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Thursday January 28 2021 3 food stocks that COVID boosted

The global meal-kit delivery market is expected to reach about US$20 billion by 2027, underpinned by annual compound growth of almost 13%, according to Grand View Research Inc. As Tony Featherstone says in his article today, most industries would kill for that rate of long-term growth. Tony has always liked Marley Spoon, the best-known ASX-listed meal-kit provider. And today he takes you through this company and two others in the space.

Sincerely,

Peter Switzer

Inside this Issue 02 3 food stocks that COVID boosted 3 food stocks that COVID boosted by Tony Featherstone 06 What’s on the fast food menu? DMP, CKF, RBD & OLI by Tim Boreham 09 Buy, Hold, Sell – What the Brokers Say 6 upgrades, 6 downgrades by Rudi Filapek-Vandyck 3 food stocks that 12 Questions of the Week Questions of the Week COVID boosted by Paul Rickard by Tony Featherstone 02

Important information: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before Switzer Super Report is published by Switzer Financial Group Pty Ltd AFSL No. 286 531 acting, consider the appropriateness of the information, having regard to the Level 4, 10 Spring Street, , NSW, 2000 individual's objectives, financial situation and needs and, if necessary, seek T: 1300 794 893 F: (02) 9222 1456 appropriate professional advice. 3 food stocks that COVID boosted by Tony Featherstone

One of the best small-business stories to emerge popular with consumers who worry about catching the from COVID was the success of Providoor, a new Coronavirus. Second, some of the extra people who food-ordering platform that delivers tried meal-kits during the pandemic will become meal-kits to homes. long-term customers of meal-kit providers.

Launched by celebrity chef Shane Delia, Providoor Then there’s the megatrend of people spending less brings ingredients and recipes from upmarket time cooking meals from scratch. Witness the to consumers, who finish the meal off in booming ready-to-eat market as Uber, Menulog and their . It’s a bit like a luxury version of Deliveroo ferry breakfasts, lunches and dinner to the HelloFresh or Marley Spoon for foodies who like to masses each week. cook. Consider how supermarkets are changing their Like most fast-growing ventures, Providoor has had product mix. Their fridges are devoting more space to some glitches, partly due to higher-than-expected ready-to-eat meals and their shelves to meal-kit demand for its service. The service took off during products. Is it any wonder Americans now spend COVID as consumers craved for gourmet meals more on eating out and takeaways than on their when their favourite restaurants were shut. weekly grocery shop?

Providoor is the latest variation in the booming Within a decade, it will be the norm for more ready-to-cook (RTC) market. More people are Australians to eat the majority of their meals out, use subscribing to meal services that deliver ingredients food-delivery services or meal-kits. A mix of food and recipes to homes. That’s creating opportunity for channels seems like: groceries for part of the week; investors to buy companies here and overseas in the eating out or takeaways later in the week; and RTC market. meal-kits when time allows.

The global meal-kit delivery market is expected to Australian investors have few ways to play this trend reach about US$20 billion by 2027, underpinned by locally. Marley Spoon (MMM), a favoured micro-cap annual compound growth of almost 13%, according to of this column, is the best-known ASX-listed meal-kit Grand View Research Inc. Most industries would kill provider. Youfoodz Holdings (YFZ), a December for that rate of long-term growth. 2020 Initial Public Offering (IPO), is another option.

Some consumers subscribe to meal-kit services My Food Bag, another fast-growing food-box because they are time-poor. Others subscribe provider, is reportedly gauging interest from because they are bereft of meal ideas and need institutional investors in an IPO on ASX. Expect a few culinary inspiration. For some, meal-kits are a way to meal-kit providers to list on ASX via IPOs in coming try new recipes and a form of entertainment as they years as investor interest in this category grows. create fancy dishes. Here are three ways to play the trend: COVID will boost meal-kit growth in several ways. First, regular trips to the supermarket will be less 1. HelloFresh (HFG SE)

Thursday 28 January 2021 02 Listed on the Frankfurt Stock Exchange, HelloFresh is the leading global meal-kit provider.

Its sales in the nine months to September 30 more than doubled to €2.6 billion compared to the same period in 2019. With restaurants and cafés temporarily shut during COVID, HelloFresh’s active customer base grew 92% to 5 million. Source: Yahoo Finance HelloFresh shares soared more than threefold during 2. Youfoodz Holdings (YFZ) 2020 to €72.5. A few investment banks have issued “underweight” recommendations on HelloFresh due I first noticed Youfoodz at my local gym. Young to its sharply higher valuation. The stock trades on a gym-goers seem to load up on Youfoodz’s whopping Price Earnings (PE) of almost 50 times. high-protein, low-fat meals available from the gym’s fridges. There are two ways to look at HelloFresh. The first is that the COVID-induced spike in demand for its Youfoodz sought $70 million in a December 2020 IPO service will reverse when lockdown restrictions ease, at $1.50 a share. The stock looked a little pricey at more people return to work in CBDs, and overseas the offer and fell a quarter on its first trading day. It hit restaurants open up. Meal-kits will be less popular 93 cents earlier this month in a rising sharemarket as when life returns to normal. its IPO fizzle started to fade. The bull case says COVID has legitimised HelloFresh Youfoodz shares rallied to $1.16 this week after a as a way of ordering groceries rather than a novelty trading update for second-quarter FY21. or one-off solution. That was the view of Munro Management reaffirmed prospectus forecasts, Partners, which tipped HelloFresh as its top idea at outlining strong growth across the business. the 2020 Sohn Hearts and Minds Investment Leaders Conference. Youfoodz prepared more than 4.8 million meals in the quarter, up 28% on the same period a year earlier. I’m somewhere in between. The meal-kit experience Home-delivery orders soared 45%, in part due to during COVID will provide long-term benefits for higher COVID-related demand. HelloFresh. Its business model is sustainable and it has many growth options by providing speciality Half-year net revenue for FY21 rose almost 16% to meal-kits (gluten-free, for example), or through $73 million. Youfoodz said the sales-growth acquisitions. momentum had continued into the third quarter. But I’d wait until HelloFresh’s rally subsides and The result impressed. Stronger consumer sales offset look to buy the stock during the next market slightly lower wholesale demand from petrol stations correction, or as market jitters about lower short-term and other outlets that stock Youfoodz meals. demand for its services increase. It’s a great stock to put on the portfolio watchlist with a view to buying Youfoodz has plenty of growth avenues. The nearer €50, a potential point of support on its price -based company in November launched a chart. next-day delivery service in and is building its meal-subscription services through a Chart 1: HelloFresh SE (HFG) mobile App launch that will help grow recurring sales.

In wholesale, Youfoodz added 700 stores during the second quarter to stock its product and believes it can expand in the corporate market through airline

Thursday 28 January 2021 03 partnerships. The company’s snack-food range could issue of the Switzer Report publishes (January 28). I benefit as airline travel recovers. expect good growth and possibly a lift in Marley Spoon’s shares, given recent price weakness. A I like Youfoodz’s product, strategy and execution. poor result would hammer the stock, given COVID It’s a ready-to-heat meal provider rather than a tailwinds for meal-kits. meal-kit company, but the basic premise is the same: time-poor consumers wanting nutritious meals at I like Marley Spoon’s business model, brand and home, without having to source ingredients, cook and product. A high proportion of repeat customers in its wash up. revenue stream is encouraging and suggests its product is a genuine meal-replacement alternative Youfoodz is capitalised at $155 million. It had $35 rather than a novelty consumers try once or twice. million in net cash at December 2020 and is well funded. The company can build a much bigger brand, Marley Spoon grew its active customer base by 85 particularly among younger consumers who fit its per cent to 362,000 people in third-quarter 2020, meals into their active lifestyle. compared to the same period a year earlier. If it can maintain a high level of repeat business, the company As a newly listed micro-cap, Youfoodz suits should achieve a faster growth rate that drives the experienced investors who are comfortable with next leg of its share-price rally. higher risk. For those who fit the bill, Youfoodz is one of the more interesting micro-caps on ASX at the The well-run Marley Spoon is also growing quickly in current price, given its growth rate in a high-potential the and . Share-price gains meal segment. will be slower from here, but I like the company’s prospects in the global meal-kit market. Chart 2: Youfoodz (YFZ) Marley Spoon shares have been volatile and the stock would have more appeal closer to $2 a share (it traded near there in early December). It’s not for the risk averse.

Better to stand aside for now as the market digests Marley Spoon’s soaring share price in 2020 and the implications for meal-kit demand as COVID restrictions worldwide eventually ease. My hunch is Source: ASX Marley Spoon will eventually be acquired by a larger competitor. The stock has excellent long-term 3. Marley Spoon AG (MMM) potential, but may have run too hard, too fast for now.

In December 2019, I wrote favourably on Marley Chart 3: Marley Spoon (MMM) Spoon for the Switzer Report. Marley Spoon was at 56 cents then. It hit 35 cents at the start of 2020, then soared to $3.55 as COVID restrictions took hold. It’s now at $2.79.

My initial interest was based on potential growth in the meal-kit market and because Woolworths took a small stake in Marley Spoon. Bigger tie-ups between grocery chains and popular meal-kit providers are a Source: ASX no-brainer as demand for meal-kits grows. Tony Featherstone is a former managing editor of Marley Spoon is releasing its quarterly results as this BRW, Shares and Personal Investor magazines. The

Thursday 28 January 2021 04 information in this article should not be considered personal advice. It has been prepared without considering your objectives, financial situation or needs. Before acting on information in this article consider its appropriateness and accuracy, regarding your objectives, financial situation and needs. Do further research of your own and/or seek personal financial advice from a licensed adviser before making any financial or investment decisions based on this article. All prices and analysis at 27 January 2021.

Thursday 28 January 2021 05 What’s on the fast food menu? by Tim Boreham

According to research house IBISWorld, the $20 Collins retains 64 Sizzlers outlets in and billion fast food sector has grown at a steady 1% per – where the brand remains popular – and also annum over the last five years, with 2021 has 13 outlets, 10 of them in . performance expected to dip 0.8% as a result of the pandemic that crimped in-house dining. For the time being, Collins Food’s fortunes hinge on the fortunes of KFC, with the chain facing elevated Amid these resilient trading conditions, the menu of competition from key rival . Owned by ASX-listed plays is likely to expand, with Craveable Brands, Red Rooster has introduced a mulling a listing of its local operations. fried chicken menu that is more aligned to KFC’s – despite KFC changing its name from Kentucky Fried The fast-growing was also gearing Chicken some years ago. (Red Rooster, by the way, up for a local IPO, but these plans were put on ice used to be an awkward appendage of the Coles Myer after funds manager Magellan took a 10% $86 million empire). stake late last year. But never say never. In the midst of a pun-based advertising war that so far Pizza Hut is a daggy name here, although baby has avoided fowl play, it remains to be seen whether boomers would remember the all-you-can eat dessert KFC or Red Rooster which customers will be the bars with affection. While Dominos Pizza Enterprises most ‘satisfried’. (DMP) has blitzed Pizza Hut on sales in recent years, private equity owner Allegro is renovating Pizza With 9 to 12 new KFC outlets planned for the current Hut’s operations including a streamlined menu and a year and 66 by 2028, can’t be accused tech overhaul – but no return of the germ-incubating of playing chicken in the perennial fight for the wallets dessert bars in these virus conscious times. and stomachs of price sensitive consumers.

To date, investor choice has been largely limited to In a pre-Christmas update, Collins Foods reported a the all-conquering Domino’s and Collins Foods hearty 12% boost in same-store sales for the 24 (CKF), which owns 244 KFC outlets, 152 in weeks to October 18. Revenue rose by 11 per cent to Queensland and 49 in WA. $500 million, but its reported profit slid 19% to $16.5m after $3.3m of closure costs were taken into Elsewhere, the KFC outlets are largely account. owned by the New York Stock Exchange listed Yum! Brands (formerly Pepsico) and the Kiwi based Collins Foods (CKF) Restaurant Brands (see below).

In another blow for all-you-can eat nostalgia, Collins last year closed the last nine of its Sizzler’s outlets, which had survived the dining trends since the1980s but fell victim to the pandemic with its dine-in only model.

Thursday 28 January 2021 06 Source: Google Brands is often overlooked in the pantheon of quick service restaurant plays, but is fast expanding from its With an increasingly international focus, Domino’s is home base. scheduled to report its first (December) half numbers on February 17. At its November 30 strategy day, The company’s original remit was acquiring the NZ Domino’s key ‘takeaway’ message for investors rights to KFC and Pizza Hut. But the company was improving profitability for its underperforming acquired 63 KFC outlets in NSW and then in Japanese operations and also better profitability in December 2019 shelled out $US73 million ($95m) for Germany and France on the back of increased 70 KFC (or combined KFC/Taco Bell stores) in average orders. southern .

In Germany, online order sizes have averaged The company’s December half performance was €22-25 ($34-39), compared with only €9 for pick-up virus affected, with revenue down 13 per cent to orders. $NZ383 million ($358m) and net profit declining 43 per cent to $NZ11.4m. “When a large franchise has strong momentum and franchisee profitability is strong this leads to an The company derived just under half of its revenue increased appetite for new stores – Domino’s largest from its home turf and roughly one quarter from growth driver,” notes broker Morgans. Australia and the US: a balanced diet in investor terms. A key threat for Domino’s is rising cheese prices which can cost a motza (rella), given the processed Restaurant Brands (RBD) dairy derivative is the chain’s biggest ingredient cost.

Valued at a hearty $15 billion, Domino’s consistently has trade on elevated earnings multiple – currently around 33 times expected current year earnings. The company has had its glitches along the way but has delivered for customers as well as investors: the shares listed in May 2005 at $2.20 a share. Source: Google Domino’s Pizza (DMP) Oliver’s Real Food (OLI)

Unlike its unhealthier fast food peers, Oliver’s hasn’t benefited from the pandemic because its stores are located on the main arterial highways.

No lockdowns equal no traffic, except for burly truckies who aren’t exactly Oliver’s target market Source: Google and this one has not been a healthy choice for investors, having listed in June 2017 at 20 cents a Despite KFC’s solid showing, Collins shares have share. The stock traded as low as 2 cents in mid marked time over the year, with the company valued 2019. at $1.15 billion (including net debt of $170 million). The stock listed in August 2011 at $2.50 a share. Oliver’s redemption lies with a licensing agreement with EG, by which the service station owner stocks Restaurant Brands (RBD) Oliver’s fare at its outlets, with discrete shelving and signage under the Oliver’s Food to Go banner. EG in The Auckland based but dual listed Restaurant March last year lobbed a 10c a share takeover offer

Thursday 28 January 2021 07 for Oliver’s as a whole, but the unfolding pandemic put paid to that.

Oliver’s retains the IP and benefits from any uptick in goodwill from this “franchise in a fridge” arrangement which has so far been implemented at 114 EG servos

The dire effect of the bushfires and the pandemic meant that Oliver’s reported a $17.5 million loss in the 20019-20 year. But as chairman Jason Gunn told holders at last Friday’s virtual AGM, an underlying loss of a mere $70,000 was the “best possible outcome”.

Management didn’t take a punt on current-year guidance. But in the short to mid term, Oliver’s should be in a better spot with tis organic, vegan, gluten free alternatives so beloved of millennials.

We’re not so sure what travelling toddlers will think of the green bean ‘chips’, though.

Oliver’s is currently valued at $20 million. The stock is well worth keeping on the investment menu, assuming it can emulate Collins Foods turnaround experience.

Oliver’s Real Food (OLI)

Source: Google

Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regard to your circumstances.

Thursday 28 January 2021 08 Buy, Hold, Sell – What the Brokers Say by Rudi Filapek-Vandyck

In the good books CORPORATE TRAVEL MANAGEMENT (CTD) was upgraded to Outperform from Neutral by Credit ASX (ASX) was upgraded to Equal-weight from Suisse Underweight by Morgan Stanley Credit Suisse has upgraded its rating on Corporate Rating is upgraded to Equal-weight from Travel Management to Outperform from Neutral with Underweight. Target rises to $72.90 from $67.90. the target rising to $22 from $13.60. The broker Industry view: In-line. ASX has underperformed the anticipates 2022 to be a good year from an earnings Australian market by circa -25% in the last 3 months perspective led by a strong top-line from pent up with its P/E premium versus global peers down to demand, share gains, and profitability due to circa 10% from circa 30%. Morgan Stanley highlights cost-containment during the pandemic. The the headwinds which include multi-year subdued importance of in-person interactions is being futures volumes and upward pressure on underappreciated currently, asserts Credit Suisse and technological and operating risk spending to ensure believes the company will grow share due to its global trading stability, as well as heightened regulatory footprint and in-house built technology. scrutiny. In the medium-term, ASX will have the option to earn via monetising data supported by HOLDINGS (HVN) was CHESS replacement and building a PEXA upgraded to Overweight from Equal-weight by competitor, suggests the analyst. Morgan Stanley

CHARTER HALL REIT (CQR) was Morgan Stanley considers two upgraded to Accumulate from Hold by Ord underlying thematics (excluding covid) while Minnett analysing the consumer sector. The broker has a constructive view on the housing market and expects Ord Minnett shifts its preference towards hardware, appliances and furniture retailers to grow. non-discretionary convenience retail REITs like Consumer electronics are expected to lag. Regional Charter Hall Retail REIT and upgrades its rating to Australia’s economic backdrop is considered Accumulate from Hold. Target is unchanged at supportive by the broker with the last three years of $4. Ord Minnett expects 2021 to be another severe drought conditions now reversing. Both interesting year for the property sector with relatively these thematics are expected to help Harvey Norman attractive sector pricing and healthy balance and the broker upgrades its rating to Overweight sheets. Fundamentals are expected to remain strong from Equal-weight. Target rises to $6 from $5.30. for the industrial, self-storage, grocery-anchored retail industry view moves to Attractive from Cautious. and long weighted average lease expiry (WALE) assets with listed owners continuing to grow via (NAB) was M&A. Office and retail malls may face some structural upgraded to Neutral from Underperform by challenges and this is likely to create volatility and Macquarie provide selective investment opportunities, assesses the broker. In a review of the bank sector, Macquarie analysts maintain a neutral view and continue to see the

Thursday 28 January 2021 09 operating environment as challenging. The pressure the target rising to $2.60 from $2.50. Fundamentals on revenue from margins and fees is considered to are expected to remain strong for the industrial, remain and is not fully reflected in consensus. While self-storage, grocery-anchored retail and long valuations appear stretched to the broker, rising bond weighted average lease expiry (WALE) assets with yields are likely to push even higher. Macquarie listed owners continuing to grow via M&A. Office and upgrades FY21 earnings for National Australia Bank retail malls are expected to face some structural by 5-15% because of lower impairment charges, challenges with the full impact on valuations while EPS changes in outer years are less uncertain. This is likely to create volatility and provide material. As the downside risk relating to credit quality selective investment opportunities, assesses the appears less likely, and with better underlying trends broker. than peers, Macquarie lifts the rating to Neutral from Underperform and the target is increased to $24 from MOUNT GIBSON IRON (MGX) was downgraded to $22. Neutral from Buy by Citi

WEBJET (WEB) was upgraded to Outperform As a result of the lower shipments and higher opex from Neutral by Credit Suisse revealed in the December production report, Citi lowers FY21 and FY22 EPS forecasts by -25% and Credit Suisse has upgraded its rating on to -5%, respectively. The rating is also lowered to Outperform from Neutral with the target rising to $5.4 Neutral from Buy, largely due to the 45% share price from $3.7. The broker anticipates 2022 to be a good rally over the last three months. December quarter year from an earnings perspective led by a strong production and shipments were in-line with the top-line from pent up demand, share gains, and broker’s expectations, while lower shipments are profitability due to cost-containment during the expected for Koolan due to a wet season interruption pandemic. Webjet is expected to gain share as and a localised rockfall event. volumes recover in both B2B and B2C segments. Within B2B, the company’s ability to access funding REECE (REH) was downgraded to Reduce from increases its appeal, notes the broker, while within Hold by Morgans B2C, the initial travel activity will likely be skewed towards domestic travel. Morgans revises exchange rate forecasts for a number of internationally exposed stocks. After In the not-so-good books averaging US72.5 cents in the first half of 2021, the broker forecasts an average of CSL (CSL) was downgraded to Hold from US75.5 cents in the second half. The analysts also Accumulate by Ord Minnett forecast an average rate of US79 cents in FY22 and US78 cents in FY23, with a long-term rate of US74 Ord Minnett downgrades its rating on CSL to Hold cents. Morgans also updates AUD/EUR, AUD/GBP from Accumulate. Target falls to $306 from and EUR/USD assumptions, amongst others. For $293.70. The rise in covid cases across the US has Reece, downward revisions to earnings forecasts slowed down the plasma collections recovery, have been due to the stronger Australian observes Ord Minnett, raising the risk of a shortage of dollar. Morgans calculates the current valuation is immunoglobulin in the coming months. The broker stretched and the rating is downgraded to Reduce sees downside risk to its FY22 estimates while from Hold. The target price is decreased to $11.45 conceding the plasma issue will likely be a short-term from $11.60. challenge that will resolve as vaccines are rolled out. SHOPPING CENTRES PROPERTY GROUP (MGR) was downgraded to Hold GROUP (SCP) was downgraded to Hold from from Accumulate by Ord Minnett Accumulate by Ord Minnett

Based on valuation, Ord Minnett downgrades its On the basis of price-to-book ratios and dividend yield rating on Mirvac Group to Hold from Accumulate with spreads becoming too wide, Ord Minnett downgrades

Thursday 28 January 2021 10 its SCA Property Group to Hold from Accumulate with the target rising to $2.60 from $2.55. Fundamentals are expected to remain strong for the industrial, self-storage, grocery-anchored retail and long weighted average lease expiry (WALE) assets, suggests the broker, with listed owners continuing to grow via M&A. Office and retail malls are expected to face some structural challenges with the full impact on valuations uncertain. This is likely to create volatility and provide selective investment opportunities, assesses the broker.

SYRAH RESOURCES (SYR) was downgraded to Neutral from Outperform by Credit Suisse

Credit Suisse notes no change to the status quo at Syrah’s Balama facility which remains suspended due to soft graphite prices and an adequately supplied market. Given only a circa 10% increase in graphite fines prices when Syrah has been absent from the market, the broker does not consider the demand sufficient to warrant a restart anytime soon. A Balama restart is forecast for the last quarter of 2021. Rating is downgraded to Neutral from Outperform with the target price rising to $1.25 from $0.70.

The above was compiled from reports on FNArena. The FNArena database tabulates the views of seven major Australian and international stockbrokers: Citi, Credit Suisse, Macquarie, Morgan Stanley, Morgans, Ord Minnett and UBS. Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regard to your circumstances.

Thursday 28 January 2021 11 Questions of the Week by Paul Rickard

Question 1: Are Downer EDI (DOW), IAG and Question 3: Are there any lithium companies that (AMC) long term holds? excite you at the moment?

Answer: IAG and Amcor are in my income and Answer: If I wanted to play lithium, I would look at growth portfolios – so they are long term holds. Galaxy Resources (GXY) or (PLS). Amcor is being impacted by a higher Australian dollar. According to the broker analysts, they have I said a couple of months back, as crazy as it target prices of $5.46 for IAG (about 11% upside) and sounded, if I wanted to play the whole $17.03 for Amcor (about 18.9% upside). EV/lithium/batteries theme, I would probably invest in Tesla. At the time, Tesla was massively overvalued at Downer EDI is a restructuring story. I have never USS430 – yesterday it was even more overvalued, been a huge fan of the company, and I am not sure closing at USS864! Have a look at James Dunn’s whether I am there yet. According to FN Arena, the article on 3 companies involved with batteries: consensus target price is $5.41, about 4.3% above https://switzersuperreport.com.au/the-electronic-vehic the current market price. le-revolutions-here-and-theres-3-stocks-im-watching/

Question 2: I see La Trobe Financial offering over Question 4: What are your thoughts on the Magellan 4% for a one year cash investment. I would Global Fund Partnership offer? The entitlement is in appreciate your thoughts on this product. dollar value instead of unit cost. Why is this so?

Answer: La Trobe Financial is an established and Answer: Please see my article in Monday’s reputable manager. It operates ones of the largest report: credit funds in Australia. It is currently offering a rate https://switzersuperreport.com.au/magellans-partners of 4.3% for a 12 month term account, which is an hip-offer-should-you-invest/ . The entitlement is on a investment in the La Trobe Australia Credit Fund. pro-rata basis of 1 for 4, that is, for every $4 of This fund invests in loans secured by mortgages over current open class units held, you are entitled to real property – residential, industrial, commercial, invest $1 in closed class units. Existing holdings are rural, construction and development. According to the valued at the NAV (net asset value). PDS, it is diversified with about 6028 mortgages supporting the fund. Important: This content has been prepared without taking account of the objectives, financial situation or It is, of course, much higher risk than a term deposit – needs of any particular individual. It does not and that is why you are getting a much higher rate. I constitute formal advice. Consider the think the important thing with higher risk investments appropriateness of the information in regard to your is to ensure that you as an investor are diversified, circumstances. and that you understand what you are investing in. Review the PDS thoroughly and as the old adage goes – don’t invest in something that you don’t understand.

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