As at 31 December 2013, the group has net assets of RM544 mil, interest bearing debts of RM295 mil and cash of RM132 mil.
To be conservative, let's assume that all the cash will be used to fund the group's future landbanking and / or property development activitues. As such, the gearing is 0.54 times.
However, out of the RM295 mil debts, RM130 mil is due in 5 years time (Islamic Medium Term Notes). As such, over the next few years, the group only needs to service principal repayment of RM165 mil, or average of RM33 mil per annum.
This amount is relatively small if compared to the group's net assets of RM544 mil and revenue of more than RM400 mil in the latest financial period.
In other words, the group has a relatively healthy balance sheet and shouldn't have problems servicing its financial obligations.
As shown in the table above, the group has more than 900 acres of land bank at strategic locations (mostly Klang Valley and Penang) with net book value of RM458 mil.
One of the most interesting piece is the 419 acres located at Sungai Long near Kajang, which has GDV of RM6 billion and could last the group for 10 years.
Many of these land bank were acquired / revalued many years ago. As such, the actual valuation should be substantially higher.
(a) Symlife is trading at substantial discount to net assets. Based on its net assets per share of RM1.93, PBR is 0.60 times only.
The net assets per share of RM1.93 has not factored in hundreds of million Ringgit of potential revaluation surplus.
In my opinion, revaluation surplus is more than just paper gain. Landbank that has not been revalued would automatically lead to fat profit margin when the properties are launched and developed.
This augurs well for the group's profitability going forward.
(b) The group has healthy balance sheet. The bulk of its debts are due in five years time. The group would have ample financial flexibility for expansion and to cope with any contingencies.
(c) The group's huge 419 acres of development land at Sungai Long is one of its key attraction. Bandar Sungai Long, located in Kajang, used to be considered a remote area. But with the completion of various highways, it is now only approximately 40 minutes travelling distance from KL. As such, in recent years, the area has attracted attention from housebuyers and property investors.
The group has settled the conversion premium and extension of lease for the land. It is estimated that the Sungai Long project will have GDV of RM6 billion and will take easily 10 years to complete.
(d) The stock is now trading at undemanding historical PE multiples of 7 times. This is expected to drop further as future development profit are gradually booked in.
Due to its low profile, the stock is relatively unknown to investors. However, it would be a matter of time before it starts gaining recognition, just like Gadang and GOB.
Symlife is interesting because it has small market cap and yet sits on huge tracts of land bank. Most of which are not revalued and reflecting market pricing at 1990s and early 2000s. The group used to be mired in debts. But with new owner and management, the group is finally truning around and heading towards the right direction.
An interesting small cap stock packed with potentials.
so buy at your own risk. I still hold 2200lot (x100) of symlife-wb. don't said i bring you to holland or want to release my share to you... look at gadang and sbccorp..initial spike also still have few days to play than minor correction..SBCCORP believe still will up because the sell down volume is less..so after T+4 on last friday, may go up again on Monday
by June 2014 can reach 2000.dragon lim, wb today touch 0.55,so 60 ~70 shouldn't no problem if mother go until rm1.50. this is only thinking only (take your own risk).
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Posted by siam8888 > 2014-04-19 11:57 | Report Abuse
Good luck to all, this is my last recommendation analysis counter given! Wish you all make money! Happy investing!!