When I bought Hyflux in 2008 at $2.90 per share, it was a growth company. Revenue jumped 187% from 2007. Earnings per share jumped 78%.
In 2010, Hyflux rewarded the shareholders with bonus shares at 1 bonus share for 2 shares held by investors. My holding of 2,000 shares became 3,000 shares at cost of $1.90 cost per share.
The share prices began to slide and to average down my cost per share, I bought additional 3,000 shares at cost of $0.85 in 2015 (last year).
To my dismay, the share price continued to decline. It was trading at about $0.50 recently. My cost per unit was $1.40 but at 50 cents, I lost $0.90 per share ($5,400 in total) on paper.
Why did I not sell off Hyflux? Firstly, Olivia Lum, Executive Chairman and Group CEO is still the largest shareholder holding 34% of its shares. It is in her interest to ensure that her investments hold up. Secondly, Hyflux is a pioneer in water treatment and desalination. It is known to the global community for its expertise.
Over 8 years, total dividends received were $772. This reduces my cost of investment to $1.27 per share. This did not offer any comfort because my investment in Hyflux lost 60 cents to a dollar.
So what went wrong? Not too pretty. In this case, I am not rewarded for being a loyal investor.
Copyright © 2016, limkimtong for Living Investment
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