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My investment in Country Garden (2007.HK)
11 Nov 2022 (440 views)  

Over a period of 6 weeks from 23 Sep 2022 to 3 November, I bought 630,000 shares of Country Garden at an average price of HK 1.59 for a total investment of $175,747 SGD.

At the worst point on 3 November, I saw a paper loss of $61,705 SGD.

In 2019, the stock price of Country Garden went to a high of HK $12. The price of $1.03 represented a drop of 92%.

I had confidence in the stock as the developer is the largest in China. 

Another big developer (Evergrande) had collapsed. A knowledgeable person told me that China cannot afford to have Country Garden collapsed as well.

More importantly, Country Garden is able to manage its debts well. They do not face the same risk as Evergrande.

I consider the stock price had dropped way below its fundamental value. I did not cut loss when the stock price dropped. Instead, I bought additional shares to average down my cost.

Over the past week, Country Garden recovered strongly. The stock price more than doubled to $2.24.

I sold 400,000 shares at an average price of $1.83.

I now hold 230,000 shares at an average cost of $1.16. At the current price of $2.24, I now have a gain of $43,620 SGD.

The turnaround in the stock price turned a loss $61,705 SGD into a net gain of $43,625 SGD. I was able to realize this gain because I did not panic and cut loss when the stock price collapsed.



Tan Kin Lian

My investment in Country Garden (2007.HK)
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Over a period of 6 weeks from 23 Sep 2022 to 3 November, I bought 630,000 shares of Country Garden at an average price of HK 1.59 for a total investment of $175,747 SGD.

At the worst point on 3 November, I saw a paper loss of $61,705 SGD.

In 2019, the stock price of Country Garden went to a high of HK $12. The price of $1.03 represented a drop of 92%.

I had confidence in the stock as the developer is the largest in China. 

Another big developer (Evergrande) had collapsed. A knowledgeable person told me that China cannot afford to have Country Garden collapsed as well.

More importantly, Country Garden is able to manage its debts well. They do not face the same risk as Evergrande.

I consider the stock price had dropped way below its fundamental value. I did not cut loss when the stock price dropped. Instead, I bought additional shares to average down my cost.

Over the past week, Country Garden recovered strongly. The stock price more than doubled to $2.24.

I sold 400,000 shares at an average price of $1.83.

I now hold 230,000 shares at an average cost of $1.16. At the current price of $2.24, I now have a gain of $43,620 SGD.

The turnaround in the stock price turned a loss $61,705 SGD into a net gain of $43,625 SGD. I was able to realize this gain because I did not panic and cut loss when the stock price collapsed.



Tan Kin Lian