Research Firm with a Qualitative Overlay, Pearl Gray Equity and Research

Pearl Gray Equity and Research

Research Firm with a Qualitative Overlay

Quantitative fund & research firm with a qualitative overlay. 

Our coverage: General U.S. with a skew towards the primary sector. 

Methods: Smart Beta/Factor Pricing, Neural Networks, Street Gossip, and Common Sense.

Equity Bottom-Up

<ul>
<li>Most of the bank's restructuring charges will be phased out of its valuation as they are non-core.</li>
<li>However, a residual income model suggests that Citigroup's stock is tremendously undervalued.</li>
<li>The bank is scheduled to release its Q4 earnings report on Friday, and we are exceptionally bullish.</li>
</ul>


Most of the bank's restructuring charges will be phased out of its valuation as they are non-core.
However, a residual income model suggests that Citigroup's stock is tremendously undervalued.
The bank is scheduled to release its Q4 earnings report on Friday, and we are exceptionally bullish.


Citigroup: A Q4 Earnings Beat Is Highly Possible

Selected Quarterly & Annual Newsletters from Funds, Fund Newsletters

Fund Newsletters

Selected Quarterly & Annual Newsletters from Funds

Thematic (Sector/Industry)

<ul><li>SaltLight Capital Management started in 2015 and has grown tremendously, with assets under management doubling each year. Our investment process is continuously evolving.</li><li>Despite the market downturn our cumulative redemptions are a mere basis points of the fund.</li><li>We are more concerned with the ‘two birds in the bush’ so to speak; and then extending the adage further: what is the price implying to catch these plump birds.</li><li>With a more concentrated portfolio of businesses, portfolio volatility can be higher, but volatility can be compensated with higher returns.</li><li>We have no conviction about the direction of the market - we don’t believe one can consistently predict this with high accuracy.</li></ul>

SaltLight Capital Management started in 2015 and has grown tremendously, with assets under management doubling each year. Our investment process is continuously evolving.Despite the market downturn our cumulative redemptions are a mere basis points of the fund.We are more concerned with the ‘two birds in the bush’ so to speak; and then extending the adage further: what is the price implying to catch these plump birds.With a more concentrated portfolio of businesses, portfolio volatility can be higher, but volatility can be compensated with higher returns.We have no conviction about the direction of the market - we don’t believe one can consistently predict this with high accuracy.

SaltLight Capital Management Q3 2022 Co-Investor Letter

<ul><li>We may have different expectations concerning inflation, interest rates, or economic growth, but, at the end of the day, what we buy will determine the portfolio’s return (and its risk).</li><li>Most of our work is devoted to seeking out individual investment opportunities and analyzing them rather than to macroeconomic forecasting.</li><li>As we expected, the need for capital investment over the long term has been, and will likely remain, higher than we anticipated.</li></ul>

We may have different expectations concerning inflation, interest rates, or economic growth, but, at the end of the day, what we buy will determine the portfolio’s return (and its risk).Most of our work is devoted to seeking out individual investment opportunities and analyzing them rather than to macroeconomic forecasting.As we expected, the need for capital investment over the long term has been, and will likely remain, higher than we anticipated.

Vltava Fund Q3 2022 Letter To Shareholders

<ul><li>Citi's Basel III framework is safe as houses, we urge investors to remain coy as systemic risk remains high due to volatile economic and geopolitical features.</li><li>The firm's operating cash flow is robust and covers an attractive 4.03% dividend yield soundly, we urged investors to stay coy.</li></ul>

Citi's Basel III framework is safe as houses, we urge investors to remain coy as systemic risk remains high due to volatile economic and geopolitical features.The firm's operating cash flow is robust and covers an attractive 4.03% dividend yield soundly, we urged investors to stay coy.

SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

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 <img src='https://api2.sgx.com/sites/default/files/2021-09/IFS-CEO.jpg' alt='IFS - CEO' />
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 <div class='content-caption'>IFS - CEO</div>
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For engineer by training Randy Sim, the holy grail of successful leadership involves cultivating the qualities of self-awareness and self-management.  
“Understanding our own behaviours and motivations, taking ownership and responsibility for our actions, leading by example - these are some of the defining characteristics of self-leadership,” said the Group Chief Executive Officer of SGX-listed financing solutions provider IFS Capital Ltd. 
“Self-leadership is essential for us to be able to take care of our families or run our organisations effectively. Those who manage themselves from the inside out tend to have greater focus and direction, and be successful leaders. It took me a long time to realise this, and it remains a continuous work-in-progress for me.” 
Sim, a Bachelor of Engineering with Honours graduate from Singapore’s Nanyang Technological University, began his career with the Economic Development Board in 2004. In 2007, he joined Citibank, and over the next eight years, held various roles across its consumer and commercial banking businesses. 
In 2016, the opportunity to join IFS Capital as Country Head of its Singapore operations emerged.  
“I’ve had the privilege to work with talented and driven individuals - mostly entrepreneurs - throughout my career, and I became deeply curious about the world of business. So, when Eugene Tan, who was then Group CEO of IFS, gave me the opportunity to run IFS Singapore, it didn’t take me long to decide,” Sim recalled.  
“What made the role even more interesting was its turnaround mandate - it felt like a good platform to implement the ideas that I have,” he added.  
IFS Capital reported four consecutive years of net attributable losses between 2013 and 2016, before returning to the black in 2017. One particular strategy Sim and his team undertook early in the turnaround process was to “paint a smaller circle”.  
“This meant we focused only on what we knew and could execute well, and dropped the other lines of businesses that diverted management bandwidth,” he said.  
“When we forced ourselves to focus, the self-imposed limitations required us to build an all-weather portfolio that can perform well through cycles. That principle became the benchmark that we used to originate new business, and this approach continues to serve us well in the present environment,” he added. 
In July 2020, Sim was promoted to Group CEO of IFS Capital after his predecessor retired.  
Incorporated in Singapore in 1987, IFS Capital offers commercial financing services like factoring, hire-purchase/leasing, loans, government-assisted schemes and trade/export finance, to Micro, Small and Medium Enterprises (MSMEs), both in Singapore and across Southeast Asia. 
The Group, which oversees a diverse portfolio of businesses ranging from insurance to fintech, is part of the PhillipCapital network of companies. IFS has been listed on SGX Mainboard since July 1993. Boosting Liquidity Links 
Since IFS Capital’s core expertise lies in underwriting credit, many of its new businesses are extensions of that, Sim said. 
“Our interactions with micro-enterprises led us to form Friday Finance to serve the own-account worker/self-employed/entrepreneur segment, which may be small now, but which we feel will grow not only in Singapore, but across the region,” he noted.  
“We also created Lendingpot to inform and connect SMEs to different pockets of liquidity available in the market.” 
Friday Finance, a licensed moneylender in Singapore, provides consumer loans via a digital portal with a focus on financial wellness, at an affordable and transparent pricing. Lendingpot operates an online Business Loan Marketplace, which allows small enterprise owners to instantly connect with relationship managers of up to 45 financial institutions in Singapore to find the best loan. 
“Our financing businesses across ASEAN have also been actively exploring partnerships and bringing our solutions to new industries,” he added.  
“These new initiatives will enable us to expand the segment of clients that we can serve, and diversify our revenue streams. More importantly, we get to leverage our expertise and technology to scale them across Asia.” 
The Group’s most recent venture - IFS Asset Management - has received approval from the Monetary Authority of Singapore (MAS) to start operating as a registered fund management company. 
“This is another example of an extension of our core expertise in underwriting credit,” Sim said. “Private credit is a growing asset class, and from our experience in the past four years, we felt we could create a differentiated product that would have a place in investors’ portfolios.” 
Additionally, the CEO of IFS Asset Management, Lui Tuck Wing, is a veteran who has navigated ASEAN-wide credit portfolios across multiple business cycles. “Our focus is on credit strategies, and we believe this to be a highly scalable business,” Sim pointed out.  
And though growth opportunities abound, several challenges need to be addressed. “SMEs are perceived to be an underserved segment, and we expect increasing competition over the near to mid-term, resulting in tighter margins, looser covenants and structures,” he acknowledged. 
“We will need to be conscious of the underlying shifts, and work even more closely with our clients to ensure we can support their business plans, now and post-pandemic. During periods when there is too much exuberance, we must exercise discipline, and refrain from chasing transactions that do not meet our risk-return requirements.” 
There is also a gap between enterprise and consumer user experiences in most industries, including finance. “We see growing expectations within the SME space for products and services that combine enterprise-grade security and consumer-grade user experiences. This is an area where we have a lot of work to do,” he added. Capitalising on Opportunities 
As a smaller and nimbler organisation, IFS Capital aims to think differently and optimise for different parameters versus the competition, in order to capture opportunities at the edge.  
“We’re constantly iterating our programs, processes and technology in order to remove friction in our user experiences, and we actively seek partnerships that can help us extend our reach and bring greater value to our clients,” he said. 
The COVID-19 pandemic, while creating significant operational challenges, has also taught the Group many lessons. 
“We’ve been operating with a distributed workforce since early 2020, and have transitioned to complete remote arrangements in some countries. We know now that it’s possible to operate our business with a level of flexibility that we did not think possible just a few years ago,” Sim said. 
From a business perspective, the pandemic has also sped up digital transformation in the industries that the Group serves. “This has given us the chance to engage our stakeholders to adopt new technology and processes to improve the way we operate and serve our clients,” he noted. 
New business avenues have also surfaced in segments that have grown fast over the past year, driven by increased digital adoption and time spent online. “We’ve observed greater interest in entrepreneurship and side hustles - our teams are working hard to capture these opportunities.” 
Meanwhile, in terms of Environmental, Social and Governance (ESG) goals, the Group is focused on aligning its business practices in a way that reflects its vision of a sustainable future. 
“This principle has guided us in focusing on productive financing, shifting away from fossil fuel-related industries, and exploring how we can support development of the electric vehicle supply chain in Thailand and Indonesia, as well national programs such as the 30-by-30 vision for food security in Singapore,” Sim said.  
“Our approach is to think deeply about our business, the communities we operate within, and the future we hope to play a part in bringing about. Then we prioritise our objectives, communicate to our teams, and execute on our strategies. We’re still at an early stage in our ESG journey - there’s much more work that we need to do.” 
And when this 42-year-old is out of the office, his time is either spent reading, or with his family, which includes a son, five, and daughter, eight.  
“There are many subjects that interest me, and I find I get good ideas from different fields that I can apply, in both business and life,” Sim said.  
“What really inspires me are stories of how people have made the best of their resources and opportunities to achieve their goals. I am constantly awed by the possibilities within the human spirit.” IFS Capital Ltd 
Incorporated in Singapore in 1987, IFS Capital offers commercial financing services like factoring, hire-purchase/leasing, loans, government-assisted schemes and trade/export finance, to Micro, Small and Medium Enterprises (MSMEs), both in Singapore and across Southeast Asia. The Group, which oversees a diverse portfolio of businesses ranging from insurance to fintech, is part of the PhillipCapital network of companies. IFS has been listed on SGX Mainboard since July 1993. 
The company website is: <a href="http://www.ifscapital.com.sg">www.ifscapital.com.sg</a>

Click <a href="https://www.sgx.com/securities/equities/I49">here </a>for the company's StockFacts page. 
For the half year ended 30 June 2021 financial results, click <a href="https://links.sgx.com/1.0.0/corporate-announcements/WV5C6CMXZM1HB1IF/679022_SGX%20Announcement%20-%201H%20FY2021%20Financial%20Results.pdf">here</a>. 
 

About kopi-C: the Company brew

Text: Jennifer Tan-Stanisic Photo: Company file kopi-C is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations. 
For previous editions of kopi-C: the Company brew, please click <a href="https://www.sgx.com/research-education/market-dialogues">here</a>.   
For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to <a href="https://www.sgx.com/jennifer.t@sgx.com">jennifer.t@sgx.com</a>.
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    IFS - CEO


For engineer by training Randy Sim, the holy grail of successful leadership involves cultivating the qualities of self-awareness and self-management.   
“Understanding our own behaviours and motivations, taking ownership and responsibility for our actions, leading by example - these are some of the defining characteristics of self-leadership,” said the Group Chief Executive Officer of SGX-listed financing solutions provider IFS Capital Ltd.  
“Self-leadership is essential for us to be able to take care of our families or run our organisations effectively. Those who manage themselves from the inside out tend to have greater focus and direction, and be successful leaders. It took me a long time to realise this, and it remains a continuous work-in-progress for me.”  
Sim, a Bachelor of Engineering with Honours graduate from Singapore’s Nanyang Technological University, began his career with the Economic Development Board in 2004. In 2007, he joined Citibank, and over the next eight years, held various roles across its consumer and commercial banking businesses.  
In 2016, the opportunity to join IFS Capital as Country Head of its Singapore operations emerged.   
“I’ve had the privilege to work with talented and driven individuals - mostly entrepreneurs - throughout my career, and I became deeply curious about the world of business. So, when Eugene Tan, who was then Group CEO of IFS, gave me the opportunity to run IFS Singapore, it didn’t take me long to decide,” Sim recalled.   
“What made the role even more interesting was its turnaround mandate - it felt like a good platform to implement the ideas that I have,” he added.   
IFS Capital reported four consecutive years of net attributable losses between 2013 and 2016, before returning to the black in 2017. One particular strategy Sim and his team undertook early in the turnaround process was to “paint a smaller circle”.   
“This meant we focused only on what we knew and could execute well, and dropped the other lines of businesses that diverted management bandwidth,” he said.   
“When we forced ourselves to focus, the self-imposed limitations required us to build an all-weather portfolio that can perform well through cycles. That principle became the benchmark that we used to originate new business, and this approach continues to serve us well in the present environment,” he added.  
In July 2020, Sim was promoted to Group CEO of IFS Capital after his predecessor retired.   
Incorporated in Singapore in 1987, IFS Capital offers commercial financing services like factoring, hire-purchase/leasing, loans, government-assisted schemes and trade/export finance, to Micro, Small and Medium Enterprises (MSMEs), both in Singapore and across Southeast Asia.  
The Group, which oversees a diverse portfolio of businesses ranging from insurance to fintech, is part of the PhillipCapital network of companies. IFS has been listed on SGX Mainboard since July 1993.  Boosting Liquidity Links  
Since IFS Capital’s core expertise lies in underwriting credit, many of its new businesses are extensions of that, Sim said.  
“Our interactions with micro-enterprises led us to form Friday Finance to serve the own-account worker/self-employed/entrepreneur segment, which may be small now, but which we feel will grow not only in Singapore, but across the region,” he noted.   
“We also created Lendingpot to inform and connect SMEs to different pockets of liquidity available in the market.”  
Friday Finance, a licensed moneylender in Singapore, provides consumer loans via a digital portal with a focus on financial wellness, at an affordable and transparent pricing. Lendingpot operates an online Business Loan Marketplace, which allows small enterprise owners to instantly connect with relationship managers of up to 45 financial institutions in Singapore to find the best loan.  
“Our financing businesses across ASEAN have also been actively exploring partnerships and bringing our solutions to new industries,” he added.   
“These new initiatives will enable us to expand the segment of clients that we can serve, and diversify our revenue streams. More importantly, we get to leverage our expertise and technology to scale them across Asia.”  
The Group’s most recent venture - IFS Asset Management - has received approval from the Monetary Authority of Singapore (MAS) to start operating as a registered fund management company.  
“This is another example of an extension of our core expertise in underwriting credit,” Sim said. “Private credit is a growing asset class, and from our experience in the past four years, we felt we could create a differentiated product that would have a place in investors’ portfolios.”  
Additionally, the CEO of IFS Asset Management, Lui Tuck Wing, is a veteran who has navigated ASEAN-wide credit portfolios across multiple business cycles. “Our focus is on credit strategies, and we believe this to be a highly scalable business,” Sim pointed out.   
And though growth opportunities abound, several challenges need to be addressed. “SMEs are perceived to be an underserved segment, and we expect increasing competition over the near to mid-term, resulting in tighter margins, looser covenants and structures,” he acknowledged.  
“We will need to be conscious of the underlying shifts, and work even more closely with our clients to ensure we can support their business plans, now and post-pandemic. During periods when there is too much exuberance, we must exercise discipline, and refrain from chasing transactions that do not meet our risk-return requirements.”  
There is also a gap between enterprise and consumer user experiences in most industries, including finance. “We see growing expectations within the SME space for products and services that combine enterprise-grade security and consumer-grade user experiences. This is an area where we have a lot of work to do,” he added.  Capitalising on Opportunities  
As a smaller and nimbler organisation, IFS Capital aims to think differently and optimise for different parameters versus the competition, in order to capture opportunities at the edge.   
“We’re constantly iterating our programs, processes and technology in order to remove friction in our user experiences, and we actively seek partnerships that can help us extend our reach and bring greater value to our clients,” he said.  
The COVID-19 pandemic, while creating significant operational challenges, has also taught the Group many lessons.  
“We’ve been operating with a distributed workforce since early 2020, and have transitioned to complete remote arrangements in some countries. We know now that it’s possible to operate our business with a level of flexibility that we did not think possible just a few years ago,” Sim said.  
From a business perspective, the pandemic has also sped up digital transformation in the industries that the Group serves. “This has given us the chance to engage our stakeholders to adopt new technology and processes to improve the way we operate and serve our clients,” he noted.  
New business avenues have also surfaced in segments that have grown fast over the past year, driven by increased digital adoption and time spent online. “We’ve observed greater interest in entrepreneurship and side hustles - our teams are working hard to capture these opportunities.”  
Meanwhile, in terms of Environmental, Social and Governance (ESG) goals, the Group is focused on aligning its business practices in a way that reflects its vision of a sustainable future.  
“This principle has guided us in focusing on productive financing, shifting away from fossil fuel-related industries, and exploring how we can support development of the electric vehicle supply chain in Thailand and Indonesia, as well national programs such as the 30-by-30 vision for food security in Singapore,” Sim said.   
“Our approach is to think deeply about our business, the communities we operate within, and the future we hope to play a part in bringing about. Then we prioritise our objectives, communicate to our teams, and execute on our strategies. We’re still at an early stage in our ESG journey - there’s much more work that we need to do.”  
And when this 42-year-old is out of the office, his time is either spent reading, or with his family, which includes a son, five, and daughter, eight.   
“There are many subjects that interest me, and I find I get good ideas from different fields that I can apply, in both business and life,” Sim said.   
“What really inspires me are stories of how people have made the best of their resources and opportunities to achieve their goals. I am constantly awed by the possibilities within the human spirit.”  IFS Capital Ltd  
Incorporated in Singapore in 1987, IFS Capital offers commercial financing services like factoring, hire-purchase/leasing, loans, government-assisted schemes and trade/export finance, to Micro, Small and Medium Enterprises (MSMEs), both in Singapore and across Southeast Asia. The Group, which oversees a diverse portfolio of businesses ranging from insurance to fintech, is part of the PhillipCapital network of companies. IFS has been listed on SGX Mainboard since July 1993.  
The company website is: www.ifscapital.com.sg

Click here for the company's StockFacts page.  
For the half year ended 30 June 2021 financial results, click here.  
 

About kopi-C: the Company brew

Text: Jennifer Tan-Stanisic Photo: Company file  kopi-C is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations.  
For previous editions of kopi-C: the Company brew, please click here.    
For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to jennifer.t@sgx.com.



IFS Capital: Advancing Enterprise Financing

United States

Citigroup Inc. is a diversified financial services holding company that provides a broad range of financial services to consumer and corporate customers. The Company services include investment banking, retail brokerage, corporate banking, and cash management products and services. Citigroup serves customers globally.

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Citigroup Inc (C US)

Citigroup: A Q4 Earnings Beat Is Highly Possible

Most of the bank's restructuring charges will be phased out of its valuation as they are non-core. However, a residual income model suggests that...

Pearl Gray Equity and Research

SaltLight Capital Management Q3 2022 Co-Investor Letter

SaltLight Capital Management started in 2015 and has grown tremendously, with assets under management doubling each year. Our investment process...

Fund Newsletters

Vltava Fund Q3 2022 Letter To Shareholders

We may have different expectations concerning inflation, interest rates, or economic growth, but, at the end of the day, what we buy will...

Fund Newsletters

Citigroup: Cautious Buy Rating Assigned

Citi's Basel III framework is safe as houses, we urge investors to remain coy as systemic risk remains high due to volatile economic and...

Pearl Gray Equity and Research

IFS Capital: Advancing Enterprise Financing

For engineer by training Randy Sim, the holy grail of successful leadership involves cultivating the qualities of...

Singapore Exchange Ltd (SGX)

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