| At the AGM of KSH Holdings recently (26 July 2019), a shareholder stood up and asked the chairman if the company could continue to pay dividends in future years. The shareholder said he counted on that, given that the company had a great track record of paying dividends. The shareholder noted that anyone who has held KSH shares since its 2007 IPO would have gotten back his initial capital and more. Now, that is something -- especially for a construction contractor-cum-property developer. |
After some digging and number crunching, I have these details:
• Assume you bought 100,000 shares of KSH at 36 cents apiece during its IPO. Your outlay: $36,000. • Since then KSH has given out bonus shares and done a stock split, so the number of shares you hold has ballooned by 3X to 302,500. • KSH has paid out $66,535 in dividends to you. • Your current shareholding is worth $142,175 at 47 cents a share. • Total gain: $66,535 in dividends + $142,175 current market value of shares = $208,710. That's a 5.8X return in 12 years, or 15.8% compounded annual growth rate!
• The returns would be much higher if you had subscribed for warrants in 2009 and exercised them. I have excluded the effects of this from the above calculation. |
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From $58,000 to … |
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$409,940 |
Now, let's assume you did subscribe for your entitlement (post stock split) of 200,000 warrants (1-for-1 at 1 cent each) and you subsequently (pretty quickly exercised them at 10 cents apiece, as did a number of shareholders).
Your cost was 200,000 warrants x 11 cents each = $22,000.
Thus your shareholding has now surged to 400,000 shares, and after 3 bonus issues, you have a total of 605,000 shares for which your capital investment was $36,000 + $22,000 = $58,000.
The dividends you would have received add up to an astonishing $125,590!
In absolute dollars:
You stock holding's current value = 605,000 x 47 cents = $284,350.
Total gain: $125,590 + $284,350 = $409,940. What a windfall!
That's a 7.1x return, or a 17.7% compounded annual growth rate!
|
Payment date |
Dividend/bonus |
No. of shares |
$ received |
|
14 Dec 2018 |
SGD 0.01 |
605,000 |
$6,050 |
|
20 Aug 2018 |
SGD 0.012 |
605,000 |
$7,260 |
|
08 Dec 2017 |
SGD 0.01 |
605,000 |
$6,050 |
|
|
BONUS 1 FOR 4 |
|
|
|
14 Aug 2017 |
SGD 0.015 |
484,000 |
$7,260 |
|
14 Aug 2017 |
SGD 0.005 |
484,000 |
$2,420 |
|
09 Dec 2016 |
SGD 0.0125 |
484,000 |
$6,050 |
|
22 Aug 2016 |
SGD 0.015 |
484,000 |
$7,260 |
|
22 Aug 2016 |
SGD 0.005 |
484,000 |
$2,420 |
|
|
BONUS 1 FOR 10 |
|
|
|
08 Dec 2015 |
SGD 0.0125 |
440,000 |
$5,500 |
|
08 Dec 2015 |
SGD 0.003 |
440,000 |
$1,320 |
|
21 Aug 2015 |
SGD 0.015 |
440,000 |
$6,600 |
|
08 Dec 2014 |
SGD 0.0125 |
440,000 |
$5,500 |
|
08 Aug 2014 |
SGD 0.0175 |
440,000 |
$7,700 |
|
29 Nov 2013 |
SGD 0.0125 |
440,000 |
$5,500 |
|
21 Aug 2013 |
SGD 0.0115 |
440,000 |
$5,060 |
|
21 Dec 2012 |
SGD 0.0135 |
440,000 |
$5,940 |
|
|
BONUS 1 FOR 10 |
|
|
|
23 Aug 2012 |
SGD 0.005 |
400,000 |
$2,000 |
|
01 Dec 2011 |
SGD 0.01 |
400,000 |
$4,000 |
|
23 Sep 2011 |
SGD 0.01 |
400,000 |
$4,000 |
|
08 Dec 2010 |
SGD 0.01 |
400,000 |
$4,000 |
|
30 Aug 2010 |
SGD 0.01 |
400,000 |
$4,000 |
|
08 Dec 2009 |
SGD 0.01 |
400,000 |
$4,000 |
|
28 Aug 2009 |
SGD 0.01 |
400,000 |
$4,000 |
|
28 Aug 2009 |
SGD 0.01 |
400,000 |
$4,000 |
|
|
Exercise of warrants |
|
|
|
11 Dec 2008 |
SGD 0.015 |
200,000 |
$3,000 |
|
28 Aug 2008 |
SGD 0.011 |
200,000 |
$2,200 |
|
|
STOCK SPLIT |
|
|
|
24 Aug 2007 |
SGD 0.025 |
100,000 |
$2,500 |
|
Total dividends |
|
|
$125,590 |
|
Basic data: SGX website |
|
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There is a 1.2 cent final dividend for FY2019 to be paid on 16 Aug 2019.  KSH co-founder, executive chairman and MD Choo Chee Onn, 68. Photo: CompanySo what did Mr Choo Chee Onn, the executive chairman, reply to the shareholder's question on future dividends?"Since our IPO, we have not failed shareholders when it comes to dividends. Currently, our balance sheet is strong. I can't predict for the next 5-10 years but over the next 2-3 years we definitely can pay dividends." Mr Choo is one of the founders of KSH, and clearly has created tremendous shareholder value as executive chairman and MD since IPO. |
KSH is likely to benefit from a confluence of big catalysts:
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→ @ KSH Holdings' AGM: Gaobeidian project to launch in Oct 2019 (finally) → KSH: Bulk of en bloc redevelopments yet to award construction contracts |
