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Back to the Future #1: First Service Holding

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Back to the Future #1: First Service Holding

Life is like a box of chocolate... and you may just have it again...

Ong Wee Hiang
Jan 13, 2022
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Back to the Future #1: First Service Holding

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The feeling of Déjà vu.

The whole theory still stand.

This is the company which will be taken out first when the industry consolidate because it is the cheapest and the least “encumbered” by majority shareholders.

Overall, it looks like a good bet again.

Yes, I am going to rehashed a number of my old ideas in my next few posts.

So prepare to go back in time and then possibly into the future.


The story started when some of my subscriber noticed a new position in my portfolio and dropped me an email to ask me about it…

First Service Holding (FSH):

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2021 Quicktake #6: First Service Holding
We missed the run up for the property management services companies in China and we are doing a little bit of catch up here. What has happened is that we got stuck with a bias due to looking at property management firms operating in developed countries. Their financials are hardly inspiring and when China property companies started to spin off their pro…
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2 years ago · 1 like · Ong Wee Hiang

Quickly the story escalated as Evergrande collapsed and the dominos started to fall. Instead of a falling share price, rumours on the market is that FSH is going to be sold…

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Thoughts on Valuation
In recent years, there is a general disregard for the art/science of valuation. Everyone is looking for growth/compounders and valuation had became an afterthought. While I agree that valuation can be an afterthought if there is predictable quality growth which could be forecasted into the next 10 years, valuation become increasingly important when the…
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2 years ago · Ong Wee Hiang

If life is really like a box of chocolates, I really did not knew what I am buying. I should have eaten my chocolates but instead the box got glued shut and I have a box of worthless chocolate for a while…

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Company Update: First Service Holding
I first talked about First Service Holding (FSH) on the 27th July 2021 when a couple of subscribers emailed me about the idea. It is a statistical position in my personal portfolio. On the 28th September when Evergrande blew up, I followed up with an article on not recognising the intelligence of the market and why valuation still matter…
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a year ago · Ong Wee Hiang

Finally, my chocolate box open after much sitting and waiting…. I gladly ate everything and then that’s the end of the story….

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And the takeover news is in...
For subscribers who are sick of my musing on First Service Holding (FSH), this will be the last. FSH and Sunac Services Holdings (SSH) had just did a joint announcement that SSH will be taking over FSH for HKD 2.617. From my average price of HKD 0.914, the share price is up 135% since my entry in May 2021 and I had sold…
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a year ago · 1 comment · Ong Wee Hiang

But wait… What if the box of chocolate is presented back to you again?

With a reluctance to part with a genuine good company at a good price and a possibility that they can raise cash, FSH majority shareholders had decided to renege on the contract and not sell the company!

The decision either meant

  • FSH is such a fraud that it cannot be sold (15%)

  • Shareholder think that it is such a gem that they want to keep it (60%)

  • unknown unknown (25%)

The odds looks pretty good here.

I am not going to go through all the details here as New Vila Equity Research did a wonderful write up on FSH.

Twitter avatar for @NewVilaResearch
New Vila Equity Research @NewVilaResearch
Our last research report is available on our website and substack First Service Holding Limited 🇨🇳 HK:2107 The failed takeover by Sunac Services gives a great opportunity in the Chinese management service sector Web: newvilaresearch.com/research Substack: newvilaresearch.substack.com/p/first-servic…
newvilaresearch.substack.comFirst Service Holding Limited HKEX: 2107The failed takeover by Sunac Services gives a great opportunity in the chinese management service sector
3:47 PM ∙ Jan 11, 2022
66Likes30Retweets

Yes I am holding that box of chocolate again. And hopefully, the wait would be worthwhile.

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Back to the Future #1: First Service Holding

www.weightedresearch.com
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