hi mimi898, to be frank to you, there have some advantages and disadvantages for bonus issue.
Advantage would be:- - There have be attract lots of contra players and big players come along to fry the price. - your share unit will be increased 50% but share price will dropped due to you need to multiple 2 and divided into 3.
Disadvantage would be:- - Lots of contra players normally will throw before the expired date due to they are trying to take profit. - share price will drop, due some of players will throw after entitlement, as they are trying to get warrant. - The profit need to divided more due to number of share increased, if the coming quarter report having the same profit amount with the previous quarter, then the EPS would drop, people will throw for sure.
Let's us take today share price 0.455 (PE 15) to calculate the price after bonus.. 0.455 x 2 / 3 = 0.305
For the share price view, the latest EPS is 0.96 and their managements have promise that the following report will be nice as well. so we just roughly take 0.96 to assume the following 3 quarters is same result. But due to share already included 50%, so we can calculate EPS 0.96 x 2 / 3:-
0.64 x 4 = 2.56 PE 10 for 2.56 = 0.255 PE 12 for 2.56 = 0.305 PE 14 for 2.56 = 0.355 PE 15 for 2.56 = 0.385
If you believe this company can do very well, it is worth to hold. They have new orders which are worth around 30m+ order books ahead, so their next quarter EPS will increased.. And they target to move to main market on beginning 2017.. their managements is doing good to seek improvement. I have confidence on them... :)
if PE15, price now should be RM0.61 ? 0.45 seems still worth to buy for future as even dilute the current cost still around 0.50+- ? correct me if wrong. Thank you...
On behalf of the Board of SEHB, M&A Securities Sdn Bhd wishes to announce that the Board has on 13 June 2016 resolved to fix the exercise price for the Warrants to be issued pursuant to the Bonus Issue of Shares with Warrants at RM0.20 per Warrant (“Exercise Price”).
On behalf of the Board of SEHB, M&A Securities Sdn Bhd wishes to announce that the Board has on 13 June 2016 resolved to fix the exercise price for the Warrants to be issued pursuant to the Bonus Issue of Shares with Warrants at RM0.20 per Warrant (“Exercise Price”).
The aforementioned Exercise Price represents a discount of approximately 33.8% to the theoretical ex-bonus price of SEHB Shares of approximately RM0.3022 and a discount of 27.7% to the theoretical ex-all price of SEHB Shares of RM0.2767, based on the 5D-VWAP of SEHB Shares up to and including 10 June 2016 of approximately RM0.4533 per Share.
The exercise price for the Warrants was determined by the Board after taking into consideration, amongst others, the following:
(i) The 5D-VWAP of SEHB Shares from 6 June 2016 to 10 June 2016 of approximately RM0.4533;
(ii) Prevailing market conditions;
(iii) Trading and liquidity of SEHB Shares;
(iv) Theoretical ex-bonus and ex-all prices of SEHB Shares of approximately RM0.3022 and RM0.2767, respectively;
(v) The par value of SEHB Shares of RM0.10 each; and
(vi) That the Bonus Shares and Warrants will be issued at no cost to the Entitled Shareholders.
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....
Myeye
1,373 posts
Posted by Myeye > 2016-06-15 09:52 | Report Abuse
on the basis of one (1) Bonus Share together with one (1) Warrant for every two (2) existing SEHB Shares. Good bargain.