February 23rd, 2022 | 06:44 CET
TUI, Hong Lai Huat, Shell: 3 shares in Putin mode
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At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.
TUI: Dampening travel fever
When Malaysia Airlines Flight 17 was shot down over Ukraine in 2014, the world reacted with horror. Old fears are resurfacing with the current escalation around Ukraine and its Donbas region, which separatists have occupied for years. Many travelers are likely to have a queasy feeling before flights to the East these days. The rising oil prices associated with the crisis are also likely to be an indirect burden. It seems only a matter of time before airlines will also have to adjust their prices.
While it seems that consumers are willing to pay almost any price these days to escape the German gloom, customers' financial resources are finite and, given inflation, also strained. So what is next for TUI? Business has been encouraging in the past few months - sales have risen significantly, and liquidity is also in good shape again. Although the government wants to reduce its holdings in companies rescued during the height of the pandemic, the Ministry of Finance is aware that it makes no sense to deprive companies like TUI of breathing space. However, given the escalation in the East and rising oil prices, the stock could come under pressure again. The share must clear the EUR 3.50 hurdle for a long-term trend reversal.
Hong Lai Huat: Real estate in Cambodia
While an established travel company like TUI suffers from mood swings among its discerning clientele, stocks like Singapore's Hong Lai Huat have a built-in risk buffer. Hong Lai Huat develops real estate properties in Cambodia. The country is a hot spot for backpackers and has always been considered an insider's tip because of its beaches. According to the World Bank, Cambodia has been growing dynamically for years - before the pandemic, annual growth rates were consistently around 7%. Currently, there is still a pandemic bump. More and more wealthy tourists from China and the rest of Asia are coming to the country and buying real estate there. Hong Lai Huat has already completed the D'Seaview project in 2020, which offers 67 commercial spaces in addition to a sophisticated 737 apartments. Despite the pandemic, 85% of the building has already been marketed at USD 1,300 per sqm.
In 2023, the even larger Royal Platinum project is scheduled for completion. Hong Lai Huat holds a 50% stake in the project in the capital of Phnom Penh. The average selling price per sqm is expected to be USD 2,000. As a third project, the Company has acquired the Agri Hub, a 100 million sqm land package, which the Company plans to develop step by step over the next few years. In addition to agriculture, small companies should also find a place and develop positively. The vast area is only an hour's drive from Phnom Penh. On February 18, the project was launched together with officials of the country. Hong Lai Huat's stock is considered an insider's tip among Asian investors. Observers point to low valuations - around 74% of the stock market value is covered by real estate. The share has been running sideways while anchor shareholders gradually increase their holdings. Those who want to invest in Cambodia can take a closer look at Hong Lai Huat - the company seems to be popular with local decision makers. Further projects are also in the pipeline.
Shell: This reflex is understandable
Given the crisis surrounding Ukraine, Shell's shares are also in demand again. Although the value has been rising for months, the recent price increase has given the value a new impetus. Shell could do good business with gas in particular in the future. The Company also has some sustainable projects in its portfolio and is thus positioning itself for the future. The big profits from rising energy prices are likely to be made by other companies that still have growth potential in fossil fuels, but Shell is worth considering in the current global situation.
Shell is a logical choice for many investors these days, and the outlook does indeed look promising. On the other hand, shareholders of TUI are becoming somewhat nervous. The extent to which the latest negative news will negatively impact is unclear. Hong Lai Huat should develop relatively independently of current market events: The Company operates in an emerging region and is moderately valued. Although investments in Cambodia also entail risk, such opportunities are relatively rare on the stock market. However, investors should do their due diligence and invest according to their portfolio structure.
Conflict of interest
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