Posted by Ooi Teik Bee > 2012-07-26 10:15 | Report Abuse

Dear KC Loh,

What is the fair price for L&G ? Technical chart for this stock is good.

Please advise.

Thank you.

Ooi

Posted by KC Loh > 2012-07-26 11:30 | Report Abuse

If I add L&G GDV into equation, my FV is 69 sens after 15% discount. Huh? Could be a good buy! Need to research more. Their office is near my house :)

Posted by Ooi Teik Bee > 2012-07-26 11:46 |

Post removed.Why?

Posted by KC Loh > 2012-07-26 12:00 | Report Abuse

mine is just a simple preliminary calculation. Please bear in mind i dont have all the facts. Need more research.

No dinner necessary. I am more than happy to dispense whatever i know here to help out. Thank you for your kind invitation nonetheless.

Posted by KC Loh > 2012-07-27 00:32 | Report Abuse

Ooi, reading at what is written about L&G management, i think the new management under this HK based Tan Sri guy looks promising. He has managed to cut admin cost from 26% to about 10% if i recall correctly. That is quite significant. and he is focusing solely on property/construction business, currently in favor with the market. And their current 20psf landbank in accounting entry is worth conservatively now about 450-550 psf now. Their P/BV will be astounding if they can unlock the value. I think they are and so the more i researched into it, the 66-72 FV range, 15% disc, still holds true for me.

In saying so however, bear in mind that property development has about a 25-month timeline at the very least, so things may happen in the 2 years of construction. Building materials may rise, legal fees, admin and labour, govt policies may change etc etc. the beta of 1.71 says it all. one of their biggest drawback now is their landbank is so tiny! do they have enough book orders to continue past 5 years to sustain earnings? will they eventually pay dividend, like SP Setia or IJM? if they utilize their current cash 141mn to buy landbank, their gearing will be up on cost of borrowing for construction. I note that there are unbill of 200mn+ still to come. so that might help a bit. their collection policies for sales also needs to be inproved on as its not following industry norm. not too sure what info you can get from your source, but best keep an eye for the management aspects before committing a big portion of your capital.

i am still looking at it favorably, because with a discount of 15% (following SP Setia's) its still gives a reasonable margin of safety. But tread carefully, as more research is required.

Posted by luckyman > 2012-08-02 20:56 | Report Abuse

Congrats to those who started to buy a few months ago. :-)

Posted by KC Loh > 2012-08-03 11:22 | Report Abuse

Ooi, did you manage to buy into it? market is valuing the counter already. hope you doing well here

Posted by smartguy > 2013-07-01 22:43 | Report Abuse

L&G buy buy buy