In the first three parts of this 4-part series, we highlighted six chosen stocks as part of our ‘The Avengers’ investment portfolio. As we approach the last of this 4-part series, we will end the much awaited wait for the complete ‘The Avengers’ investment portfolio with the final two SG stock picks: Geo Energy and CapitaLand.
Investors Takeaway: Which SG Stock Deserves To Be Part Of “The Avengers”?
- Black Widow: Geo Energy
Geo Energy, like Black Widow, is not one to be underestimated.
Geo Energy: Putting 2018’s Miss Behind
Geo Energy will be seeing a significant ramp-up in production, according to Phillips Securities Research (PSR). In the prior year, Geo Energy saw its production miss targets due to the disruption on the loading impacted by maintenance work performed by the jetty operators. But with the commencement of newly acquired TBR mine and SDJ mine in late 2018, Geo Energy is on track to achieve at least 10 million tonnes of sales.
Securing A Good Mine Deal With Macquarie
Geo Energy managed to secure a life-of-mine offtake agreement for TBR mine with Macquarie Bank. As part of the deal, Macquarie acquired five percent of ordinary shares in Geo Energy. PSR views this deal as a favourable deal for Geo Energy to take up TBR mine at a good price. PSR is also expecting another acquisition to further boost the company’s coal reserves, given that the company is sitting on a cash balance of US$205 million. If Geo Energy is able to keep up its production output, it should be able to maintain the dividend yield in the year ahead.
Current share price $0.177
- Iron Man: CapitaLand
As one of the largest real estate groups in Asia, CapitaLand befits the role of Iron Man.
Acquiring Ascendas-Singbridge To Form A Real Estate Behemoth
With the acquisition of Ascendas-Singbridge, CapitaLand will form the largest diversified real estate group in Asia. The group will own asset classes from logistics/business parks, industrial, lodging, commercial, retail to residential with a geographical presence in more than 180 cities across 32 countries. The acquisition will turn CapitaLand into the top 10 real estate managers globally.
Becoming A Big Real Estate Player In China
Even without the expansion, CapitaLand is a giant in itself. Its recurring income now accounts for 88 percent of earnings with investment properties having doubled in mere three years. All its operating metrics are showing stable signs of growth, from occupancy to visitor arrivals/tenant sales.
China is fast becoming a key market for CapitaLand. Moving forward, CapitaLand will be developing its third Raffles City integrated development in Shanghai via its Raffles City China Investment Partners III (RCCIP III) fund. Construction is expected to be completed by June 2019. China will contribute to a significant performance for CapitaLand this year as take-up rates for La Botanica, The Metropolis, The Lakeside, and Parc Botanica are seeing healthy momentum.
Current share price $3.54
The Avengers: SG Stocks Edition (Part 3)