LOOKS TO DIVERSIFY PORTFOLIO TO REDUCE RISK
Believes exposure in other sectors healthy in case of any crisis as current portfolio to skewed
Fijian Holdings Group is looking to increase its exposure in other sectors to diversify its existing portfolio. FHL Group chief executive, Nouzab Fareed, said at this stage, their portfolio is more skewed towards tourism, finance and retailing. Mr Fareed made these comments as the FHL Group held its annual general meeting yesterday at the Grand Pacific Hotel in Suva. “So we are looking at ways and means of diluting this exposure and increasing our exposure to new sectors,” he said. “The reason being a good portfolio should have good diversification.
“So right now FHL is well-diversified – we are into property, manufacturing, building and construction, media, retailing, tourism, finance. “But at the same time, tourism, finance and retailing is almost accounting to more than 60 per cent. We want none of the sectors should be more than 20 per cent.”
Mr Fareed said this will be their safeguard in case of crisis. “For example there can be a tsunami, a failure of financial market globally, there can be issue with disposable income and so we will still be safe,” he said.
“The portfolio is fine but it is better to increase our exposure.”
High rate of success Mr Fareed told shareholders that to date – for the past 32 years of FHL’s existence, FHL has made investments in 49 companies.
He said out of 49, 29 companies are still active and to date, they have divested 20. “We are very happy to say only four companies have failed. So that basically means, 92 per cent success rate. I wish FHL should continue that trend. “We have to be very careful – we made big blunders with FHL logistics and our PNG operations. But now we are lucky we are out of it.”
FHL’s current group asset stands at $475 million but Mr Fareed said they believe within the next two to three years, this will reach $600 million. When Mr Fareed took over the chief executive position in 2011, the investment portfolio for the company was below $150 million. And now, Mr Fareed said the investment portfolio of FHL Group has reached $257 million.
And perhaps looking at the healthy financials, was the reason Mr Fareed’s contract as the Group chief executive has been renewed for another three years.