Insight Provider, CrossASEAN Research

Nicolas Van Broekhoven

Was on the buyside for 15 years, most recently at a medium-sized boutique asset management firm. I grew up in Europe, went to university in the US and have been living in Singapore for the last 7 years which has given me a broad scope on the world and investing in general.

Consider myself a generalist investor with a preference for small and mid-cap companies and special situations. However, a large cap that has gone temporarily out of favor might also pique my interest. 

My style of investing could be categorized as more of value investor, rather than growth at any cost. Learning from Charlie Munger on the importance of quality of a company has been of tremendous value over the years.I like businesses with real earnings, cash flows, dividends, book value and insider ownership.

Insight Provider

Sunpower: Good FY20 Figures; Now in Transition to 100% GI by 2H21. Risk/Reward Highly Attractive

Sunpower: Ex-Dividend Date Coming Soon; 100% GI Should Lead to Re-Rating; Fair Value Remains $1.38

Sunpower: Full Steam Ahead with GI; 84% Upside to 1.18 SGD Fair Value

Sunpower (SPWG SP): GI Continues to Deliver; Re-Rating to 1 SGD Just a Matter of Time

Sunpower (SPWG SP): "I Missed It".NO, It Is Just Beginning. Strong 1H20 Results Forecasted Next Week

Sunpower: Read Across from Buyout of Zheneng JinJiang; Fair Value Remains at 1 SGD (63% Upside)

Smartkarma Corporate Webinar | Sunpower Group: Understanding the Business and Growth Opportunities

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/sunpower-group-ltd" target="_blank" data-smartkarma-citation="entities:18395:1" rel="noopener">Sunpower Group (SPWG SP)</a> has been a long-time favorite and for years we have had a Fair Value estimate of 1 SGD. This target is now too conservative as the company announced it would sell its M&amp;S (Manufacturing &amp; Services) division and become a pure-play on GI (Green Investments). Please note we had been predicting this was an option in August 2020 <a href="https://www.smartkarma.com/insights/sunpower-spwg-sp-i-missed-it-no-it-is-just-beginning-strong-1h20-results-forecasted-next-week" target="_blank" data-smartkarma-citation="insights:41888" rel="noopener">Sunpower (SPWG SP): "I Missed It".NO, It Is Just Beginning. Strong 1H20 Results Forecasted Next Week</a> The M&amp;S division was valued at 2.29 billion RMB or about 50% of Sunpower's total market cap (if one uses the fully diluted share count). The net amount will be 2 billion RMB of which 66% will be paid out as a special dividend. Sunpower shareholders will receive a 0.2359/share special dividend (28% dividend yield).The deal conclusion might be a drawn-out process and this will likely make 1H21 results look "messy" but investors should now just focus on GI results going forward. Given the tone of the conference calls questions, we expect investors to need some time to get their heads around the transaction.<div class="content-highlight">
Sunpower's re-rating should now start in earnest as the GI business is like a utility business with great cash flow generation capabilities. The GI business has 30-year operating concessions and great visibility which is in contrast with the M&amp;S business which is short-term (contract by contract nature).
The GI business should now move to an NPV model (30-year concessions) and we raise our Fair Value to 1.42 SGD (inclusive of 0.28 SGD/dividend).
We, therefore, expect the stock to almost double again from current (0.74 SGD) levels. 
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Sunpower Group (SPWG SP) has been a long-time favorite and for years we have had a Fair Value estimate of 1 SGD. This target is now too conservative as the company announced it would sell its M&amp;S (Manufacturing &amp; Services) division and become a pure-play on GI (Green Investments). Please note we had been predicting this was an option in August 2020 Sunpower (SPWG SP): "I Missed It".NO, It Is Just Beginning. Strong 1H20 Results Forecasted Next Week The M&amp;S division was valued at 2.29 billion RMB or about 50% of Sunpower's total market cap (if one uses the fully diluted share count). The net amount will be 2 billion RMB of which 66% will be paid out as a special dividend. Sunpower shareholders will receive a 0.2359/share special dividend (28% dividend yield).The deal conclusion might be a drawn-out process and this will likely make 1H21 results look "messy" but investors should now just focus on GI results going forward. Given the tone of the conference calls questions, we expect investors to need some time to get their heads around the transaction.
Sunpower's re-rating should now start in earnest as the GI business is like a utility business with great cash flow generation capabilities. The GI business has 30-year operating concessions and great visibility which is in contrast with the M&amp;S business which is short-term (contract by contract nature).
The GI business should now move to an NPV model (30-year concessions) and we raise our Fair Value to 1.42 SGD (inclusive of 0.28 SGD/dividend).
We, therefore, expect the stock to almost double again from current (0.74 SGD) levels. 


M&S Div. Sold Resulting in 28% Special Dividend; Company Now 100% GI Story; Fair Value To 1.42 SGD