JIT News - SP Setia,Hing Yiap,SelProp,Tenaga,QL.. 18/1/2011

SP Setia: It has confirmed securing 40 acres of prime land along Jln Bangsar. It also announced a fund raising exercise via a proposed placement of 15% of new shares to be done via book building that could easily raise rm1.14 billion. The fund raising comes tandem with a one for two bonus issue.

Assuming a plot ratio of four to five times and an average selling price of rm1200 psf, the gross development value of the Bangsar land would amount to rm8 billion to rm10 billion. Assumes also that SP Setia has a 50% to 60% stake in the project, the surplus value from the land at a net cost of rm700 million for the 1NIH Complex alone would be around rm550 million or 48 sen per share, boosting the revised net asset value to rm6.21.

SP Setia: 7.23 (OSK), 8.00 (CIMB), 6.90 (MBB), 4.94 (Inter Pacific), 8.05 (RHB), 5.50 (Kenanga), 6.80 (AMResearch), 5.20 (ECM)


Hing Yiap: It has received an unconditional takeover from Everest Hectre Sdn Bhd to acquire all the remaining shares for rm1.500 per share.

Selangor Properties: It is potentially poised to be one of the beneficiaries of the Greater Klang Valley MRT project. Currently it has a 34 acre developable land bank and 1.2 million sq ft office space in Pursat Bandar Damansara, where an MRT interchange could possibly be developed. It is in good position to bid for the MRT interchange at Pusat Bandar Damansara to be located in its site.

The group is majority owned by Kayin Holdings Sdn Bhd which holds 66.3% interest. Its cash and cash equivalent amounted to rm598 million as at Oct 2010, against debts of rm397 million. This means that it was sitting on a net cash position of almost rm200 million. It had not undertaken any equity fund raising exercise over the past decade. It has a book value of rm5.12.

Industry observers are of the view that since some of Selangor’s assets are ripe for revaluation, the shares’ prevailing discount to its book value could become even wider … A research house said the strongest RNAV growth over the next three to five years is expected to hit rm11.71 per share by then based on land value appreciation. Given its strategic land bank, attractive valuation and concentrated shareholding, it could be a potential M&A or JV target or privatization candidate.

Tenaga: Its earnings for the first quarter of its financial year ending Aug 31 (FY11) is expected to fall due to lingering concerns of rising coal prices.

QL: It has completed the book building exercise for the offering of 20.83 million new shares pursuant to its private placement exercise to raise rm116.6 million, It has been fixed at rm5.60 per placement share.