HEDGE FUND JUDAH VALUE JUMPED 46% THIS YEAR ON AGRITRADE STAKE

26h APRIL 2018

By Klaus Wille (Bloomberg)

The Judah Value Activist Fund gained 46 percent since it was launched in January, helped by an investment in Agritrade Resources Ltd., a Hong Kong-listed coal mining company that the Singapore hedge fund says was undervalued. Judah Value, managed by former Oversea-Chinese Banking Corp. trader Roland Thng, accumulated a 2 percent stake in January, valued at HK$101 million ($13 million) at the time, Thng said in an email this week. Shares in Agritrade Resources jumped 56 percent in the first quarter.

Since its initial investment, the fund has added another percentage point to its stake and will buy more shares “at the right time,” according to the email.

“Agritrade Resources was trading at a huge discount to its fair value when Judah Value Activist Fund started investing,” Thng said in the email. “They survived the commodities glut by staying profitable. In addition, they took advantage of the distressed commodities environment by acquiring extremely cheap energy assets.”

With the share price climbing, the price-to-book ratio of Singapore-based Agritrade more than doubled to 2.44 over the past year, data compiled by Bloomberg show. The company, which has a shipping arm, has bought three vessels since the beginning of 2015, according to its website. It has also diversified into renewable energy with a U.S. biodiesel plant and bought an underground coal mine in Kalimantan in Indonesia, adding to its existing plants.

Gearing Up

“We are working prudently to gear up the company’s balance sheet to ramp up production of their mines as well as for strategic acquisitions,” Thng added. A representative for Agritrade declined to comment. The $31 million Judah Value fund, which runs on the hedge- fund platform of Swiss-Asia Financial Services Pte., gained more than 50 percent during its first two months of existence, followed by a 6.7 percent decline in March, according to a newsletter obtained by Bloomberg News. It only takes a stake “if the company is willing to positively consider the fund’s value enhancement proposal,” it said. Thng said Judah Value is now accumulating two more positions.

To contact the reporter on this story: Klaus Wille in Singapore at kwille@bloomberg.net

To contact the editors responsible for this story: Sree Vidya Bhaktavatsalam at sbhaktavatsa@bloomberg.net

Russell Ward, Colin Keatinge