I know I know, it is supposed to be sell in May and go away but I am never bothered by such strategy. What is more important to me is that I can get a reasonable return in a timeframe of about 3 years. Which means even if market performance from May to October is really weaker, I am not affected as I will still benefit from the stronger performance in the other half.

I did sell earlier this month as I wanted to adjust my portfolio. Click on the image if you have missed my earlier post.

So with the fund raised, I added the following counters over the past fortnight. Again, my eyes are looking at the picture 2 to 3 years later and I believe these buys should get me a reasonable return by then.

OCBC and UOB

While NIM for the banks have peaked, they are still much higher than FY2022 Q2 and Q3. OCBC is expecting NIM to be around 2.2% for the whole year and based on past trend, UOB should be around 2.0% to 2.1%. Hence, both banks will continue to benefit from a higher net interest income for FY2023 as compared o FY2022.

Coupled that with possibly increase in non-interest income, FY2023 should be another record breaking year!

The annualised EPS for OCBC and UOB are $1.68 and $3.52 respectively. With a dividend policy of 50% payout, we can expect dividend of around $0.80 and $1.70 for this year, and that translates to 6.4% and 6.0% yield for my purchased price! Definitely better than the fixed deposit rate offered by the banks.

What about FY2024 and beyond? No crystal ball but it’s my opinion that NIM is more likely to drift downwards than to plunge. So banks should be able to mitigate the lower NII with higher non-interest income. Don’t take my words for it though, as I have no financial qualification and am definitely not an economist.

Venture

As expected, Venture reported a weaker Q1. I thought the results was decent in the current macro environment but the market differs in her opinion and Venture share price has dropped by about 9% since Monday’s results announcement. There are some positives going forward that should help the group to continue to stay profitable for this financial year.

Commencement of mass production for new products and cost management should help with the top and bottom lines respectively. Given the strong cash position of about $3.15 per share and the group’s past position on declaring dividend, I do think dividend will stay at 75 cents this year. That will provide a yield of 4.8% at my latest purchase price.

iFAST and Parkwaylife

I have nothing new to add on for these two counters. Basically I continue to believe in their stories and if they execute their plans well, then they would do well from 2025 onwards.

Going Away?

Ok ok, I am not really going away as I am not done with buying yet. I am waiting for further discount before adding more to the above buys. I am also likely to add AEM and Raffles Medical Group but would like to see their latest quarterly results before making the move.

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