Axiata – Regional Mobile Champion

Axiata, the Malaysia leading Telecommunication Group has been our all time favorite stocks in Bursa Malaysia. Since the demerge exercise of TM & TMI (Axiata) back in 2009, Axiata has then begun its plan to become a Regional Mobile Champion. To date, Axiata classified as one of the most cheapest & high growth Telecommunication Group in Asia. Last month, Axiata once more crowned “Best Telecom Group of the Year” for the third consecutive year by Frost & Sullivan.

Axiata once entered it’s ‘dark’ time due to seemingly ‘overprice’ bought 15% of IDEA Telecom, forked out almost RM 6 billion to pair it’s shares in Spice Telecom after the merging of IDEA & Spice. Altogether, Axiata own 19% of IDEA. In financial year 2010, Axiata had reduced its investment value in IDEA for about RM 1 billion ringgit under impairment loss which lead Axiata fourth quarter 2010 into red.

With 100% share holding on Celcom (M) Berhad, Axiata seems far from it’s fair value. Although Celcom performance currently just below Maxis, most of FH valued Celcom only at around RM 25 – 30 billion which translated into RM 3.00 – 3.50 per share compare to Maxis market capital at RM 41 billion. 

Early this year, Celcom & Digi signed an MOU for Advanced Network collaboration which could see a saving of RM 2.2 billion for both companies in 10 years. The saving figure expected to be seen as early as Year 2012 from both Opex & Capex.

*Source OSK

*Source: OSK

Meanwhile, Axiata is currently sitting on ‘huge cash’ and considering no M&A activities in near term, most analysts expect a special dividend will be announced soon. The return of this excess cash estimated to be ranging from RM 0.60 – RM 1.00 per share.

In addition, mobile telecommunication companies are expected to benefit should government allow them to pass 6% service tax to their prepaid subscriber. This translated into an estimated of 3.5% of revenue and 8.5% profits boost for Celcom in 2011. Celcom is currently having 77% prepaid customer.

Below are latest target price for Axiata. The average target price for all 12 FH is currently at RM5.89 which is 16.4% above the stock closing on 15-Jul-11, at RM 5.06.

At current shares price (RM5.06), Axiata Market Capital is at RM 43 billion. Based on FY2010, Axiata PER was at 24 times and FY2011 forecast profit at RM 3.1 billion, it’s PER will be at only 13.6 times. No wonder most of FH (financial house) giving outperform & overweight call for Axiata shares. Telecommunication companies PER normally ranging from 17 - 20 times, with Maxis currently at 17.9 and Digi at 19.7 times. Given Axiata PER estimated at 17-20 times for it’s forecast FY2011 which at RM 3.16 billion, Axiata stock prices might shoot up between RM 6.32 to RM 7.44 in Year 2012.

Bumi Armada IPO final price at RM 3.03



Bumi Armada announced today it’s IPO price at RM 3.03, 12 sen or 3.8% below it’s original IPO price. This bring Bumi Armada market capitalization of RM 8.87 billion after listing and PER of 25 times. The company set to rise RM 1.95 billion from the IPO exercise.

A total 614.632 million shares application received for 58.569 million shares available for retail subscription, represent 9.5 times. To be exact, Bumiputera application oversubscription by 5.19 times and Public application oversubscription by 13.8 times the allocated shares.

Details of the shares allotment for retail applications are as per below :



Source: Malaysia Issuing House



Source: Malaysian Issuing House


 

 







BUMI ARMADA IPO at RM 3.15 –Year 2010 PER at 26 !!

Few days ago, Bumi Armada have publicly announced it’s IPO and target to be listed on 21-Jul-2011. At retail offer price of RM 3.15 Bumi Armada market capital would be at RM 9.2 billion upon listing.

A bit on the company’s background, Bumi Armada was formed in 1995 and previously listed on Bursa Malaysia on 25-Jun-2011. On 18-Apr-2003, the company decided to be delisted prior to restructuring plan in Year 2005.

Bumi Armada provide offshore services via 4 business units which are, FPSO, OSV, T&I and OFS and 2 support units namely FMS and EPC.

Details of the offering are as follow :

         i.            Retail Offering   - 79,861 million shares

a.       Malaysian citizen                              : 58.569 million shares

b.      Directors & eligible employees         : 21.292 million shares

       ii.            Institutional Offering - 798,677 million shares

IPO Summary

On 20-Jun-2011, Bumi Armada entered into master cornerstone investors placing agreement of 300 million shares which represent 10.24% of the enlarge issued & paid up after the IPO exercise.

Final retail price will be determined after the Institutional Price fixed on the Price determination date and will be the lower of

         i.            Retail Price of RM 3.15 per share

       ii.            The institutional Price

Institutional price will be determined by a bookbuilding process wherein institutional investors were invited to bid for portions of the offering by specifying the number of IPO shares and price they would prepare to acquire. Bookbuilding process commenced from 28-Jun-2011 to 8-Jul-2011. From there, Institutional Prices will be fixed.

Market talk has been rife that Bumi Armada’s IPO has garnered strong interest from foreign and local institutional investors, with sources disclosing that the company saw its institutional offer 5.6 times oversubscribed on the first day its bookbuilding exercise.

For the financial year ended Dec 31 2010, Bumi Armada posted total revenue of RM1.24 bil and profit of RM350.1 mil, compared with a turnover of RM732.1mil and net profit of RM277.4mil for FY09. 84.8% of its revenue for FY10 were derived from outside Malaysia.

Financial Year Summary



NEW IPO – PRESTARIANG BERHAD & INARI BERHAD

2 new IPOs announced yesterday which can be categorized as small caps.


IPO Details

INARI target to be listed on Ace Market of Bursa Malaysia on 19-Jul-11. As much as 10 mil shares to be made available for Malaysian Public at RM 0.38 per share, INARI will see a proceed of RM 31.54 million from the IPO exercise.

INARI, incorporated back in 2010, is an EMS provider involved in semiconductor packaging, which comprises back-end wafer processing, package assembly and RF final testing for the semiconductor industry.

INARI intends to pay dividend of up to 40% of net profit in each financial year. Based on Year 2010, the PER is stood at 8.3 with estimated dividend yield at almost 2% of the offered price.

 

PRESTARIANG is an ICT service provider, focusing on ICT Training and certification, software license distribution and management.

The company which also incorporated in Year 2010, target to be listed in Bursa Malaysia Main Board on 27-Jul-11 and offering 8 mil shares to the Malaysian Public. It’s expect to gain RM 19.8 million from the IPO exercise.

PRESTARIANG proposed to distribute dividend of up to 50% of the PAT for at least 3 years after the IPO exercise. PER for PRESTARIANG for year 2010 is at 13.1 with estimated dividend yield of 3.4% of the offered price.

 

Financial details

Excellence Debut for MSM Holding

Wow ! It’s all we can say to an impressive debut for MSM at Bursa yesterday. At 9.01am, the stock surged 91 sen to RM 4.41 which is 26% above its institutional offer price & 30% against it retail offer price.

The stock continues its momentum in the morning & afternoon session. At the closing, MSM surged almost 40% to close at RM 4.89 and was the most active stock with 101.92 million shares being traded.

Point to note that AmResearch has valued MSM at RM4.53 per share while RHB Research Institute had a fair value of RM4.90 to the shares. With these lower target prices for the stock, we might see a profit taking activities in near term. Based on FY2010, MSM currently being traded at 16.2 PER.

Old Town White Coffe - Apply or Not to Apply?

Old town, incorporated in 1999 successfully commercialized their instant 3 in 1 coffee mix under the OLDTOWN Brand name in the same year. A year later, they already in Singapore market with the same product. 4 years later, in 2005, Old Town successfully penetrated USA, UK,  Taiwan as well as Indonesia.

First OLDTOWN WHITE COFFEE café outlet was open in Ipoh back in 2005. To date, Old Town outlets already reach 182 café outlets not only in Malaysia, but also Singapore & Indonesia wither partially, fully owned as well as franchised.

Based on enlarged issued and paid-up share capital of 330 million shares upon listing, PE for Year 2010 stood at 12.9 times with net EPS at 9.6 sen per share.

Old Town had declared the Dividend Policy of minimum 50% of the Group annual profit. Based on Year 2010 net profit at RM 31.9 million, the dividend is around 4.8 sen per share which translated into 3.8% dividend yield based on IPO price of RM 1.25.

The offered shares details as below :

Public Issue        :

·         Malaysia Public - 10 million shares

·         Directors & employees – 5 million shares

·         Identified Investors – 48.4 million shares

Below are summary on the IPO :

Financial Year Summary

Note: Old Town White Coffee is my housemate's favourite! :D

Eversendai IPO

Hi folks..so sorry for the silence.., well..what can we say.. still feeling disappointed for being unlucky on the MSM IPO. Last 2 days, we got refund from the MSM application. L Anyway, the past is the past and life goes on. Perhaps we will be luckier in our next IPO application. So moving on, let discuss on Eversendai IPO..shall we?

Eversendai had made official offering last Wednesday; 15-June-2011 and the offering is scheduled to be last to a week later, 21-June-2011.

Source: Eversendai Prospectus

Lets discuss about the company background first ya..Eversendai which incorporated in Malaysia back in 1993, are internationally recognized and established structural steel turnkey contractor and power plant contractor.

Before entering Middle East market, the group involved in various structural steel works for buildings in Malaysia such as Dayabumi, Shah Alam Proton car plant, KL Tower, KLCC, and also KL Sentral.

The group then entered the Middle East market in 1996 and awarded with few Mega project including Burj Al Arab, Emirates Tower, Gate building, Dubai Mall – Dubai, Khalifa Stadium, New Doha international Airport – Qatar, Capital Gate Building – Abu Dhabi, Kingdom Center – Saudi Arabia, and also world tallest building in the world, Burj Khalifa at 828 metres / more than 160 stories high.

 

 

In general, the group had presented in many landmark projects, not only in Malaysia but also Singapore, Thailand, Philippines, Indonesia, Hong Kong, Oman, Saudi Arabia, Bahrain, Qatar and UAE.

The Group had name themselves as one of the expertise in power plant construction works such as Jana Manjung Coal power plant, Tanjung Bin Coal power plant, Jimah coal power plant and currently undertaking North Chennai power plant project in India.

Summary of awarded contract value from year 2008 – 2010 are as below :

Back to the IPO business, the IPO priced at RM 1.70 for retail and will be subject to 95% of institutional price, whichever lower.

A total of 232.19 million shares to be offered which translated into 30% of the enlarge share capital after the IPO of 774 million shares.

The offered are details as below :

i. Institutional Offering : 202.04 million shares
ii. Retail Offering :
    · Malaysia Public - 20 million shares

    · Directors & employees – 10.15 million shares

 

 

Below are summary on the IPO :

Financial Year Summary