Analysis of Olam 6.75%b180129 Retail Bond

• Current Price on 26th Jan 2015 = US$1.043
• Interest = US$0.0675 per share
• Yield = 6.472%
• Credit Rating = None

Investment till Callable Date

• Tenure = 3 years
• Total Interest = US$0.2025 per share
• Capital Loss = $0.043
• Overall Return = $0.1595
• Overall Annual Yield = 5.097%

I realize that I made an error in my previous analysis and discounted one payment of the coupon which amounts to $0.03375. Apologies for that. Here is the current statistics.

With the current statistics, especially when it corrected to reflect its distribution of interest, its overall annual yield is now at 5.097% which is extremely attractive. Current yield is at 6.472% which is also the highest among the SGX retail bonds. The only issue is that it is US$. But US$ is currently quite stable and is increasing so risk is very minimal.

Olam is currently majority-owned by Temasek Holdings which is Singapore's SWF. As a Singaporean, I do trust the judgement of Singapore's SWF especially when it is listed on SGX. They can't let it go down the drain because ordinary Singaporean is also vested in it. To me, Temasek Holdings gave them security.

This excites me as I am able to find one bond which is much stronger than what OCBC 360 account can offer (which is risk-free). Thus, I am switching my cash reserves over to Olam 6.75%b180129 Retail Bond