E A Foodie Note And An Industrial Stock

I suspect the ACNDF action was the result of India's leaky regulatory system and its gossip-mad exchanges reacting to news that the country would allow real estate investment trusts to be offered inside India. Some 5 bn rupees will be invested in the new REITs, according to Bloomberg.

ACNDF while part of a Singaporean fund management group is a favorite investment by “NRIs”, non-resident Indians, who want to play the country's growth without have to entrust their funds to the wild gyrations of the 8-armed guardian of Indian markets. Moreover they may not want to invest for a minimum of 200,000 rupees ($555) to get into the still non-existent future Indian REITs to protect small investors. So someone worked out that ACNDF might lose its monopoly to other India-based construction firms. But back in Bombay, locals are not considered as trustworthy as Singaporean Chinese. Ascendas, founded 30 years ago in Singapore, operates in corporate business and hotel leasing and real estate management all over Asia and Australia. ACNDS has a US$607 mn market cap. In public REITs and private funds the parent group group has AUM of over S$15 bn. No roach motel.

*Today a similar sell-off of all of 500 shares took down Origin Energy, OGFGF, which fell 4.11% to $12.61, 5% over our entry point. Again we need to look at volume before panicking. I am trying to buy more of the Oz ute which yields 3.6%. It is part of the most advanced project for liquefaction for Chinese demand.

*In London I wrote about $3.1 bn in conditional orders booked by Bombardier, whose US pink sheet ticker symbol is BDRAF, despite its not being able to display its C-Series jets at the British Farnborough International Air Show. I wrote that you “would have looked around—or up—in vain for a sighting of Bombardier's new aircraft.” Its maiden flight has been delayed again, until next year. “But the no-show did not clip the wings of the CS sales agreements.” I then wrote about the new letters of intent for sales to China's Zhejiang Loong Airline and Jordan's Petra Airline for a total of 28 planes. I also noted that Falko Regional (a leasing firm) was buying up to 24 CS100s with “conditions”. I worked out that BDRAF now was holding 203 firm orders and another 292 conditional contracts for the new single-aisle regional jet, carrying 110 to 160 passengers depending on configuration. It needs 300 firm orders to make money when the plane starts to fly in H2 2015.

Mr Heymann rightly points out that the new plane offers shorter takeoff, more range, less noise, lower emissions, lighter weight, and greater fuel economy. He also thinks the stock could triple or quadruple over the next 3-5 years.

He failed to mention that Bombardier is not betting the farm on the C-Series since it also has another business producing railway and tram carriages. I think they are also industrial products.

While it is not likely to go up like KPM today, the Barron's piece may lift off our Bombardier.

*A double-taxation treaty made between Switzerland and Brazil may allow Brazilian multinational companies to avoid having to pay Brasilia after already paying taxes to Berne. The chief victim of the current tax excess has been Vale whose considerable profits continue to be nibble more by back tax claims it is paying off than by the impact of lower iron ore prices. Unlike some other Brazilian giant firms, Vale is dealing in trackable goods sold from real mines. And it lacks the political clout of some other big-spender Brazilian firms which use dodgy foreign sales to produce corrupt political contributions and fraud at home.

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