Latest QR of 2.98 is a flash in the pan! If extrapolated , this means EPS of approx. 12 sen pa. Such an annual earning is impossible for this Co in its current set up, structure and capacity. Thus, PE valuation is misleading more so given the non accretive business it is in!
Current price is app 50 sen, which has partly factored in the 20 sen dividend, thus assuming ex div value of 50-2-=30 sen, and the multiples of 15 for this business, it derives EPS of 30/15 = 2, which in itself is a bloated earnings!
Doubt if any other sale of asset will bring in any additional value without sacrificing earnings quality! Those in the money should be careful and exit!
As shareholder, I m yet to receive the EGM notification and am sure many are in the same connundrum too!
If one values it on combo of NTA and disposal gain only - Current NTA is 77 sen. the sale will bring in RM185mil, ie gain of 31 sen, thus valuing it at RM1.08 cum dividend!
The only laggard here is, if the operations will be earnings dilutive!
As long as PEILKAN is profitable, such above level should stay!
I already called Pelikan Office and they confirmed that Egm will be on Nov 5 for voting of assets sale
As the assets disposal has shown a clear 100% profit since purchase we can also see other assets are similar
So by way of deduction we can also give a general rule that other assets should also increase by the same quantum of 100%
From here we can multiply Nav of 77 sen by 2 which is Rm1.54 (if revalued and updated to current value)
Taking Benjamin Graham required 30% discount to Nav the intrinsic value of Pelikan Rm1.54 x .7
= Rm1.07
Our target price of Rm1.00 is still below intrinsic value with 30% margin of safety
As for P/E with the Cash settlement of Rm200 million loans there will be a saving on bank interest of Rm8 millions per year which will show up in lower gearing and higher profits
The Extra 10 sen surplus could be used to generate more revenue and profits
If not for this generous unlocking of value by assets disposal and dividend payout of 20 sen we would not have given Pelikan a second look
By this very pro active move we see Pelikan is "doing something " positive
New IPO: The onshore and offshore support services provider for the O&G industry, Steel Hawk Bhd aims to list on the Ace Market!
MQ Trader 2943 views | 2 d ago
0:17
New IPO: The largest mini-market player and a leading groceries retailer in Malaysia, 99 Speed Mart Retail Holdings Bhd aims to list on the Main Market!
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....
calvintaneng
56,026 posts
Posted by calvintaneng > 2021-10-21 22:13 | Report Abuse
Peliken has Pelican as its logo
Hopefully time for it to fly
https://www.youtube.com/watch?v=KjsBkElRDSk