MIT vs MLT. Which To Choose?

As mentioned in an earlier post in June, I have more funds to add to my portfolio this month.

 

Coupled with my aim this year to veer my portfolio to be less Reits-concentrated, I did two rounds of stock screening to uncover suitable counters for further study.

The screening did shown some promising counters on first glance. However I eventually decided against adding into these due to various reasons such as low trading liquidity, outlook of business, unsustainable / irregular dividend payment or the business nature simply doesn't align with my values (as is the case for one of the counters).

 

Long story short, I went back to look at my existing holdings and decided to take this opportunity to average down on couple of them.

 

I would have added into Ascendas Reit if it is not the top position in my portfolio now.

 

So I looked into Mapletree Logistics Trust and Mapletree Industrial Trust.

All three mentioned are among the fastest to recover during an upturn.

Anyway I did a quick study on the annual reports of MLT and MIT to guide my decision.

 

Sharing below summary for readers and fellow investors.

 

Notes: Data gathered from respective FY23/24 annual report. Both MIT and MLT did EFR in this period.

 

Sentiments from the findings

1) Both are well managed in terms of maintaining their portfolio occupancy, achieving positive rental revisions, increasing their distributable income and managing their debt profiles --> increasing income and well-managed debt are two of the most important attributes for any business aren't they?

 

2) However they are affected by certain macro factors e.g. in the case of MLT, China's oversupply of warehouse spaces.

 

3) Interest rates and Forex effect are and will always be something to look out for. In my opinion the management of these metrics is what set the good Reits apart from the mediocre ones.

 

4) Especially in times like now, points 2 and 3 above form the basis of analysis for Reits investment.

5) Buy into MIT if you believe in the future of DCs and don't mind the concentration risk in geography.

6) Buy into MLT if you believe in the importance of logistics and don't mind the potential slight drop in DPU yield while waiting for the chinese assets to recover.

My personal mantra has always been technology develops the world (DC) and logistics moves the world (globalisation and commerce). In this century there's simply no avoiding either.

Hence I did the best thing I can in this situation. I added to my holdings for both counters in around equal quantum - MIT @ $2.10 and MLT @ $1.26.

Quick tip: If you do not have time or do not want to go through the entire annual report, it would be useful to at least read through the Chairman and CEO message to unitholders.

Giving Back To Society (Business ESG Efforts)

Company has performed quite well in the last FY with revenue setting a new record.

 

Being in the environmental management business, our business operation itself is already covering the "E" part of our Environmental, Social and Governance (ESG) efforts.

 

To contribute to the "S" part of the ESG pillars, I have just made a donation to three selected organisations.

 

The causes selected are nature, elderly and children. All of which are close to my heart and with the first one synergistic to my business as well.

 

Now the line between personal and business is blurring. And a Pte Ltd is supposed to be a separate entity from the owner. How ironic.

 

Anyway, the total donation amounted to 0.5% of our operating profit based on our last FY. I've mentioned about this commitment in a previous post.

 

I certainly hope I can do this year after year.

Again, this post is not about showing off or haolian~ing. Rather, it serves to instill some positivities and inspire readers to contribute back to the society.

 

On a separate note, my previous personal donation was done in December last year. How time flies. Cannot keep getting dividends without giving something in return right? I look forward to December this year!

Summary of June 2024

Collected scrips + dividends from MLT and dividends from MIT and NLT this month.

Closed my Syfe portfolio with a small profit after a slightly over three years experimentation. 

Another record income achieved for my side hustle as a personal trainer.

Combining all the above, what this means is that I have a higher than usual fund for investing into my portfolio this month.

Have not added anything yet since my recent stock screening did not yield any mouth-watering prospects.

 

Price of the REITs I'm currently holding are attractive and tempting though I have mentioned earlier this year (I think) that one of my aims in 2024 is to make my portfolio less REITs concentrated.

Another option is the US market where some of my counters are inching to 100% gain.

NVDA is hot! Waiting for a pullback towards $96 region.

Will update in subsequent post for any trades made.

Summary of May 2024

Collected dividends from OCBC and DBS. 

Syfe portfolio finally turned in a small profit after so many years although it gave up the gains towards end of the month. 

Added 1,700 units of Netlink NBN Trust @ $0.84.

This is my second purchase in recent months and at the same price. 

On my sideline as a personal trainer, this month is the record in terms of income as I took on a number of new clients. 

As usual, 75% of this income stream goes to my portfolio along with any dividends collected for the month. 

Family-wise, the kids have finally gotten better from their cough and phlegm. However the PD has recommended didi to see the specialist as he is exhibiting signs of sleep apnea.

We are now waiting for the appointment date. Hopefully everything turns out fine.

Summary of April 2024

April is a month of mixed feelings in terms of investment.

At the closing today, my CLCT officially lost half of its value with capital loss of 50.35%. No thanks to the double blow of the new asset class performance and Forex effect. 

Silver lining is the dividends collected over the years that help soften the blow.

Will hold on and ride through this while continuing the dividend collections to lessen the blow.

On the other hand, my DBS and OCBC achieved capital gains of ~59% and ~61% respectively. 

Overall portfolio is still staring at 4.52% loss YTD excluding dividends.

For this month I have added 1,100 units of Ascendas Reit @ $2.66.

Will continue my strategy of making monthly purchase whenever possible.

On the US side, my BABA is at a loss of ~33%. This is somewhat compensated by my AAPL and MSFT which have gains of ~38% and ~59% respectively.

TLDR version: position sizing is important.

On the work front, it is a busy period for me this month with project executions and plenty of paperwork such as quotations to be done.

On my sideline as a personal trainer, I am getting more clients onboard as well so moving forward this income stream is expected to be more significant. 

All in all, fulfilling at work. 

Family time is still my most treasured component. Top all the above to be frank.

Kids are getting fine though their cough has been ongoing for about a month already which is starting to make me worry.

Didi just gave wifey and I a pleasant surprise on Sunday. 

I have just finished ordering our meals with the waiter when Didi suddenly tapped the waiter uncle's hand and said: "and a french fries too".

Both wifey and I laughed instantly. 

When the dishes are served subsequently sans the fries, Didi actually told the waiter uncle "the french fries please".

What a joy to hear that. That initiative to place his order and subsequently reminded the waiter of his order all on his own accord, is incredible to me because Didi is only 3 years old. 

I hope both he and his sister grow up healthy and happy. 

Summary of February 2024

Following my purchase of Mapletree Logistics Trust in January, I continued my purchasing in February when opportunity presented itself.

 

My queue for Netlink NBN Trust @ $0.84 got filled at the end of trading hours. This is an addition to existing position and an average up at that. Coincidentally, last month's purchase of MLT was also done on the 29th.

 

2929. Huat Ah!

 

This purchase price translates to a dividend yield of more than 6.2%.

 

Have been monitoring the market every day as usual. There was a dip in price earlier this month for majority of the counters in my watchlist - if I remember correctly, the dip lasted only for the trading hours before lunch on that particular day.

 

I wasn't in time to make my move then due to work. Nevertheless this week NLT presented a comfortable price for me to add and eventually I got it after queuing for two days.

 

This price is slightly lower than the $0.845 that Netlink NBN Management executive director and CEO paid for his purchase of 100,000 units on 16th Feb. 

 

Another reason is the announcement of the S$100 million investment from the government into the national broadband network upgrade.

 

While the details on how this will impact NLT's financials are not clear at this moment, I believe this NBN upgrade will at least stabilise NLT's profitability and provide visibility on its business outlook in the next 2 - 3 years.

This helps to allay my concern on the sustainability of NLT's dividend payout moving forward.

On a side note, next month should see some dividends coming in from various counters including MIT, MLT and CLCT. As usual, will reinvest into the portfolio to let compounding works its magic for me.

With that, till next time. Cheers.

Summary of January 2024

 

Blink of an eye and last day of January is here. 11 more months to end of the year. Lol..

 

Home. Kids have been falling sick one after another. Can't help but feel worried. On the other hand, got to find time to start on the spring cleaning. 10 more days to Lunar New Year.

 

Accidentally broke the handle of my metal gate recently. Damn. Didn't know a wrought iron gate handle can break so easily. Nevertheless I always believe things happen for a reason.

 

Taking this chance to change to digital lock for both gate and main door. Installation on next Wednesday.

 

Work-wise, have completed some of the projects on hand and the remaining in various stages of completion. New ones are coming in. I look forward to another great year after last year's record-breaking results.

 

For my sideline, most clients have came back from their holiday and income for this month is higher than projected. I look forward to another record-breaking year for this stream too.

 

School-wise, have finally submitted my dissertation today. That's a huge load off my shoulders. 18,000+ words, 82 pages. Don't think I have ever written such a long paper before. One of the best thing I came to realise from this Masters programme is that it re-ignited the joy of learning in me. I am even contemplating the possibility of a PhD if there is a topic that interests me enough to undergo the rigours in my 40s.

 

Investments-wise, made my first purchase of the year in Mapletree Logistics Trust at $1.53. MLT has released a good set of results recently of which I have written a review here.

 

Excluding RHT Health Trust which is going to be delisted anyway, I have 9 counters in my SGD portfolio. I am comfortable though no rush, to hold a portfolio of up to 12 counters.

 

Keppel Infrastructure Trust, Frasers Centrepoint Trust and Frasers Logistics & Commercial Trust are the counters being considered though each has its own areas of concern in my opinion.

 

Have also went through the latest results of CapitaLand China Trust and the above three counters. No time to write my thoughts on these yet. See if I can do it in the coming week.

 

Moving forward will continue my strategy of adding monthly using funds from my sideline and incoming dividends. Focus will be on:

 

1) Selected REITs whenever price weakness is present

 

2) Local banks which might present opportunities to add in 2H / 3Q this year when rate cuts happen, or even earlier since market is forward-looking. Stay nimble and monitor. If prices are attractive enough, would not mind deploying extra cash.

 

3) Non-REIT income counters as diversification

 

Till next time. Cheers.