Journey to Wealth
Kulim - Announces special dividend of 93 sen/share BUY
- Following QSR Brands' and KFC Holdings Bhd's capital repayment exercise, Kulim Bhd has announced that it would be receiving proceeds of RM1.157bil.
- Subsequently, Kulim has proposed to distribute all of the RM1.157bil proceeds in the form of a special dividend to its shareholders.
- Kulim's special dividend would amount to about 93 sen/share based on the share base of 1.235bil. After the conversion of warrants, we reckon that the special dividend would amount to 82 sen/share.
- We believe the special dividend would be paid in 3QFY12. The date of the payment of the special dividend was not disclosed in the Bursa announcement.
- Recall that Kulim owns 54% of QSR Brands, while QSR Brands owns 51% of KFC Holdings. However, after the conversion of warrants, we estimate that Kulim's shareholding in QSR would be 48% while QSR's equity interest in KFC would be about 49%.
- The announcement of the special dividend was not a surprise. Following the privatisation exercise of QSR and KFC by Massive Equity Sdn Bhd, the market had been expecting Kulim to return part of the capital repayment proceeds back to shareholders.
- What was a surprise was the size of the special dividend. We were not expecting Kulim to distribute all of the capital repayment proceeds as a special dividend.
- We had thought that Kulim would keep part of the proceeds for future expansion plans. Still, we reckon that Kulim would not face any problems financing its future expansion plans as its balance sheet is healthy.
- At the company level, the group's gross cash stood at RM74.8mil as at end-FY10 while gross borrowings amounted to RM373.2mil.
- Most of Kulim's borrowings are held by New Britain Palm Oil Ltd (NBPOL). NBPOL's borrowings would be deconsolidated in the future as it will be classified as an associate.
- We maintain a BUY on Kulim for the special dividend of 93 sen/share. The group would also be a purer plantation company after the disposal of KFC and QSR.
Source: AmeSecurities
More articles on Journey to Wealth
Ekovest: No plan to launch another offer for Iskandar Waterfront City
Created by kiasutrader | Mar 29, 2018
Kenanga Research - On our Portfolio - Parliament dissolution around the corner?
Created by kiasutrader | Mar 25, 2013
Plantation Sector - Proposed accounting standard scrapped OVERWEIGHT
Created by kiasutrader | Mar 25, 2013
Pavilion Reit - Limited upside, earnings upside have been priced in HOLD
Created by kiasutrader | Mar 25, 2013
Discussions
Be the first to like this. Showing 0 of 0 comments
Post a Comment
Featured Posts
Latest Videos
Apps
Top Articles
1
2
4
save malaysia!
Visa-free travel to China extended for Malaysians to 30 days
5
6
7
Good Articles to Share
8
Good Articles to Share
Four convicted in Spain over homophobic murder that sparked nationwode protests
#
Stock
Score
Daily Stocks
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
MQ Trading Signals
Stock
Time
Signal
Duration
No trading signals available.
Stock
Time
Signal
Duration
No trading signals available.
Featured Advertisers / Partners
Ride The Bull Short The Bear
CS Tan
4.9 / 5.0
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
