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YZJFH - potentially rewarding

sgng123
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25-Mar-2025 15:48

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Every trading 0.01-0.025 gain, is it slow or fast lol.

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pkli899
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25-Mar-2025 15:36

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Even if 1.80 - 2.30 is the fair value, not necessary stock price will get there.
We know la, never say never. Ya la, anything can happen in stock market.
When more & more ppl think it is possible, then it will move higher and nearer to it.
Let price reach NAV first la&hellip &hellip 117 you know&hellip &hellip &hellip not 80, 90!
It is still quite a distance away......... 一步一步来，不要急

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sgng123
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25-Mar-2025 15:08

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If u think yzjfh fair value is too high, take a look at ifast, byd, teskla their pe is 40x+
As long got big players playing up, any price is possible.
Anyway it don take a lot of money to push yzjfh to nta since 99% investors die die don sell.

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pkli899
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25-Mar-2025 15:05

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Btw, lask week both YZJSB & YZJFH institutions net buy.
Retailors net sell.

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pkli899
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25-Mar-2025 15:04

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Thank you SmallSmall for sharing the report.
This is by far the highest price we have seen.
A little tall order but who knows?
Unlikely in the near future but eventually.
Really hope so.

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MrBear12
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25-Mar-2025 15:02

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Shortists clear out.
Bears cannot survive in this environment.
It looks set to hit its NAV.

Trade with goodbye bear

wehuattogether88 ( Date: 25-Mar-2025 14:58) Posted:

1.80 a bit far off but 1.00 maybe can.

hokpin ( Date: 25-Mar-2025 14:17) Posted:

Wait, Fair Value : 1.80 2.30？

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sgng123
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25-Mar-2025 15:02

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Lol don matter as long big players enter, any price is possible.

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PiRPiR
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25-Mar-2025 15:02

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https://www.nextinsight.net/story-archive-mainmenu-60/948-2025/16075-spin-off-success-story-stock-surges-77-to-record-fund-manager-sees-more-value

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wehuattogether88
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25-Mar-2025 14:58

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1.80 a bit far off but 1.00 maybe can.

hokpin ( Date: 25-Mar-2025 14:17) Posted:

Wait, Fair Value : 1.80 2.30？

SmallSmall ( Date: 25-Mar-2025 12:45) Posted:

From Nextinsight today

&bull One of the star performers so far in 2025 is Yangzijiang Financial (YZJF), which was ignored by the market for the better part of the past 2 years, until 4Q2024.

&bull Born from a strategic spin-off in 2022, the stock has surged an impressive 77% year-to-date in 2025.

This was driven by YZJF' s strong set of FY2024 results: Net profit grew 51%, reaching S$304.6 million. Earnings per share was 8.66 cents.

&bull YZJF is a Singapore investment company listed on the Singapore Exchange (SGX).

It operates as a fund structure, investing in debt and equity securities, with a focus on capital appreciation and investment income.

&bull Following its FY24 results, CGS International (the only sellside broker covering the stock) said it continued to hold a positive view on the stock, with a higher target price of S$0.66 for the stock. (See: YANGZIJIANG FINANCIAL: From Under the Radar to Center Stage: A Financial Star Rises)

&bull But a Singaporean fund manager, who was a sellside analyst, estimates that YZJF deserves a higher valuation, and contributed his write-up below ...

The Company

YZJF was spun off from Yangzijiang Shipbuilding (YZJS), a leading shipbuilding company in China, in 2022.

This move was part of a strategy to separate its investment arm from the core shipbuilding business.

The spin-off allowed YZJF to focus exclusively on managing investments while leveraging the capital generated by YZJS.

Yangzijiang FH
Share price: 73c	Fair value: $1.80-$2.30

As of end-2024, its Assets Under Management was 46-54% split between China and Singapore, deployed in cash management products (43%), debt investments (34%), equity securities (11%) and maritime investments (12%).

It is progressively reducing its weightage in China while increasing investments in maritime-related investments and credit funds in Southeast Asia, particularly Singapore.

Why does a mispricing of the stock exist?

1. Negative sentiment towards Chinese investments due to economic and geopolitical reasons.

2. Spinoff listings typically suffer from:

(1) heavy selling by shareholders (especially institutional investors) whose mandate prohibits them from holding a business different from its mother company

(2) a lack of understanding of the business.

Concerns on its China investments are well allayed

CEO/Chairman Ren Yuanlin is not particularly concerned with the Non-Performing Loans as he can sell collaterised assets such as land.

YZJF ensures that its debt investments are well-collateralized with a loan-to-value ratio of approximately 50%.

YZHFin dividend3.25

For discussion sake, assume its entire China investments go to zero.

Then, its current liquid NTA of $1.17 would stand at $0.76.

The current share price of $0.725 is still at a discount even at such an extremely and unlikely scenario.

The upcoming 3.45 ct dividend (4.8% yield@$0.725 ) + free optionality on the improving business makes the current price still very attractive.

Positive Share price Catalysts

1. Further improvement on its earnings and dividends driven by reducing its PRC investments and deploying its liquid NTA into higher yielding investments in the 2 segments :

&bull Private Credit - partnering with a unit of Temasek Holdings, Singapore&rsquo s state-owned investment company.

&bull More maritime assets - ship chartering, finance leases and loan services.

It has been investing and co-investing in new builds recently.

YZJF is riding on the tailwinds of the global focus on decarbonisation, demand for ships that run on clean fuel. The CEO told the media &ldquo maritime investment business has high growth potential&rdquo .

The annual cash flow returns for the 2 segments are typically in the range of 10-20%.

In FY24 it only generated ~6.6% operating returns on its NTA as ~45% of its NTA was in lower yielding cash management products.

2. Growing fee income from fund management business managing 3rd party assets.

YZJF is raising a US$600m fund to invest in green vessels.

Stock price	73.5 c
52-week range	31-74 c
Market cap	S$2.6 b
PE	8.2
Dividend yield	4.7
P/B	0.6
52-week change	126%

Given its entrenched network and deep knowledge in the maritime industry + industry tailwinds, it is highly probable for YZJF to attract investments from institutions who want exposure to this niche sector.

3. Potential Coverage from more sell-side research including bulge bracket ones + More interest from Institutional and retail investors.

The recent surge in price and volume + the positive results + increasing media coverage have generated more interest in the stock.

Currently, there is only 1 active sell-side coverage by CGS International.

Having a relatively large market cap of $2.6 bil and high liquidity will attract a wider range of institutional funds. This makes commercial sense for more sell-side research to initiate coverage.

How to value YZJF?

CEO/ Chairman Ren, who used to helm Yangzijiang Shipping, told the media that YZJF will continue to grow fast and &ldquo investors will not be denied the same kind of returns that YZJ Shipping has delivered&rdquo .

YZJ Shipping' s share price went up by more than 6x from 2020 to 2024. Applying that to YZJF would mean hitting the share price of ~$1.80.

I would approximately value YZJF in the following manner:

Basic Valuation

We start with the company' s Net Tangible Assets (NTA) per share, which is $1.17.
We assume YZJF can earn a 15% return on its NTA each year.
This gives us an earnings per share (EPS) of $0.18 (15% of $1.17).
If we apply a price-to-earnings (PE) ratio of 10, we get a share value of $1.80.

Valuation with Borrowing

Now, let' s consider what happens if YZJF borrows money to invest:

YZJF borrows an additional 50% of its NTA. (ie, it gears up conservatively to 30% Debt-to-Asset ratio, which is much lower than the ~50% average for asset management firms.)
So for every $100 of its own money, it borrows $50 more.
It pays 6% interest on this borrowed money.
With this extra money, YZJF can invest more and potentially earn more.
This strategy could increase the EPS to $0.23.
Again, applying a PE ratio of 10, we get a share value of $2.30.

The above calculations don' t include the potential value of YZJF' s fund management business.

This could add extra value to the share price, based on the fees and performance income it generates.

It is likely to take some time for the NTA to be fully deployed in higher yielding investments and the fund management business to attract 3rd party AUM to generate material fee income.

However, do note that equity pricing is very forward looking + it' s common for prices to overshoot on the upside during the bull phase and vice versa.

When the outlook is certain, media+ many analysts singing the consensus tunes, prices would have already priced in a great deal of the positive factors.

The risk-reward ratio by then would be far less attractive.

** My valuation figures are just broad estimates. There are many moving parts in a business + new critical info surfacing + fluctuating market sentiment. However, my valuation approach is pretty mainstream and widely used by sell/buy side analysts. Do your own due diligence.

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sgng123
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25-Mar-2025 14:49

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Wait till the big players institutional fund rush in, all shortist would be burned.
Currently it just short covering on daily basic to cut losses on earlier short.

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easywin
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25-Mar-2025 14:45

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Now can only hope for shortist to sell down

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sgng123
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25-Mar-2025 14:39

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When it hit NTA then champion can go into STI30 loh.
cos it offer a niche product in maritime asset with Ren china connections.
Buy new/used ships then resold for profit, no owning or operating so not affected by us tariff.

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easywin
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25-Mar-2025 14:30

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Champion stock in sgx 2025 just buy can earn money easily with very low risk.

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HVRRVH
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25-Mar-2025 14:27

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Nice. Current market price again pull away from average holding cost creating bigger buffer. Looking forward to the upcoming dividend! XD should be in early May 2025.

HVRRVH ( Date: 12-Mar-2025 17:59) Posted:

Completed my accumulation of this stock for the time being. Wouldn' t chase the price now and shall be contended with yearly dividends and sit tightly on paper gains. Price should hit $0.69 before CD/XD to establish dividend yield of 5% and going forward, all eyes is on old Ren and his team whether they can continue to deliver the results. Old Ren has to come back to steer the ship after 1 year plus, right away, YZJF found new direction and ventured into Maritime business. Another year elpased and old Ren has steady the ship and just to highlight, 2H24' s eps is $0.0562, if this trend is keep up, going forward, we could be seeing eps of at least $0.11 per year. This would translate to yearly dividend of at least $0.044 and a yield of 5% that would place the share price at $0.88. Having said so, more could be on the card especially old Ren mentioned to The Edge about spinning off. This, I suspect, could be the main factor driving the share price now or else, there is no reason for such positive sentiment since Chinese businesses are in the crosshair of US tariffs. We shall see.

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easywin
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25-Mar-2025 14:26

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omg 0.755 also taken up.

finjungle ( Date: 25-Mar-2025 14:06) Posted:

yes, if you were to believe the valuation

easywin ( Date: 25-Mar-2025 13:56) Posted:

Wow, in high demand even 0.75 also easily sold can buy more for easy money?

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hokpin
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25-Mar-2025 14:17

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Wait, Fair Value : 1.80 2.30？

SmallSmall ( Date: 25-Mar-2025 12:45) Posted:

From Nextinsight today

Yangzijiang FH
Share price: 73c	Fair value: $1.80-$2.30

Why does a mispricing of the stock exist?

1. Negative sentiment towards Chinese investments due to economic and geopolitical reasons.

2. Spinoff listings typically suffer from:

Stock price	73.5 c
52-week range	31-74 c
Market cap	S$2.6 b
PE	8.2
Dividend yield	4.7
P/B	0.6
52-week change	126%

Basic Valuation

We start with the company' s Net Tangible Assets (NTA) per share, which is $1.17.
We assume YZJF can earn a 15% return on its NTA each year.
This gives us an earnings per share (EPS) of $0.18 (15% of $1.17).
If we apply a price-to-earnings (PE) ratio of 10, we get a share value of $1.80.

Valuation with Borrowing

Now, let' s consider what happens if YZJF borrows money to invest:

YZJF borrows an additional 50% of its NTA. (ie, it gears up conservatively to 30% Debt-to-Asset ratio, which is much lower than the ~50% average for asset management firms.)
So for every $100 of its own money, it borrows $50 more.
It pays 6% interest on this borrowed money.
With this extra money, YZJF can invest more and potentially earn more.
This strategy could increase the EPS to $0.23.
Again, applying a PE ratio of 10, we get a share value of $2.30.

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sgng123
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25-Mar-2025 14:17

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This analysis give even higher fair value of
$1.80
$2.30 if yzjfh expand AUM on borrowing.
Wow rocketing yzjfh to heaven lol

SmallSmall ( Date: 25-Mar-2025 12:45) Posted:

From Nextinsight today

Yangzijiang FH
Share price: 73c	Fair value: $1.80-$2.30

Why does a mispricing of the stock exist?

1. Negative sentiment towards Chinese investments due to economic and geopolitical reasons.

2. Spinoff listings typically suffer from:

Stock price	73.5 c
52-week range	31-74 c
Market cap	S$2.6 b
PE	8.2
Dividend yield	4.7
P/B	0.6
52-week change	126%

Basic Valuation

We start with the company' s Net Tangible Assets (NTA) per share, which is $1.17.
We assume YZJF can earn a 15% return on its NTA each year.
This gives us an earnings per share (EPS) of $0.18 (15% of $1.17).
If we apply a price-to-earnings (PE) ratio of 10, we get a share value of $1.80.

Valuation with Borrowing

Now, let' s consider what happens if YZJF borrows money to invest:

YZJF borrows an additional 50% of its NTA. (ie, it gears up conservatively to 30% Debt-to-Asset ratio, which is much lower than the ~50% average for asset management firms.)
So for every $100 of its own money, it borrows $50 more.
It pays 6% interest on this borrowed money.
With this extra money, YZJF can invest more and potentially earn more.
This strategy could increase the EPS to $0.23.
Again, applying a PE ratio of 10, we get a share value of $2.30.

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vicloo
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25-Mar-2025 14:16

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And good thing is US markets doesn't affected China linked stocks listed in Singapore much hehe.

sgng123 ( Date: 25-Mar-2025 09:27) Posted:

The only sellers is shortist, they pray every night US market would crash.
but trump policy flipflop like crazy resulting in them making wrong bet

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vicloo
Supreme

25-Mar-2025 14:14

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Hitting 75.5c, by end of next week should see 80c.

finjungle ( Date: 25-Mar-2025 14:06) Posted:

yes, if you were to believe the valuation

easywin ( Date: 25-Mar-2025 13:56) Posted:

Wow, in high demand even 0.75 also easily sold can buy more for easy money?

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finjungle
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25-Mar-2025 14:06

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yes, if you were to believe the valuation

easywin ( Date: 25-Mar-2025 13:56) Posted:

Wow, in high demand even 0.75 also easily sold can buy more for easy money?

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