Reuters reported that Sime Darby has indefinitely postponed an initial public offering of its motor business that bankers had said could raise up to $500 million. The report also quoted a SIME spokesman as saying that the IPO had  been  deferred  "until  the  market  is  conducive  for  the  exercise".  The motor business IPO was first delayed in February to 2H15. (Source: Reuters)

Comments:  It does not make sense to launch an IPO if the pricing is not attractive to the issuer or demand for IPO shares is lukewarm. It therefore make sense for SIME to defer the motor business IPO if the “market is not conducive for the exercise”. We maintain our HOLD rating for SIME with an unchanged  TP  of  RM8.96  based  on  16x  2016E  EPS.  Core  divisions continue to face challenges, including the plantation business, which may be  negatively  impacted  when  the  Indonesian  government  impose  export levy to subsidise biodiesel production

Source: Affin Hwang Capital Research - 6 May 2015