Company bonds

[wondrdoggie]

I think you guys are referring to this bond. If so, bond is issued in sg and denominated in sgd. No euro fx risk.

*** CAPITALAND TREASURY 10Y SGD - INITIAL PRICE GUIDANCE @ 4% AREA ***

Issuer: CapitaLand Treasury Limited.

Guarantor: CapitaLand Limited
Rating: Unrated
Status: Senior, unsecured
Issue Size: TBD
Distribution: As per Information Memorandum, Singapore selling restrictions under Section 274/275 of SFA
Format/Docs: Reg S Bearer / Issuer's SGD 5 billion Euro Medium Note Programme
Initial Price Guidance: 4% area
Tenor: 10-Year
Denomination: SGD250K
Governing Law: Singapore Law
Listing: SGX-ST
Clearing: CDP
Selling Restrictions: Sections 274 and/or 275 of the Singapore SFA
Jt Bkrunners: DBS & HSBC
B&D: DBS

 

[Knight_Rider]

Yes this bond correct but it is use to pay the EMTN. So what happen if the EMTN default? Maybe you or that one who like your post can answer. And I am asking the 2 armchair critic where is the EMTN from. I also agree with ST but that is not the complete picture. If they can't answer themselves then they will be forever hiding behind somebody without backbone like a clown. Like I said the chart come out already I can say until got dragon got Phoenix.

I think you guys are referring to this bond. If so, bond is issued in sg and denominated in sgd. No euro fx risk.

*** CAPITALAND TREASURY 10Y SGD - INITIAL PRICE GUIDANCE @ 4% AREA ***

Issuer: CapitaLand Treasury Limited.

Guarantor: CapitaLand Limited
Rating: Unrated
Status: Senior, unsecured
Issue Size: TBD
Distribution: As per Information Memorandum, Singapore selling restrictions under Section 274/275 of SFA
Format/Docs: Reg S Bearer / Issuer's SGD 5 billion Euro Medium Note Programme
Initial Price Guidance: 4% area
Tenor: 10-Year
Denomination: SGD250K
Governing Law: Singapore Law
Listing: SGX-ST
Clearing: CDP
Selling Restrictions: Sections 274 and/or 275 of the Singapore SFA
Jt Bkrunners: DBS & HSBC
B&D: DBS

 

[Shiny Things]

I think you guys are referring to this bond. If so, bond is issued in sg and denominated in sgd. No euro fx risk.

*** CAPITALAND TREASURY 10Y SGD - INITIAL PRICE GUIDANCE @ 4% AREA ***

Issuer: CapitaLand Treasury Limited.

Guarantor: CapitaLand Limited
Rating: Unrated
Status: Senior, unsecured
Issue Size: TBD
Distribution: As per Information Memorandum, Singapore selling restrictions under Section 274/275 of SFA
Format/Docs: Reg S Bearer / Issuer's SGD 5 billion Euro Medium Note Programme
Initial Price Guidance: 4% area
Tenor: 10-Year
Denomination: SGD250K
Governing Law: Singapore Law
Listing: SGX-ST
Clearing: CDP
Selling Restrictions: Sections 274 and/or 275 of the Singapore SFA
Jt Bkrunners: DBS & HSBC
B&D: DBS

That pricing looks very aggressive.

I don't have a good source for CDS market data, but Markit tells me that Capland 5y CDS is trading 4% upfront + 100bps running. I'm in a bar right now so I can't do the exact conversion to a running rate, but if you call it 180bps running you wouldn't be far off. And 10y's going to trade wider than 5yr... Bit of a wild guess but let's say 10y CapLand CDS would trade somewhere around the 250bps mark.

10y SGS are trading 2.32%; chuck 250bps of credit spread on top of that and you get about 4.8%. I'd say with the new issue discount 5% is probably fair for the new Capland bond. 4% definitely isn't enough; at those levels I think you'd rather just sell the CDS instead of buying the bond.

 

[Knight_Rider]

From the same programme. Guaranteed by CapitaLand so hopefully it's safe.

CapitaLand to issue US$400m notes due 2022 | Singapore Business Review

That pricing looks very aggressive.

I don't have a good source for CDS market data, but Markit tells me that Capland 5y CDS is trading 4% upfront + 100bps running. I'm in a bar right now so I can't do the exact conversion to a running rate, but if you call it 180bps running you wouldn't be far off.

10y SGS are trading 2.32%; chuck 180bps of credit spread on top of that and you get about 4.12%... I'd say with the new issue discount 4.2% is probably fair for the new Capland bond. 4% definitely isn't enough; at those levels I think you'd rather just sell the CDS instead of buying the bond.

 

[Shiny Things]

Yes this bond correct but it is use to pay the EMTN. So what happen if the EMTN default? Maybe you or that one who like your post can answer. And I am asking the 2 armchair critic where is the EMTN from. I also agree with ST but that is not the complete picture. If they can't answer themselves then they will be forever hiding behind somebody without backbone like a clown. Like I said the chart come out already I can say until got dragon got Phoenix.

Oh mate. Oh, mate. There is a saying over here in the West: "If you find yourself in a hole, stop digging".

You saw the phrase "Euro MTN" and assumed it meant "€-denominated bond". And so you went off on one of your too-cool-for-school rants about the euro. That's not what it means.

Since you asked, this EMTN is issued in Singapore, denominated in SGD, by a Singaporean issuer, through a Singaporean clearer. Like I told you, and like Wondrdoggie told you, there is no European risk here, because that's not what "Euro MTN program" means.

You are wrong. Stop trying to make yourself sound right. Now would be a very good time to sit quietly and listen to the conversation instead of sticking your nose in and trying to sound smart; you're not impressing anybody.

 

[wondrdoggie]

Yes this bond correct but it is use to pay the EMTN. So what happen if the EMTN default? Maybe you or that one who like your post can answer. And I am asking the 2 armchair critic where is the EMTN from. I also agree with ST but that is not the complete picture. If they can't answer themselves then they will be forever hiding behind somebody without backbone like a clown. Like I said the chart come out already I can say until got dragon got Phoenix.

EMTN just means a non US debt instrument between 5-10 years maturity. If you are concerned about fx risk because the euro is going down (which is true), there isn't any. The note is denominated in SGD which means you used SGD to pay for it and at maturity you get the principal back in SGD. Same goes for the coupon payouts.

I guess a lot of the terms banks use are US centric, and to some Americans, they only look to Europe beyond their shores.

EMTN is just a type of debt instrument and not an entity, so can't really talk about any defaults. The issuer, capitaland treasury may default and that is part of risks involved in holding bonds.

Generally, there are a few bond risks: Six Biggest Bond Risks

 

[wondrdoggie]

That pricing looks very aggressive.

I don't have a good source for CDS market data, but Markit tells me that Capland 5y CDS is trading 4% upfront + 100bps running. I'm in a bar right now so I can't do the exact conversion to a running rate, but if you call it 180bps running you wouldn't be far off. And 10y's going to trade wider than 5yr... Bit of a wild guess but let's say 10y CapLand CDS would trade somewhere around the 250bps mark.

10y SGS are trading 2.32%; chuck 250bps of credit spread on top of that and you get about 4.8%. I'd say with the new issue discount 5% is probably fair for the new Capland bond. 4% definitely isn't enough; at those levels I think you'd rather just sell the CDS instead of buying the bond.

Hi shiny,

Here are the comparisons:

COMPS :
CAPITA 3.48% 24 SGD300M 3.38% / 100.80
CAPSLP 4.30% 20 SGD350M 3.08% / 106.65

 

[Shiny Things]

Hi shiny,

Here are the comparisons:

COMPS :
CAPITA 3.48% 24 SGD300M 3.38% / 100.80
CAPSLP 4.30% 20 SGD350M 3.08% / 106.65

Wow, really? My CDS data must be old. (Anyone wanna fund a Kickstarter to buy me a Bloomy subscription?)

4% still feels tight for 10y unrated paper, but if the 3.48s of '24 are really trading at 3.38 then this is the most obvious switch in the world (and also there's no way this new issue prices at 4.0, it's going to price at something like 3.5).

 

[wondrdoggie]

Wow, really? My CDS data must be old. (Anyone wanna fund a Kickstarter to buy me a Bloomy subscription?)

4% still feels tight for 10y unrated paper, but if the 3.48s of '24 are really trading at 3.38 then this is the most obvious switch in the world (and also there's no way this new issue prices at 4.0, it's going to price at something like 3.5).

Yep, ignoring the comps, 4% to lock in for 10 years doesn't sound attractive. If there are step-ups, maybe can consider.

 

[SpeedingBullet]

Bond noob here, have no idea what's going on so lemme try to understand this:

Essentially you're saying this bond issue by Capland is severely underpriced relative to the SGS 10 Years considering it's an unrated issue, right?

How do you incorporate CDS data to value bonds?

 

[wondrdoggie]

Bond noob here, have no idea what's going on so lemme try to understand this:

Essentially you're saying this bond issue by Capland is severely underpriced relative to the SGS 10 Years considering it's an unrated issue, right?

How do you incorporate CDS data to value bonds?

If I am not wrong, shiny is using CDS as an opportunity cost for buying a bond. And he also contrasts it with SGS comparables. But in order to do that, you need accurate CDS rates. If. You don't have the rates, you can then look at comparables and extrapolate.

In any case, whether or not a bond is a good deal, you mainly look at comparables and gauge. You can compare with other bond issues within same company or look at similar class companies' bonds. And also take into bond tenor, moody/fitch ratings and if there are special features like convertible bonds, step-ups (increases in coupons after a period of time) and interim call dates. Don't think there is a fixed algorithm though, maybe some actuary can do that. In any case, secondary market for bonds in sg is damn opaque.

 

[neanea]

anyone have a list of sg company bonds, their yields and maturity dates?

 

[Mecisteus]

anyone have a list of sg company bonds, their yields and maturity dates?

Corporate Bonds | tradehaven

 

[icicic]

Wow, really? My CDS data must be old. (Anyone wanna fund a Kickstarter to buy me a Bloomy subscription?)

4% still feels tight for 10y unrated paper, but if the 3.48s of '24 are really trading at 3.38 then this is the most obvious switch in the world (and also there's no way this new issue prices at 4.0, it's going to price at something like 3.5).

Capitaland CDS is not all that liquid and bbg data on Asia CDS isn't all that great either. You'd probably be better off with some runs sent to your mailbox from a friendly sales person.

 

[neanea]

Corporate Bonds | tradehaven

The list is not complete

 

[wondrdoggie]

The list is not complete

Seriously? That is a pretty good list already. In any case you will only get firm prices when you are ready to buy/sell. It's OTC.

Curious, why do you want a full list?

 

[Mecisteus]

The list is not complete

then you need to do your own homework.

it is not easy to compile such a list.

 

[sophie.wee.weng]

Wouldn't the list's prices change by tomorrow?

 

[wondrdoggie]

Wouldn't the list's prices change by tomorrow?

Yep. You will only get a firmer price quote when you want to buy or sell.

 

[neanea]

Any good SG company bonds to eye on?