*Official* MasterLeong Thread

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MasterLeong

MasterLeong

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lightchaser said:
ML anyhow hamtam !
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Genosis said:
Nope.....PLife has 98% debts on fixed rates hehehe:D

https://sias.org.sg/files/SGXMarketUpdates/09062016-Singapore-REITs-Debt-Profiles-in-March-Quarter.html

Starhill even more satki.....100% on fixed rates!!!:eek:
Click to expand...




learnt not to follow articles blindly, go read up annual report and u have all the answer to preit life... why its interest cost so low at 1.x%... whereas blue chips like CMT/CCT pay close to 3%... plife reit is not even a blue chip... if they do the same loan structure as others they would also pay around 3%

http://plifereit.listedcompany.com/misc/ar2015/ar-2015.pdf

go see page 119/120

2ytwr5f.png


ALL 10 of their loans are ALL IN FLOATING RATES and are vulnerable to interest rates risks

they put they are 98% hedge... is likely via DERIVATIVE contracts

I do not know the details and my INFORMATION MAY BE WRONG

buy p life reit at your OWN RISK


i would 100% avoid it...

valuations too high at over 40% premium to book

all floating rate loans....


no offenses to those vested... I just presenting the facts

if rates move from 0.25% to 3%
98% hedge doesn't mean their interest cost will remain 98% the same... it is likely not a FULL HEDGE... when interest rates goes to 3%, the interest cost may go up from 1.5% to 2.5% due to hedge but not 4-5% without hedge...
 
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MasterLeong

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GOLDEN POST OF THE DAY.. always do your own research and digging of information.... do not read one liners like "98% of interest hedged and blindly believe"


MasterLeong said:
learnt not to follow articles blindly, go read up annual report and u have all the answer to preit life... why its interest cost so low at 1.x%... whereas blue chips like CMT/CCT pay close to 3%... plife reit is not even a blue chip... if they do the same loan structure as others they would also pay around 3%

http://plifereit.listedcompany.com/misc/ar2015/ar-2015.pdf

go see page 119/120

2ytwr5f.png


ALL 10 of their loans are ALL IN FLOATING RATES and are vulnerable to interest rates risks

they put they are 98% hedge... is likely via DERIVATIVE contracts

I do not know the details and my INFORMATION MAY BE WRONG

buy p life reit at your OWN RISK


i would 100% avoid it...

valuations too high at over 40% premium to book

all floating rate loans....


no offenses to those vested... I just presenting the facts

if rates move from 0.25% to 3%
98% hedge doesn't mean their interest cost will remain 98% the same... it is likely not a FULL HEDGE... when interest rates goes to 3%, the interest cost may go up from 1.5% to 2.5% due to hedge but not 4-5% without hedge...
Click to expand...
 
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tanjiakpeng

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MasterLeong said:
learnt not to follow articles blindly, go read up annual report and u have all the answer to preit life... why its interest cost so low at 1.x%... whereas blue chips like CMT/CCT pay close to 3%... plife reit is not even a blue chip... if they do the same loan structure as others they would also pay around 3%

http://plifereit.listedcompany.com/misc/ar2015/ar-2015.pdf

go see page 119/120

2ytwr5f.png


ALL 10 of their loans are ALL IN FLOATING RATES and are vulnerable to interest rates risks

they put they are 98% hedge... is likely via DERIVATIVE contracts

I do not know the details and my INFORMATION MAY BE WRONG

buy p life reit at your OWN RISK


i would 100% avoid it...

valuations too high at over 40% premium to book

all floating rate loans....


no offenses to those vested... I just presenting the facts

if rates move from 0.25% to 3%
98% hedge doesn't mean their interest cost will remain 98% the same... it is likely not a FULL HEDGE... when interest rates goes to 3%, the interest cost may go up from 1.5% to 2.5% due to hedge but not 4-5% without hedge...
Click to expand...

at face value - yes these are all floating rate notes. but if there are notes to the FS to indicate that they have been swapped to fixed via a deriavative - then genosis's link would be beneficial.
 
MasterLeong

MasterLeong

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tanjiakpeng said:
at face value - yes these are all floating rate notes. but if there are notes to the FS to indicate that they have been swapped to fixed via a deriavative - then genosis's link would be beneficial.
Click to expand...

there is always an risk when using derivatives, the counter party can default the reit can be fully exposure to the higher rates

also the hedge may be a partial hedge, with partial exposure to higher rates



there is no free lunch in this world... the highest quality BBB to AA reits are paying around 3% interest rates on their debt

whereas plife reit is only paying 1%++ on their debt, super low.... thus inflating their distribution payout and stock price

if plife reit took up a more normal debt structure, the distribution would be lesser and the premium to nav would be less for sure


some may disagree with my analysis of plife reit, some may agree

investing is always a mix of art and science

different people see things differently

cheers
 
Genosis

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tanjiakpeng said:
at face value - yes these are all floating rate notes. but if there are notes to the FS to indicate that they have been swapped to fixed via a deriavative - then genosis's link would be beneficial.
Click to expand...

All these hedging stuff really confusing.....:s22:

Bro, dun mind me asking......so is the 98% hedge by PLife got use or not? Or just pointless?
 
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