappointed with the stub dividend of .7 cents. That is dividend for 66 days in 2 H 2024 -- 01july to 4 Sept 2024. If I take 365/66×0.7cents I get only just under 3.9 cents full year. Not exciting, unless I have made some error

 

Good discussions here.

It is important to note here that the proforma calculation for the dividend payout post-all actions here is strongly accretive at 4.1% !

Excerpt from BT : https://www.businesstimes.com.sg/companies-markets/keppel-infrastructure-trust-proposes-private-placement-raise-least-s200-million

If the acquisition, issue of perpetual securities and placement had been completed on Jan 1 this year and KIT held the acquired interests through to Jun 30, pro forma distribution per unit (DPU) for H1 FY2024 would stand at S$0.0203, which is 4.1 per cent higher than its actual DPU of S$0.0195. FY2023 DPU would stand at S$0.0409 based on pro forma calculations, which is 6 per cent higher than its actual DPU of S$0.0386.

KIT' s loan is either fixed or hedged at ONLY 60+%. The remaining 30+% will enjoy lower interest expenses when interest rates start to pullback. This is a further positive effect created when taken in context with the proforma calculations against 1HFY24 results, meaning the dpu accretion post-activities will be higher than 4.1%,....

Did I miss something ?

investshare      ( Date: 27-Aug-2024 22:23) Posted: You forget to add the effect of dilution. DPS should be even lower post dilution. MrBear12      ( Date: 27-Aug-2024 11:29) Posted: Thanks alignment. I was a little disappointed with the stub dividend of .7 cents. That is dividend for 66 days in 2 H 2024 -- 01july to 4 Sept 2024. If I take 365/66×0.7cents I get only just under 3.9 cents full year. Not exciting, unless I have made some error

 

52 cents was my entry over 16 years

Lightyear      ( Date: 28-Aug-2024 11:55) Posted: What's your entry price ? That would also determine if the "dividend" is good too MrBear12      ( Date: 27-Aug-2024 11:29) Posted: Thanks alignment. I was a little disappointed with the stub dividend of .7 cents. That is dividend for 66 days in 2 H 2024 -- 01july to 4 Sept 2024. If I take 365/66×0.7cents I get only just under 3.9 cents full year. Not exciting, unless I have made some error

 

What's your entry price ? That would also determine if the "dividend" is good too

MrBear12      ( Date: 27-Aug-2024 11:29) Posted: Thanks alignment. I was a little disappointed with the stub dividend of .7 cents. That is dividend for 66 days in 2 H 2024 -- 01july to 4 Sept 2024. If I take 365/66×0.7cents I get only just under 3.9 cents full year. Not exciting, unless I have made some error. Alignment      ( Date: 27-Aug-2024 11:22) Posted: Speaking for myself, I have been openly critical about various aspects of the Ventura deal (I am not going to repeat myself, anyone interested can scroll down on this chat). At the time of the acquisition KIT stated its intent to fund the acquisition via a placement (part of which potentially may have been a rights issue) at around $0.47, whereas it now seems the funding will come from a smaller placement at a lower price combined with a perp yielding 4.9%. On balance this is a better outcome than initially promised, although I will not go so far to say my previous concerns have been satisfied. Personally I would have wished the EGM vote to approve the equity raise to have failed in order to teach management a lesson to show shareholders more respect but sadly that was not to be, and I have to recognise shareholders themselves voted for it.   On the bigger picture (and in my mind the most important thing) of DPU progression, the proposed stub dividend of $0.007 for two months implies a FY DPU of $0.042 which is about 8% higher than the implied annualised 1H24 DPU. That is clearly good news.   Life is not black and white. Similarly, not everything management does is good and not everything is bad. You just have to decide whether there is more good than bad and whether to take the rough with the smooth. I would argue here it is (much) more smooth than rough and overall things look very positive.

 

Trustee-manager?s fees in 1H 2024 were S$15.2 million higher than the corresponding period last year. This is attributable to higher performance fees in respect of increase in DPU in FY2023 as compared to FY2022 following the declaration of 4Q 2023 DPU in January 2024 and acquisition fees incurred for acquisition of Ventura. From 1H 24 report

MrBear12      ( Date: 28-Aug-2024 10:00) Posted: Increase in AUM across the board. prophetjul      ( Date: 28-Aug-2024 09:22) Posted: BTW do you know why the management fees have increased so much in the last half year?  Is it solely because of Ventura