If the final takeover price is 76 sen, the return is 6.3%. But there is a risk that the deal may not go through. But as the S&P has already signed and presumably down payment made, the risk that the deal may not go through is very small. Then there is this waiting time, from completion of the deal by the state government to GO and the completion of GO, meaning payment to the shareholder. That involves time value of money and hence there certainly must be a discount from 76 sen for KHSB's share price. Taking all these into consideration, the 6.3% discount of the share price to the takeover price of 76 sen is probably right. Unless of course if there is a revision of the takeover price to 83.5 sen. So what is the problem with you guys?
At this juncture, I will rate KHSB as one of the best risk adjusted return from KLSE. Why? The offer of takeover is at 76 sen. The S&P has been signed and down payment made (I think so, correct me if I am wrong). So the return of buying KHSB at 72 sen now will be 5.6%. Holders of KHSB shares just have to wait for the conclusion of takeover by the state government, and eventually the GO. Assuming this takes until end of September 2013, the annualized return will be 17%. You think you can be very sure to earn that kind of return from stocks in Bursa, in view of the volatility in the market now, without subjected to higher risk?
What if the offer price is adjusted to 83.5 sen? the annualized return would be 48%.
So holders of KHSB, do you seriously have anything to complain about? Of course if you are not a shareholder, you should have nothing to complain about.
congrat kc for your pintaras ... but that 17%? khsb fr 5.6% wow ...u have tripling it by 'assuming' until september...that's to much... think about it ..exaggerating things... however lucky u for your pintaras
the litigation is nothing new. it wont affect the price. the price fluctuate a little bit once in awhile is due to profit taking/exist from some of the impatient shareholders.
Theedge have an article on this in its latest weekly issue. Valuation to be done within 3 months from date of announcement (29 April), still have some time to go, be patient.
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....
johndow
166 posts
Posted by johndow > 2013-05-31 18:31 | Report Abuse
this counter full of drama .. not yet end .. hihi