Reference and Assumption:
1) Harn Len sold 2124 ha Leasehold (Pahang) at 86,000 / ha. Assume Freehold in Pahang and Kedah also equal to this.
2) Pinehill sold 3642 ha Leasehold (Perak) at 110,000 / ha. Assume Freehold in Perak and Johor also equal to this.
3) United Malacca sold 1021 ha Freehold (Melaka / N.Sembilan) at 171,000 / ha. Assume Freehold in Melaka, N.Sembilan and Selangor also equal to this.
Market Value greater than Book Value by 27606m, or RM3.99 per share.
The NTA per share of SIMEPLT is RM2.10.
Therefore, the true value of SIMEPLT should be 2.10+3.99 = RM6.09, which is very much higher than the share price of RM3.79.
For 2021, SIMEPLT's EPS should be around RM0.38, the PE is around 3.79/0.38 = 10 times.
However, the CPO will eventually come down to, say CPO is selling at 10 years average of RM2650.
My estimation show that the EPS of SIMEPLT will be then around RM0.14, or PE = 3.79/0.14 = 27 times.
PE=27 times looks like is expensive, but actually it is not.
Let me show you.
The market value of its plantation estate in Malaysia, my estimation is 36042m.
I believe this value will go up at least 3% per year, you can say it is due to inflation or RM depreciation or both.
36042m*3%=1081m or 1081m/6916m = RM0.155
This RM0.155 is never captured in the EPS calculation.
So the true PE for SIMEPLT = 3.79 / (0.14+0.155) = 12.8 times.
I think it is cheap.
Last one, very important, must say it loud for 3 times.
1) I am not investment adviser, please consult your own investment advisers before trading.
2) I am not investment adviser, please consult your own investment advisers before trading.
3) I am not investment adviser, please consult your own investment advisers before trading.
Created by i3gambler | Jun 19, 2022
Created by i3gambler | Feb 13, 2021