Friday, May 25, 2012

Reminder: Saizen REIT Warrants expiring soon

Just a friendly reminder.

The warrants for Saizen REIT expires on 1st June 2012. 

You may want to see how to exercise your warrants from this link:

At the moment, my average cost of 0.161 is in the red. Dividends of 0.0189 has been received so far. :(

What do I expect after 1st June 2012?
I'm pretty sure that Saizen will follow in the footsteps of AIMSAMPIREIT. There should be a share consolidation soon. 

I'm prepared for a 5 for 1 or 10 for 1 share consolidation. I'm expecting a 5 for 1.

Peace out.

In case anyone is interested, here's a video on Saizen from investor central

1 comment:

  1. To share what I think of Saizen REIT.

    1. The Mar 11 earthquake that hit Japan, while releasing stress in that area, has increased the risk of earthquakes in other areas of Japan. Of note is the recent study by Tokyo University that concluded that Tokyo's risk of an earthquake (greater or equal to 7) within 30 years are as high as 98%. In the worst case scenario, a quake of magnitude 7 can hit southern part of Tokyo by 2016. Saizen recently picked up a property in Denenchofu, Ota-ku (south, built 2005)and Hatchobori, Chuo (central, built 2004). They are relatively new buildings and will fall into the steel reinforced concrete category. Will that help them weather any earthquake better? Following on, 50.8% of Saizen properties are >20 years old. We can monitor Japan earthquake catastrophe bond investors to see what they think. For me, risk is on.

    2. Saizen issued 497,185,362 warrants in 2009. There are 21,973,622 invalid warrants (4.4%). How will they use the proceeds? Pare down the loans (?) - Saizen has a loan portfolio of 8 more loans with the next one due Mar 15. Acquire more properties? S$20.1m has been used for loan repayment. Let us see what they do with the remaining.

    3. On 30 May 12, Saizen proposed a unit buy-back.

    4. Saizen investors are hoping for a recovery in the Japanese property market and a change in the country's fortunes. Much will depend on the government's success at rolling out long term plans that can be adhered despite the frequent changing of governments. I am waiting to see if they will wake up and realise they need sustained immigration to combat their decline in the population.

    5. The volatility of the Yen can mean high earnings one half year and lower another. We are also facing deflation risks.

    6. In the last report, their NAV is S$0.30. Taking into account dilution of warrant conversion, we will still be buying in below NAV although with higher risk of earthquakes and the downgrade on Japan. Feels like buying a Japanese property below valuation but knowing that valuations may drop?

    I am vested and hope that Saizen steadies the income stream.


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