Supermarket Income Reit Share Discussion Threads

[swiftnick] 19/4/2022 15:29

Can someone explain why this is trading at 126p when investors can still buy new shares from Primary Bid at 121p? I realise that the Primary Bid shares don't qualify for the 1.485p quarterly dividend, but the price difference is much larger than that (plus there are no dealing costs with PB).

[brexitplus] 14/4/2022 09:39

RBC Capital Markets set a target price of 150 GBX for the company, which when compared to the Supermarket Income REIT PLC share price of 125 GBX at opening today (13/04/2022) indicates a potential upside of 17.0%. Trading has ranged between 111 (52 week low) and 133 (52 week high) with an average of 3,328,980 shares exchanging hands daily. The market capitalisation at the time of writing is £1,231,932,000.

[chucko1] 13/4/2022 10:42

Inflation (RPI) is estimated to average 5.8% over the next 3 years, 5.2% over the next 5 years and 4.6% over the next 10 years.

The 10 year average centred around 3.5% the past 5 years (without a lot of variation) and has steadily moved higher the past year. In that context, the 4% caps are OK. If you look at where the 5 year average will be 5 years into the future, it is (10 x 4.6 - 5 x 5.2)/5 = 4.0%. A similar calculation yields an average of 4.3% between years 3 and 5.

Also, though not shown above, 3.85% between years 1 and 3 but 9.7% in the next 12 months. In other words, all the cap "damage" expected in the near term, but when raising rents would not be easy in any event.

Interesting that long term inflation at 4% or so returns even though we will likely see a reaction (for base effects, to some extent) to the current very high levels (i.e. the 3.85% after this year).

[jonwig] 13/4/2022 10:23

As the FT said in #877, Tesco is conflicted:

Tesco has vowed to keep prices down in the months ahead as spiralling inflation piles pressure on household budgets.

Ken Murphy, chief executive of Tesco, said the supermarket giant was “laser-focused” on keeping the cost of a weekly shop in check as Britons face a squeeze on their finances.

The company warned its own profits would be dented this year due to rising inflation, as well as a return to pre-pandemic shopping habits.

It came as the consumer price index hit 7pc in March, outstripping forecasts and the highest since March 1992. [DT.]
SUPR's latest Tesco buys had a 4% annual rent cap, which will furnish some relief.

[jonwig] 11/4/2022 10:10

If you plan on closing dowm, put up your prices! (Doesn't work for high street shops, though!)

[cwa1] 11/4/2022 09:58

Barclays was the ONLY broker I had to leave in disgust (many years ago). I've moved from others for other reasons(price, usability, etc, etc). They were truly awful in nearly every respect-and they had the cheek to be expensive too! I'm surprised they have any clients at all

[chucko1] 11/4/2022 09:35

Barclays Smart Investor (the irony has escaped them since 2016) have a severe KIID deficit. Only since SUPR has had a "premium listing" has it been available in any way, shape or form. Other issues/funds/ITs do not share this benefit.

They complain that their 3rd party provider is not very good at these things. If you think that's a problem, try collecting the full dividend on REITs when in a SIPP. ISAs no problem, but a SIPP? Try no effing chance - it has taken over 3 years and still a fiasco. I send them spreadsheets, but I might as well send them a burst balloon.

In fact, the entire platform is a danger to a retail investor. Don't get sidetracked by the odd investment - that's the least of one's worries.

An aside - I have to have a Primal Scream regarding BSI about every 6 months. It stops me doing something both regrettable and requiring an explanation in a Court of Law (more the latter than the former).

[williamcooper104] 11/4/2022 09:16

They are nuts My favourite - buy a US ETF - can't do Write an option on a US ETF - no problem

[jonwig] 11/4/2022 09:13

chucko - the form is self-certification: no-one will knock on the door to verify what you sign. But it does mean you're let loose if you lose money, you've no redress.

There are other absurdities such as ii's when I could apply for a new issue but they wouldn't let me buy more in the open market, as there was no KID available. (There was, but ii didn't have it.)

[chucko1] 11/4/2022 08:44

This is precisely what HL said:


"An increasing number of securities are not being made available to Retail Investors, but are restricted to Qualifying and Professional Investors only. This saves costs to the issuer/selling party as they do not need to disclose the same level of detail. It also means that investors are afforded fewer protections on the basis that they are more knowledgeable and able to accept an increased level of risk.

If you believe that you are a Qualifying and Professional Investor and so should be classified as a Professional for the purposes of a particular deal then please complete the attached form honestly and return to us either electronically by return or via the post. Subject to you warranting that you meet the regulatory requirements we will then be able to place the deal.

If you have any doubt about the form please contact your legal advisor. HL does not give advice to Qualifying Professional Investors.

The attached PDF form can be completed electronically and must be returned to [e-mail] from the email address registered to your Hargreaves Lansdown account.

Please follow completion of this form up with a call to our dealing desk on 0117 980 9800 so that we may acknowledge receipt, verify your eligibility to proceed and confirm that your instruction has been accepted.

Yours sincerely,"

SUPR cannot distinguish between those who have previously held SUPR and those who have not. So HL believe this method is necessary to "protect" its Retail customers, even those with a current holding. Might have been nice if they had protected their Woodford customers, but that was not a "sophisticated" product. The rules are insane, but they are what they are and not too difficult to navigate. Or at least in the case of HL.

[bscuit] 10/4/2022 13:17

Chucko, looking back we never knew how scaling back was done, but impression was that retail investors were met in full. Certainly 110,000 is a big slug so scaling back may apply.

[chucko1] 10/4/2022 11:58

Going into the SIPPs anyway. How much was the previous Placement scaled back by? Cannot recall. The Open Offer was not scaled back, but the overall demand was very high and even after an increase in deal size, they had to cut somewhere.

[bscuit] 10/4/2022 07:45

Answer in Gov.uk - Advice for investment Managers. Eligible shares include Offers for sale subject to some restrictions, but specifically does not include an Intermediary Offer or a placing.

[williamcooper104] 09/4/2022 22:46

Thanks - saved me a call

[bscuit] 09/4/2022 21:31

Deleted duplicate post

[bscuit] 09/4/2022 21:31

I spoke to AJB to apply for 110,000 in my SIPP (flat rate fee and no SD makes it worthwhile)- I expect to be scaled back - and the person to whom I spoke could see no reason, why I shouldn’t be able to apply in my ISA, though I have asked for a secure message confirmation. However I think the ISA problem is, I think, related to the fact that ISA purchases have to be in the market.

[chucko1] 09/4/2022 21:12

This is how it is with HL:

1. You need to fill in a QIQ form. This is the form that certifies you as a professional investor.

2. This form is good for ONE TRADE ONLY. You define the trade to be the purchase of SUPR stock in the Placement of whatever size takes your fancy.

3. You pay HL £100 for the privilege of them placing the trade for you. This £100 is not size (of trade)-dependent. You also pay them £50 when you want to sell the shares, but ONLY if you do it by phone. No need for that as we are all more than able to use the internet!!

4. You CANNOT buy the shares into an ISA. Apparently, I was told by phone, this has something to do with HMRC.

5. You fill in the form and send it back to HL. You can then phone them and tell them how many you are looking to buy. You MUST have sufficient cleared funds when placing the order.

Given that there is no difference between the Placement shares and those we may already own, this is all rather baffling. But Placement shares are regarded as a sophisticated product. I am not gong to argue, I am just going to take a deepish breath and do what they ask.

[chucko1] 08/4/2022 09:23

When it's an Open Offer, that is correct. But not when it is only a placement. That appears to be the pattern over the last few raises, and I have bought into each one where I could.

[williamcooper104] 08/4/2022 09:22

Yes - you need to log onto the web platform not the phone app - and there's a corporate action button that you press, you then just need to ensure that you've enough cleared funds in your account to cover your sought allocation and it all happens - pretty efficient

[chucko1] 08/4/2022 09:18

Has anyone had experience of this course of action via HL?? If not, I will phone them today or Monday.

[bscuit] 07/4/2022 23:00

Oops! Yes only £100, so reasonable on a big application, which I intend to do this time.

[chucko1] 07/4/2022 21:34

Not a £100k charge, I hope!!

But very useful information. Mad that it has to be done this way.

[bscuit] 07/4/2022 21:31

The AJB position is consistent with previous issues. I set my first one up direct with Stifel and had AJB make the arrangements. On the second and subsequent applications I had AJB deal direct with Stifel. On those occasions I was talking £20-50K. the £100k was the only charge.

[janeann] 07/4/2022 18:58

Interesting message from AJB........

Unfortunately, we aren’t able to facilitate the Primary Bid offer, however, there’s two separate offerings being made available. The other is a placing through Stifel which we can accommodate, though only within a SIPP or Dealing account and there’s a charge of £100 as it’s a manual process with Stifel to place the order. The order would be made with our Dealing Services Team over the phone.

[jg231] 07/4/2022 16:57

I just contacted investor relations at Atrato Capital (the investment adviser) and they told me that they expect Hargreaves, Interactive Investor and AJ Bell to allow orders in the placing. They said it usually takes several days for the platforms to put it up on the website.