FundManagerZech @FundManagerZech: "🧐 [𝗖𝗼𝗽𝗶𝗲𝗿𝘀 𝗔𝗰𝘁𝗶𝗼𝗻 𝗥𝗲𝗾𝘂𝗶𝗿𝗲𝗱] 𝗔𝗻..."

Australia

🧐 [𝗖𝗼𝗽𝗶𝗲𝗿𝘀 𝗔𝗰𝘁𝗶𝗼𝗻 𝗥𝗲𝗾𝘂𝗶𝗿𝗲𝗱] 𝗔𝗻 𝗢𝗳𝗳𝗲𝗿 𝗔𝗯𝗼𝘃𝗲 𝗠𝗮𝗿𝗸𝗲𝘁 𝗣𝗿𝗶𝗰𝗲? 𝗛𝗲𝗿𝗲’𝘀 𝗪𝗵𝘆 𝗪𝗲’𝗿𝗲 𝗩𝗼𝘁𝗶𝗻𝗴 𝗬𝗲𝘀 🧐 TL;DR 📌 China National Building Material ($3323.HK (China National Building Material)) has struggled, down 50%+ from our buy price and 70%+ from its peak. 📌 Despite this, it remains fundamentally strong: cheap valuation, state-backed, and still profitable. 📌 EGM vote needed: Abstaining on Item 1, Voting FOR Items 2 & 3. If you received an email, make sure to vote! 📢 𝗔𝗰𝘁𝗶𝗼𝗻 𝗥𝗲𝗾𝘂𝗶𝗿𝗲𝗱 𝗳𝗼𝗿 𝗖𝗼𝗽𝗶𝗲𝗿𝘀: 𝗘𝘃𝗶𝗱𝗲𝗻𝗰𝗲 𝗼𝗳 𝗮 𝗛𝗶𝗴𝗵𝗹𝘆 𝗜𝗻𝗲𝗳𝗳𝗶𝗰𝗶𝗲𝗻𝘁 𝗠𝗮𝗿𝗸𝗲𝘁 📢 When I was younger, I remember coming home from school, disappointed by my exam results. My immediate reaction was: I need to study harder, put in more effort, maybe even take extra classes. This mindset worked for a while, but then I noticed something—some people put in less effort yet somehow achieved better results. We’re told that hard work, intelligence, and the right tools lead to success. Yet, when I ask people if they know someone at work who isn’t as good as them but earns more, the answer is almost always yes. The reality? Politics, timing, and luck also play a role in success. I bring this up because one of our largest positions, 3323 (China National Building Material Company Limited), has been struggling. The stock has dropped over 50% since we bought it and more than 70% from its peak. Yet, here’s the reality: ✅ Decent valuation ✅ State-owned (low risk of failure) ✅ Still generating income despite a weak market This is a good stock—we’ve done the deep dive, read the reports, and put in the work. But the market doesn’t always reflect reality. Homo Economicus (the theory that markets are purely rational) is a myth. The market is often irrational. What I do like, however, is when a company takes matters into its own hands. 🚨 𝗔𝗰𝘁𝗶𝗼𝗻 𝗥𝗲𝗾𝘂𝗶𝗿𝗲𝗱: 𝗩𝗼𝘁𝗲 𝗼𝗻 𝘁𝗵𝗲 𝗘𝗚𝗠 🚨 You may have received an email (see pic below) asking you to vote on an Extraordinary General Meeting (EGM)—this happens when something outside the company’s normal powers needs shareholder approval. For Item 1 (director appointment), I’m abstaining. For Items 2 & 3 (buyback & whitewash waiver), I’m voting FOR. 𝗪𝗵𝘆 𝗱𝗼𝗲𝘀 𝘁𝗵𝗶𝘀 𝗺𝗮𝘁𝘁𝗲𝗿? 📌 The company is repurchasing shares at HK$4.03—about 10% above the current price. 📌 This buyback represents 10.83% of the company’s market cap. 📌 Adding the 7% dividend yield, the total Shareholder Yield is 17.83%. Yes, the company has high debt, but it’s at low rates due to SOE status. This buyback is also part of the government’s stimulus efforts to revive the market. If you’re invested, make sure you vote. This is one of those rare cases where shareholders actually have a say in value creation.

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