The Great Stock Market Contradiction: Why BYD's Bigger Numbers Buy a Smaller Price Tag

If the stock market were a simple scoreboard — most revenue wins, most profit wins, most units sold wins — BYD would be beating Tesla on every count. And yet Tesla is worth roughly ten times more. This isn't a myth or an internet exaggeration. It's real, it's current, and it's one of the clearest illustrations of how disconnected a stock's price can be from a company's underlying business.

The Fact-Check

For full-year 2025:

• Revenue: BYD generated about $116 billion (803.96 billion yuan), versus Tesla's $94.8 billion. BYD wins by roughly 23%.
• Net profit: BYD earned about $4.7 billion, versus Tesla's $3.8 billion GAAP net income. BYD wins here too, even though BYD's own profit fell 19% year-over-year due to a brutal domestic price war in China.
• Vehicles sold: BYD delivered 4.6 million vehicles (EVs and plug-in hybrids combined) — nearly triple Tesla's 1.64 million. Even narrowing it to pure battery-electric vehicles only, BYD's 2.26 million still outsold Tesla's 1.64 million.

Despite sweeping all three categories, BYD's market capitalization sits at roughly $110–125 billion. Tesla's sits at approximately $1.2 trillion. Tesla is worth somewhere between 10 and 11 times as much as a company that outsold it, out-earned it, and out-revenued it.

Why the Market Doesn't Care About the Scoreboard

The resolution to this apparent contradiction is that a stock price isn't a report card on the past year — it's a bet on the future. Markets assign value based on expected future cash flows, discounted by how confident investors are in getting them, not on which company had the better trailing twelve months.

Look at the valuation multiples this produces. Tesla trades at roughly 12–13 times sales and over 300 times earnings. BYD trades at roughly 1 times sales and about 24 times earnings. Investors aren't pricing Tesla as a car company; they're pricing it as a bet on autonomous robotaxis, Full Self-Driving (FSD) software subscriptions, humanoid robots (Optimus), and grid-scale energy storage — businesses that barely register in Tesla's current revenue but loom large in its imagined future. BYD, meanwhile, is priced closer to what it visibly is today: a high-volume, thin-margin manufacturer competing in an increasingly brutal price war.

There are other forces at work too. BYD's shares are split across Shenzhen, Hong Kong, and thinly-traded U.S. ADRs, which fragments and discounts its valuation relative to a single, highly liquid U.S.-listed mega-cap like Tesla. Geopolitical risk, less transparent Chinese corporate governance, and a smaller base of Western institutional ownership all add a "discount" that has nothing to do with BYD's factories or balance sheet.

Yet BYD is Technologically Superior to Tesla

On Full Self-Driving (FSD), the assessment indicates that BYD's position is more defensible than Tesla's branding may suggest. BYD's "God's Eye" autonomous driving system is available across three tiers, with the top two incorporating LiDAR sensors—hardware that Tesla has deliberately excluded in favor of a camera-only approach. Reports indicate that the entry-level God’s Eye system averages more than 1,000 km between human interventions, is offered as standard on vehicles priced below $10,000, and, notably, BYD accepts liability for accidents occurring while the system is engaged.

In contrast, Tesla has marketed its system as "Full Self-Driving" but has not assumed liability for accidents involving the technology. Furthermore, a U.S. jury assigned Tesla partial responsibility in a fatal incident involving its Autopilot system. This highlights a meaningful distinction between Tesla's branding, which projects a high degree of confidence in its autonomous driving capabilities, and the legal responsibility it is willing to undertake.

The Real Lesson

This is really the same mechanism explored in questions about dividend yield and stock prices: value isn't just today's numbers divided by today's price — it's tomorrow's expected numbers, discounted by how much risk or uncertainty investors attach to them. A stock market can look "irrational" comparing two companies side by side on last year's results, while still being entirely rational once you account for what each company is being trusted, or not trusted, to become.

However, for Tesla's case, this may not hold true and it is very much an over valued stock due to marketing hype and a cult following which borders on unwise and cult like behaviour of a group of investors. Earnings have stagnated as well and the promised land of exponential earnings a false dawn.

An AI Blueprint to Closing NTT DC REIT's NAV Gap

NTT DC REIT trades at 0.85 times net asset value — a discount that, notably, is not shared broadly across its Singapore-listed peers. That distinction matters. A sector-wide re-rating would point to macro forces: rate expectations, capital flows, sentiment toward the asset class as a whole. A REIT-specific discount points somewhere narrower — the market is pricing something particular to this portfolio.

Three features of the book explain most of it. First, concentration: the top two tenants account for 44% of base rent and the top ten for 75.4%, with a single tenant — an investment-grade multinational corporate — representing 31.5% on its own. That tenant's lease is unusually strong: seven years, with rental escalations and onerous penalty even on early exit. But headline screens used by many analysts and index providers weight concentration by share of income, not by lease enforceability or counterparty credit quality — so a genuinely well-protected exposure still reads, on paper, as a single-name risk. Second, geography: 63.9% of the portfolio sits in one country/sector. Third, and easy to overlook, is the balance sheet itself. At 31% gearing against a 50% regulatory ceiling, and an interest coverage ratio of 4.2 times against a 1.5 times floor, NTT DC REIT is carrying meaningfully more debt capacity than it is using. Unused capacity, left unused long enough, tends to read to the market not as prudence but as inertia.

There's a fourth, quieter issue: strip out the largest tenant and the remaining portfolio's weighted lease life falls to roughly 2.9 years, well short of the 4.2-year blended average. That's near-term rollover risk arriving independently of the concentration story, and it adds earnings uncertainty the market has to price somewhere.

With all the facts in hand, I ran the scenario through an AI model set to its 'Extra' effort setting — reportedly the second-highest reasoning level available. Here's the output it generated:

Closing the Gap: The Capital Allocation Playbook

None of these four issues is fixed by inaction, and none is fixed by picking just one lever.

Run the unit buyback toward the full 10% mandate permitted under its renewed unit buyback, funded from debt or cash rather than equity. At 0.85x NAV, every dollar spent buys back roughly $1.18 of underlying value — a rare, close-to-certain return. With a high daily turnover near 1% of market cap, there is no liquidity or float constraint forcing restraint; the mandate ceiling, not market depth, is the real limit.

In parallel, continue acquiring — not for size, but for diversification. Future deals should be screened for what actually narrows the top-ten and geographic numbers, since the largest tenant's contractual strength already limits the urgency of diluting that specific exposure through growth. Debt headroom supports this: roughly 30% of the current asset base can still be added before the leverage ceiling binds, with even more room on the ICR side. Fund this growth with debt, not fresh units — issuing equity at a discount to NAV gives away the very value the buyback is trying to capture.

Address the rollover risk in the rest of the portfolio directly, through proactive re-leasing and targeted capital expenditure, rather than letting it compete unaddressed against the other two priorities for the same debt capacity.

Finally, communicate the plan via an SGX announcement. If part of the discount reflects unused balance sheet capacity rather than the underlying risk itself, visibly deploying that capacity — and explaining why — will do more for the rating than either lever pulled quietly on its own

Expect a partial, not full, re-rating from the buyback alone. If the discount narrows only modestly once the mandate is used, that confirms the market's real concern is concentration and geographic mix — meaning the acquisition program, not the buyback, holds the key to closing what remains.

<Author is vested in NTT DC REIT>

Why Singapore's IPOs Keep Going Underwater and the Stock Market Flounders: The Tools Are There, But the Bureaucracy Just Doesn't Have the Will

Two SGX listings landed with a thud in the past two months. JustCo closed its first trading day almost 18% below its offer price. Foundation Healthcare, backed by Temasek's SeaTown, had to settle for the floor of its price range despite becoming the largest healthcare IPO since 2012. Read in isolation, both look like evidence that Singaporeans just aren't excited about Singapore stocks.

Read differently, they're evidence of something narrower and more fixable: Singapore doesn't have a returns problem. It has an awareness problem.

The Numbers Nobody's Advertising

The Straits Times Index rose 23% in 2025. In my own writing last month, I ran the actual math comparing a S$1,000,000 unleveraged basket of ten SGX REITs against the same S$1,000,000 used as a 25% deposit on a 75%-geared, rented-out condo. The REIT basket returned a blended 6.68% a year in cash — tax-free, no mortgage, no stamp duty, instant liquidity. The leveraged property, even under generous interest-only assumptions, nets closer to 5.2% after financing and tax, and that's before roughly S$200,000 in stamp duty and legal fees paid just to enter the trade. Over ten years, the gap compounds to hundreds of thousands of dollars in the REIT basket's favour, on identical starting capital.

That's not a marginal result, and it isn't a secret either. MAS has been quietly building the institutional case for Singapore equities for over a year — S$6.5 billion allocated to asset managers under the Equity Market Development Programme, new rules requiring family offices under the Global Investor Programme to deploy meaningful capital into SGX names, board lot sizes cut from 100 to 10 units specifically to make it easier for small investors to buy in. All real, all sensible, and all invisible to the average Singaporean scrolling their phone.

Why the Message Never Reaches Singaporeans

Property has an entire content industry built around selling it: short-form videos, "your tenant pays your mortgage" calculators, agents with six-figure follower counts making the leverage story feel intuitive and inevitable. Nothing on the stock side competes with that, because nothing is designed to. Retail investors don't lack access — brokerage accounts are a five-minute sign-up. They lack a version of the property pitch that's been made for stocks, in the same format, with the same repetition, using real numbers.

That's a solvable gap, and MAS and the Ministry of Finance are two of the few institutions with both the credibility and the reach to close it. A short-form social campaign that simply states, plainly, what a diversified SGX REIT basket returned this year against what a leveraged rental unit actually nets after stamp duty and tax would do more for retail participation than another tax incentive aimed at fund managers — because it fixes the actual bottleneck, which is awareness, not capital supply.

The Catch

Here's the trade-off. A campaign that credibly shows stocks beating leveraged property is also a campaign that talks down the primary asset class of Singapore's most established wealth — households and family offices still holding much of their balance sheet in real estate, with real influence over how economic policy gets discussed and shaped. It also unsettles a newer cohort: professionals who leveraged into a second or third unit specifically to rent to expatriates, and who've built both a balance sheet and an identity around that bet. Hearing, on an official channel, that the math was against them the whole time isn't just an inconvenient fact — it's a status challenge from a source they didn't expect it from.

There's a subtler tension too. CPF and HDB upgrading have spent decades reinforcing housing as a retirement asset for the median household, not just the wealthy. A regulator pushing consumers toward equities and a housing system that depends on property values holding up aren't fully pulling in the same direction, even before anyone's politics enters the picture. One ministry's social media campaign may anger one or two other ministries' political office holders.

So the billions keep flowing quietly to institutions, and the board lots keep shrinking to lower the entry barrier — real progress, but all on the supply side. The blunt, retail-facing version of the pitch — REIT yield next to rental yield, tax-free against taxed, no stamp duty against six figures of it — still hasn't been made. It is up to MAS and MOF to have the (iron) will to speak up. As for Singaporeans, they lose a voice which raises their awareness in helping to build for their financial future.

Japan Foods Holding: Squeezed Dry by Sky-High Rents

Japan Foods Holding Ltd (JPFH) is a familiar name to anyone who has eaten at Ajisen Ramen or its sister brands in a Singapore heartland mall. It's a homegrown F&B success story that has been around for close to three decades. But familiarity and fondness aside, the numbers tell a story that investors should read closely before buying in — and the company's own annual report gives away why.

Boxed in by its own positioning

JPFH's restaurants sit squarely in the low-to-low-middle price segment, with menu items typically priced between $10 and $20. That positioning has been the brand's strength for years — affordable, familiar Japanese comfort food for the everyday consumer. But it is also becoming its biggest vulnerability.

In its FY2026 annual report, the company points to a structural shift in the competitive landscape: an influx of well-capitalised Chinese F&B brands entering Singapore has pushed up both rental and manpower costs across the board. These new entrants aren't just competing for customers — they're competing for the same shop units and drawing from the same limited pool of local and foreign service staff. Backed by deep domestic networks, they are, in the company's own words, willing to spend aggressively to win a foothold in Singapore as a springboard into the wider region.

For a premium or mid-to-premium operator, rising costs can often be passed on to customers who are less price-sensitive. JPFH doesn't have that luxury. Its entire brand promise rests on being the affordable, everyday option — and a $10–$20 price band leaves very little room to raise prices without eroding the value that keeps customers coming back. In short, JPFH is absorbing rising costs from a fight it didn't start, in the one segment where it has the least pricing power to fight back.

The financial results reflect this squeeze. As the chart below shows, JPFH swung from modest profitability in FY2022 and FY2023 into consecutive years of losses from FY2024 onward — with the bottom line deteriorating to a net loss of S$7.9 million in FY2025, before narrowing slightly to a S$6.7 million loss in FY2026.

Its two consecutive years of losses after two years of modest profits lines up with the timeline of increased competitive pressure described in the company's own commentary.

Management's own playbook: survive, don't scale up

Perhaps the most telling signal for investors isn't in the numbers — it's in management's stated strategy. In its latest AGM, rather than moving upmarket to escape the cost pressure, management has been explicit that JPFH will not enter the premium mall restaurant segment. The strategy is to stay in its current lane and manage through the China competition via store rationalisation — trimming the underperforming parts of the network. JPFH expects more local F&B brands to close down due to the competition from China.

That's a defensible survival strategy, but it's important for investors to understand what it does and doesn't achieve. Store rationalisation reduces the drag from loss-making outlets, but it doesn't address the underlying cost inflation hitting every remaining store. My expectation is that even after closing more outlets, the realistic outcome is only a return to breakeven — not a return to the healthier profit margins JPFH posted back in FY2022–FY2023. For a company that once used store expansion as a growth story, the current chapter is essentially about shrinking to survive, as a homegrown brand absorbing the cost of a much more capital-intensive wave of competition.

That is a meaningfully different investment case than "turnaround story." Breakeven is a floor, not a growth trajectory — and it assumes the competitive and cost pressures don't intensify further.

The cost structure means there's no easy lever to pull

The clearest illustration of why JPFH is structurally stuck comes from its own cost disclosure. In response to a shareholder query, the company broke down its FY2026 expense base as follows:

JPFH Cost Breakdown FY2026

Rental and employee compensation together account for roughly 73.5% of these key cost items — and both are precisely the two cost lines that management says are being driven up by the influx of new, cash-rich competitors. Food ingredient cost, by contrast, is only around 18.3% of the base. Hence for many causal chains in Singapore, store and labour is the cost that kills.

This matters because it defines the limits of what operational discipline can achieve. Even if JPFH runs an exceptionally tight kitchen and squeezes every dollar out of its food sourcing (which the CEO claims he does, and does it far better than the China chains), ingredient cost is simply too small a slice of the pie to meaningfully move overall margins. The real cost drivers — rent and labour — are largely outside the company's control, dictated by a property and labour market that competitors are willing to bid up aggressively to win. Staying in the low-end segment means JPFH is committed to a pricing ceiling it cannot easily raise, while its two biggest cost lines are the ones most exposed to external competitive pressure. That combination is difficult to fix through internal efficiency measures alone.

I do not expect any meaningful upside in the share price. At 10–11 Singapore cents, the company is a "Hold" for me, with no expectations of increasing the stake.

Portfolio Update July 2026: Increasing My Highest Conviction Holdings

Over the past month, I made two large additions to my dividend portfolio by increasing my holdings in NTT DC REIT and Daiwa House Logistics Trust and a smal addition in Asian Pay TV Trust.

These purchases have increased my projected annual dividend income to $100,591.61, while  improving the overall quality of my income portfolio.

Buying More of What I Understand

As my portfolio grows larger, I have become more selective with where I deploy fresh capital.

Rather than constantly searching for the next high-yield stock avaliable in SGX, I rather increase my exposure to businesses that I have already spent considerable time researching and have high conviction in. Sometimes the best investment idea is not finding something new, but simply buying more of what you understand well.

NTT DC REIT continues to fit that description. The long-term demand for data centres remains supported by structural trends such as artificial intelligence, cloud computing and digitalisation. Together with healthy rental reversions, a quality sponsor and a visible acquisition pipeline, I believe it remains one of the strongest REITs listed on SGX today.

Why Daiwa House Logistics Trust

Demand for modern warehouses is increasingly supported by supply chain optimisation, third-party logistics providers, manufacturing inventory and changes to Japan's transportation industry. Coupled with positive rental reversions over the past few years, I believe the trust offers attractive long-term income potential while providing diversification away from my other REIT holdings.

Recycling capital

I exited my entire position in Riverstone Holdings. While it remains a good company, I felt my capital could be better deployed to the above 02 REITs, my trust in how this would further strengthen my recurring dividend income.

Looking ahead

Looking back over the past year, my portfolio has gradually shifted from accumulating many different dividend stocks to concentrating capital into my highest-conviction ideas. It is definite that 2027 will be a year where I experience a $100,000 annual dividend inflow.

Dividend (Year to Date)

USD $13,060

HKD $22,599.18 (Alibaba Dividend during this update)

SGD $15,317.38 (NTT DC REIT Dividend during this update)

Why BYD's Profit and Share price Slide Isn't Over: Supplier Rules from CCP

BYD just posted its fourth straight quarter of falling profits. Share prices fell. However, this decline will continue and normalise only at the end of this year, 2026.

The regulation behind the debt spike

For years, BYD ran one of the auto industry's most aggressive supplier-financing models. It paid vendors an average of 275 days in 2023 and roughly 127 days in 2024, often using its in-house "Dilian" promissory-note platform rather than cash — effectively turning unpaid suppliers into a source of free working capital.

That changed in 2025. Beijing's SME Payment Regulation, effective June 1, 2025, legally caps payment terms at 60 days, and bans forcing smaller suppliers to accept non-cash IOUs as a delay tactic. BYD, along with 16 other major automakers, publicly pledged to comply. By Q3 2025, BYD's payment cycle had collapsed to roughly 57 days.

That's good news for suppliers and for industry health — but it eliminated a multi-hundred-billion-yuan interest-free credit line BYD had been quietly running. The company had to replace it with real, interest-bearing debt.

The Hidden Financing Advantage

• Total debt rose from 40.5 billion yuan at the end of FY2024 to 124.2 billion yuan at the end of FY2025 — a 207% jump — and kept climbing to 144.4 billion yuan by the end of Q1 2026, a five-year peak.
• Short-term borrowings alone surged 72% quarter-on-quarter to 66.3 billion yuan in Q1 2026, which BYD attributed to higher financing needs across the group.
• Long-term borrowings climbed to roughly 61.2 billion yuan by Q3 2025, up more than 640% from the start of that year.

The consequence shows up directly in the income statement. BYD's financial expenses hit 2.1 billion yuan in Q1 2026, up 210% year-on-year — implying a base of roughly 680 million yuan in Q1 2025. That's interest cost that didn't exist a year ago, now eating directly into the bottom line at the same time gross margins are under price-war pressure.

It's likely on a full year basis of 2026, BYD's financial expenses will adversely hit its profits.

The profit trend

Q1 2026 net profit attributable to shareholders fell 55.4% year-on-year to about 4.08 billion yuan, down from 9.15 billion yuan — the lowest quarterly profit since 2023 and the steepest quarterly decline since 2020. Basic EPS fell 56.9% to 0.448 yuan. This extends a streak: Q3 2025 profit fell 32.6%, and full-year 2025 net profit fell 19% to 32.62 billion yuan — BYD's first annual profit decline since 2021. Revenue has now declined for multiple consecutive quarters as the domestic price war and the phase-out of NEV purchase-tax exemptions weigh on volumes.

Price target: 20x forward earnings on the 1Q decline rate

Applying the Q1 2026 vs. Q1 2025 net profit decline (-55.4%) directly to full-year 2025 net profit (32.62 billion yuan) as a proxy for full-year 2026 earnings:

• Projected FY2026 net profit: 32.62B × (1 – 0.554) ≈ 14.55 billion yuan
• Shares outstanding: ~9.12 billion (post the July 2025 bonus share issue)
• Projected forward EPS in HKD: 1.85 HKD per share
• Price target at 20x forward P/E (do note many automobile makers price earnings are 9-12 times, so 20 is a very optimistic projection)

The target price is HKD$37

Against current prices of HK$72.45 (H-shares) as of July 1, 2026, this implies a further 50–60% downside.

One of the Highest-Yielding Singapore REIT Isn't in Any Index and it is Causing Singapore Investors to Lose Out

If you build your Singapore REIT portfolio around the FTSE ST All-Share REIT Index — the benchmark most income investors use, and one that even REITs like Starhill Global REIT measure themselves against — there's a good chance you've never seriously looked at United Hampshire US REIT (SGX: ODBU). That's the problem.

UHREIT currently trades with a dividend yield in the 8% to 9% range, well above the broader S-REIT sector average of roughly 6–7%. For a market where investors chase every extra point of yield, that should put it on every income watchlist. Instead, it sits largely off the radar — and the index is a big reason why.

UHREIT is Singapore-listed, but its entire property portfolio sits in the United States. Its tenants are grocery-anchored and necessity-based retail: strip malls and centres anchored by supermarkets and pharmacies, leased to tenants considered resilient to e-commerce — restaurants, home improvement chains, fitness centres, warehouse clubs. This has kept its income relatively stable even as its unit price has lagged, ironically property revenue has been increasing year on year because of built in annual rental escalations and long WALE.

So Why Isn't It in the Index?

Here's the part that should give investors pause: it's not earnings, tenant quality, or balance sheet stress keeping UHREIT out. It's trading liquidity.

FTSE Russell's index methodology screens for free float and trading liquidity, not just market cap, to ensure constituents can be bought and sold at scale without distorting the price. UHREIT's smaller free float and thin daily turnover don't clear that bar. And low turnover is self-reinforcing: less liquidity means less index eligibility, which means less visibility, which means even less turnover.

This is a structural quirk, not a quality signal. But because so many Singapore income investors use index membership as a shortcut for "is this REIT worth considering," or just buy the REIT ETF, UHREIT ends up invisible to the very crowd hunting for higher yield. In plain sight, Singapore investors are missing out on a 8.4% dividend yielder!

The Cost of the Blind Spot

REIT ETFs that track the index never buy a single unit of UHREIT, no matter how attractive the yield gets, simply because the rules exclude it. Investors who use "is it in the benchmark" as a screen filter it out before ever checking the lease structure or payout coverage. REITs that benchmark themselves against the index never have to stack up against UHREIT's payout, because it isn't part of the comparison set. The result: capital flows toward index members partly because they're index members — not purely because they're the best income vehicles on the exchange. Singapore investors and fund manager lose out on the extra yield and opportunity to outperform Singapore REIT index any time or date of the year.

The Takeaway

If your approach to REIT investing starts and ends with "what's in the index," you may be filtering out some of the highest-yielding options on a technicality that has nothing to do with income quality.

That doesn't mean buy blind, though. Worth noting: UHREIT's illiquidity isn't a case of a thin order book or wide spreads — there's decent volume sitting on both the bid and ask at most price levels. The "low liquidity" here is really low daily turnover, not a shallow market, which is a more benign form of illiquidity. Still, size positions sensibly and do your own homework on debt maturities, occupancy, and currency risk first. But if you've never considered UHREIT simply because "it's not in the REIT index," that's a gap worth closing — the index is a tool, not a verdict.