Posted by Stock Kingdom > 2017-06-17 08:42 | Report Abuse

Sunway’s healthcare division, namely Sunway Medical, reported a pre-tax profit of RM37.65mil in financial year 2016.

SAB's Sri Kota Medical Centre, registered pre-tax profit of RM19.4mil in last 4Q

Posted by Stock Kingdom > 2017-06-17 08:43 | Report Abuse

Using Sum of the parts analysis (SOTP), SAB can theoretically obtain higher valuation target

SAB healthcare division registered Profit before Tax of RM19.4mil.
Take 25% tax rate, the net profit will be RM14.55mil.

Applying 20 times PE, the healthcare division itself will be valued at RM291mil

Posted by Stock Kingdom > 2017-06-17 08:44 | Report Abuse

Current SAB market cap = 671mil
Healthcare division = 291mil

Oleochemical & Palm oil fruit/mill division = net profit 42.75mil

Posted by LA777 > 2017-06-17 10:20 | Report Abuse

Lk036, I think it's possible of Sunway share holder get the offer share of Sunway Medical, I am now accumulating Sunway shares cos the future prospects is bright.

Posted by LA777 > 2017-06-17 10:21 | Report Abuse

Thanks for sharing!

Posted by Stock Kingdom > 2017-06-17 10:36 | Report Abuse

The options are all subject to the management's decision, we can only guess, hmmm....

Posted by Stock Kingdom > 2017-06-17 10:37 | Report Abuse

Good one, LA777

Posted by Stock Kingdom > 2017-06-17 10:39 | Report Abuse

Logical thinking is:

chance of going down = slim
chance of going up = good

At least it won't make you broke :)

Posted by Albukhary > 2017-06-18 10:42 | Report Abuse

Before Sunway Medical listed, we all should focus on TDM first.
Included the new hospital at Terengganu, TDM should have total 427 bed.
For a size of 427 bed, its market value should be at least RM400-RM500mil.

Many people are concern about TDM's PBT on its healthcare unit, because it is relatively low compare to other player. However, if you have monitor their corporate development for the past 3 years, you will know know TDM is expanding and upgrading its hospital (i.e. Taman Desa, Kelana Jaya, Terengganu). All these expansion and upgrading expenses has caused their PBT drop for the past 2 years.

However, all these will be ending soon, the Taman Desa medical centre has completed its expansion, from 27 beds to 80 beds, and the Kelana Jaya Medical also increase to 50 beds, plus the new Terengganu Hospital with 130 beds.

With the additional beds, I'm expected revenue will increase 15%-20%, while PBT will be increase to at least RM5mil per quarter.

Based on Rm5mil per quarter, 1 year is RM20mil. If we applied PE of 25 times, then its healthcare unit will be worth RM500mil.

If profit can increase to RM7 mil per quarter (which is very possible for the size of 427 beds), then 1 year will be RM28mil, times 25 PE, it will be worth RM700mil.