Kowloon Motor Bus....

KMB shares have risen 6% this month, 15% over the past 3 months and 29% for the past year. This is addition to an approximately 4% annual dividend, giving shareholders very handsome returns for what I consider a very low risk business. It appears as if insiders know what the public will only know too late, that fares are probably going to be bumped up for the hard working people of Hong Kong to benefit the tycoons that will need to raise money for their China real estate ventures.

Shareholders, amongst some of the weathiest of Hong Kongers, include the Sun Hung Kai Property uber-tycoons that control the company. A few months ago, as reported here, director John Chen was pleading poverty to the Hong Kong Standard in a puff piece that did not look into any of his untrue 'facts' in an article written for what I feel is a thinly veiled and sinister attempt to soften up the market for a fare rise. The problem as I reported here, is that the company earns not only a respectable return on their investments but a return that would be enviable for a company that is subject to competition and not one that operates a franchised bus operation with limited risk to lose money.

So, I am keeping my eye out for the announcement on the fare increase. If you hear anything, please let me know.