Still can clearly recalled back in 2014 when Kep DC Reit was launching the IPO came across a blogger recommending a no-go for this IPO based on financial ratio comparison with another data center reit. However, I was pretty clear and straight forward Kep DC Reit was for me. To put it straight, my reason wasn't based on any financial fundamental but purely on from experience what I foresee what the future in need of. Having working in R&D for decades, knowing how importance data management is and at that time in 2014, e-commence was starting to get popular coupling with the common sense that institutions like bank, telcos and exchange centers will have more and more data to be managed. Engaging a data center to do the job will be much more cost efficient than doing it in-house. Looking at after 10 years how Kep DC Reit has performance since IPO, whether said blogger regretted his/her recommendation then definitely not my problem and is super glad that I didn't follow said blogger recommendation.
Kep DC Reit has done a couple of right issues for these 10 years. The first was in 2016 for 274 units for every 1000 units at preferential offer price of S$1.155, the second was in 2019 for 105 units for every 1000 units at preferential offer price of S$1.71. The third was the latest this month of 86 units for every 1000 units at preferential offer price of S$2.03. While I did participate in the 2016 and 2019 right issues, the latest one I decided to skip as I don't see the need for it despite certain degree of dilution. Was there really a dilution effect for my holding in the latest right issue ? Along with the 3 right issues, Kep DC Reit also did several private placements during these 10 years periods.
With the right issues, my initial holding increased by 66.67% and holding price increased from S$0.93 to S$0.9946. So is there really a dilution effect with the latest right issue ??? At the price of S$2.21 (as of 13th Dec 2024), my holding is having an unrealized capital gain of 121.55% and a dividend return of 76.04%. This making an annualized return of +8.28% and +11.52% w/o and with dividend respectively. Though the dividend return has yet to hit the 100% milestone thereby making my investment mathematically impossible to lose money, based on the dividend payout record, I should be able to achieve that in 2026.
