The Tang Group ventures into the S-Reit sector

INSTITUTIONS were net buyers of Singapore stocks over the five trading sessions through to May 30, with S$108.4 million of net institutional inflow, as 20 primary-listed companies conducted buybacks by way of market acquisition with a total consideration of S$37.9 million.

Leading the net institutional inflow over the five sessions were Yangzijiang Shipbuilding : BS6 0%, UOB : U11 0%, Singapore Exchange : S68 0%, OCBC : O39 0%, DBS : D05 0%, Sats : S58 0%, Singtel : Z74 0%, Singapore Technologies Engineering : S63 0%, Seatrium : 5E2 0% and Thai Beverage : Y92 0%.

Meanwhile Mapletree Pan Asia Commercial Trust : N2IU 0%, Singapore Airlines : C6L 0%, Mapletree Logistics Trust : M44U 0%, Jardine Cycle & Carriage : C07 0%, CapitaLand Ascendas Reit : A17U 0%, Sembcorp Industries : U96 0%, UOL Group : U14 0%, Jardine Matheson Holdings : J36 0%, Mapletree Industrial Trust : ME8U 0%, and Keppel Reit : K71U 0% led the net institutional outflow over the five sessions.

The five trading sessions saw more than 80 changes to director interests and substantial shareholdings filed for around 40 primary-listed stocks. Directors or CEOs filed 19 acquisitions, and no disposals, while substantial shareholders filed six acquisitions and six disposals.

ARA US Hospitality Trust

The Tang Group comprises Gordon Tang, Celine Tang, Tang Jialei, Tang Jialin, Acrophyte Pte Ltd, Acrophyte Asset Management Pte Ltd and Acrophyte Ltd. The Tang Group is seeking to acquire the 100 per cent equity interest in the managers of ARA US Hospitality Trust : XZL 0% (ARA H-Trust) and increase its stake in ARA H-Trust to 28.3 per cent.

Acrophyte Ltd is wholly owned by Tang Jialei and Tang Jialin, whereas Acrophyte Asset Management Pte Ltd is wholly owned by Acrophyte Pte Ltd, which is ultimately owned by Gordon Tang and Celine Tang.

Acrophyte Ltd is seeking to acquire securities in ARA H-Trust, while Acrophyte Asset Management Pte Ltd is seeking to acquire the managers of ARA H-Trust.

On May 27, Acrophyte Ltd announced the proposed acquisition of a 19.0 per cent stake in ARA H-Trust from ARA Real Estate Investors 23 Pte Ltd for an aggregate consideration of US$34,162,198.

In addition to the 9.3 per cent interest that Tang Group currently owns in ARA H-Trust, the proposed acquisition on completion will increase its stapled security holding in ARA H-Trust to 28.3 per cent.

This will also see Acrophyte Pte Ltd appointed as the new sponsor of ARA H-Trust. The estimated completion date of the transactions is Q2 2024 to Q3 2024, subject to fulfilment of certain conditions precedent.

Acrophyte Ltd, initially known as Chip Eng Seng Corporation, has made significant strides in the real estate sector since the 1990s.

Its expansion into a multinational conglomerate has been marked by a diverse portfolio that spans the entire real estate value chain, including a strong presence in the hospitality industry which includes its Momentus signature hospitality brand.

This transaction marks Acrophyte’s inaugural venture into Reit management, and Acrophyte leverages the combined managerial experience and credentials with its affiliate, SingHaiyi Group which is also an established real estate company.

ARA H-Trust provided a Q1FY24 (ended Mar 31) business update on May 3.

On a year-on-year basis, gross revenue, gross operating profit, and net property income rose by 0.2 per cent, 2.1 per cent and 1.1 per cent, respectively.

The performance demonstrated its stable and resilient portfolio in the face of high interest rates and inflation.

The managers expect continuing recovery in the US lodging market, supported by strong consumer spending and a robust job market.

Wilmar International

On May 30, Wilmar International : F34 0% chairman and CEO Kuok Khoon Hong increased his deemed interest in the global agri-business by 1,757,900 shares at an average price of S$3.10 per share. This increased his total interest from 13.98 per cent to 14.01 per cent. Kuok has been gradually increasing his total interest in Wilmar from 12.94 per cent in October 2022.

On May 30, Wilmar’s executive and non-independent director Teo La-Mei also acquired 10,000 shares at S$3.10 per share. This increased her direct interest to 1.75 million shares, which represents 0.03 per cent of the company. Teo is the group legal counsel and company secretary.

Raffles Medical Group

Between May 23 and 29, Raffles Medical Group : BSL 0% executive chairman Loo Choon Yong acquired 1.55 million shares at an average price of S$1.029 per share. This increased his total interest from 54.20 per cent to 54.29 per cent. Since, late February, Dr Loo has been gradually increasing his total interest in the stock from 53.02 per cent.

Raffles Medical Group currently maintains a presence in 14 cities and five countries. At its FY23 AGM on Apr 26, it relayed its goal to deliver improved results for FY24, building on its reputation as a reliable healthcare service provider, as well as improving operational leverage and efficiency.

Jardine Cycle & Carriage

Between May 27 and 28, Jardine Cycle & Carriage group finance director Amy Hsu purchased 10,000 shares at an average price of S$27.43 per share. This was her first acquisition via a market transaction since she was appointed to the position in August 2022. Hsu oversees the group’s portfolio investments and leads financial strategy and planning, treasury, tax, risk management and investor relations.

On Apr 29, Jardine Cycle & Carriage released an interim management statement for its Q1FY24 (ended Mar 31). The group maintains 50.1 per cent ownership of prominent Indonesian group, Astra, which contributed 93 per cent to its FY23 revenue.

For Q1FY24, Astra’s financial overview indicated a mixed performance across its divisions with a 5 per cent decline in underlying profit, excluding fair value adjustments from its equity investments. Its car and motorcycle sales declined due to subdued economic conditions. However, the financial services division saw an uptick in earnings, thanks to an expanded loan portfolio. Also on a positive note, the agri-business division was supported by increased crude palm oil sales, and the infrastructure and logistics division also reported higher earnings from greater toll revenue. Conversely, the heavy equipment and mining division faced a downturn because of falling coal prices. Jardine Cycle & Carriage maintains a diverse portfolio in South-east Asia, extending beyond its interests in Astra. Its regional interests include investments in Vietnam’s automotive leader Thaco, power and utility specialist REE, regional cement provider Siam City Cement, and top dairy producer Vinamilk. Additionally, the group has a presence in the automotive retail sector with dealerships in Singapore, Malaysia, Myanmar, and Indonesia through Tunas Ridean.

LHT Holdings

Between May 24 and 30, LHT Holdings : BEI 0% managing director, Yap Mui Kee, acquired 113,700 shares at an average price of S$1.059 per share. With a consideration of S$120,450, this took her direct interest in the home-grown pallet manufacturer from 17.79 to 18.00 per cent. Yap has gradually increased her direct interest in LHT Holdings from 14.12 per cent in August 2021.

Plato Capital

On May 27, Plato Capital : YYN 0%chairman, non-executive non-independent director Lim Kian Onn acquired 50,000 shares at an average price of S$2.12 per share. With a consideration of S$106,000, the married deal increased his deemed interest in the investment group from 82.14 per cent to 82.55 per cent. His preceding acquisition was on Apr 12, with 283,000 acquired shares at S$2.21 per share. Lim founded the Libra Capital Group in 1994 and co-founded the holding company, ECM Libra Group in 2002. The latter is listed on the main market of Bursa Malaysia Securities.

Geo Energy Resources

On May 24, Geo Energy Resources : RE4 0% non-executive and independent director David Yan Kin Pung bought 120,000 shares at an average price of S$0.31 per share. This was his first acquisition via a market transaction since he was appointed to the board in November 2023. Yan’s extensive experience in banking, corporate finance, public listings, capital market bond issues, mergers and acquisitions, project development, and general management now spans more than 37 years. He is also presently the senior vice-president of corporate finance at ChemOne Holdings, a petrochemical and natural resources group with interests across South-east Asia.

On May 9, Geo Energy Resources reported Q1FY24 (ended Mar 31) quarterly revenue of US$99.0 million, marking a 25 per cent decline from Q1FY23. This was primarily attributed to the fall in ICI4 coal prices, which averaged US$57.23 per tonne in Q1FY24, down from US$76.60 per tonne in Q1FY23. Seasonal weather conditions impacted production volumes, resulting in 1.8 million tonnes of coal sales in Q1FY24, distributed across the PT Tanah Bumbu Resources, PT Sungai Danau Jaya, and PT Triaryani coal mines. Despite this, the group remains optimistic about meeting its annual sales target of 10 million to 11 million tonnes, anticipating increased sales in H2FY24.
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The writer is the market strategist at Singapore Exchange (SGX). To read SGX’s market research reports, visit sgx.com/research.