First Resources Ltd (SGX:EB5): 3 Reasons to Be Excited and 3 Forensic Red Flags |🦖EP1506

First Resources Ltd (SGX:EB5): 3 Reasons to Be Excited and 3 Forensic Red Flags |🦖EP1506

The market sees a 5.61% yield from First Resources, but the forensic lens sees a net gearing ratio that jumped from 8% to 40% in a single year — a 400% leverage spike to fund a billion-dollar Indonesian land-bank acquisition. That move pushes this name past the 35% Iggy Safety Ceiling, which means the yield is real but the balance sheet buffer that protects it during a commodity downturn has been deliberately thinned. My conditional stance: this is a Watchlist name, not a Sanctuary name, until gearing trends back below 35% by end-2026.

The question for a 5,000-point STI era is whether 91 basis points above our 4.7% forensic hurdle — itself built on the 3.2% Iggy Floor plus a 150bps risk premium — is enough spread to compensate for commodity risk, leverage risk, land-tenure risk, and currency risk simultaneously. With the latest T-bill clearing at 1.46%, the risk premium you are collecting is 4.15 percentage points. That is not free money. It is the price of monitoring this position quarterly, not parking it and forgetting it.

📺 YouTube: https://youtu.be/hHT6TDD0my0

📩 Substack: https://investingiguana.substack.com/p/first-resources-ltd-sgxeb5-3-gems