How about a manufacturer of CD and DVD discs? Apparently demand for discs has not decreased as much as one (I) would expect, Swing seems to be doing pretty well.
I am a bit concerned about the historical share increases and swelling working capital, but I find it offset by stable margin and pretty good balance sheet.
Entered at P/NCAV 0.35.
I have put some of the proceeds from sale of Hengxin in Oriental Watch Holdings. Oriental is in the business of luxurious watches. They have a flag ship store in Hong Kong and some other stores across Asia. The business has slowed quite a bit during the last year but the balance sheet is strong. They also seem to have some control of cost, which is important as fixed costs and inventory write-downs have killed many net-net retailers before.
On the plus-side Oriental seems to be a shareholder friendly company with a good history of dividends.
Entered at @ P/NCAV of 0.43.
After a sweet run over the last 3 three months I decided to exit my position in Hengxin today. The stock has a positive momentum and is now trading at around NCAV.
The return on the position ended up at +122 % (in HK$). I think that the relisting to Hong Kong have had a positive impact on the price.
Eidai Kako – the second Japanese manufacturing company this month. Priced at P/NCAV 0.61. Eidai Kako is in the industry of plastic resins, car mats etc. As usual a strong balance sheet and dividends.
The Japanese net-nets are now a substantial part of the portfolio, I am thinking if I should do anything about the currency exposure. I lean towards the opinion that the currency exposure is a nice diversification. I’ll probably not try any (imperfect) hedging – which as far as I know I could only do with mini-futures.
Another Japanese net-net. Nippon Antenna – a manufacturing company with solid balance sheet, profitable plus a (somewhat) regular dividend. Took position at 655 ¥ which equals an P/NCAV ratio of about 0.55.
Charle Co is a Japanese company that sell women clothing and cosmetics. The share is trading close to net cash and negative enterprise value. Strong balance sheet. The company is profitable and has a decent history of dividends.
I took a small position at P/NCAV 0.68 earlier today. The share will make a nice addition to the portfolio.