Saturday, March 28, 2015
Tower Reit (TWRREIT) recently announced that it was disposing off 19 office parcels and 190 car park bays within Menara ING in Jalan Raja Chulan for RM132.34 million cash, which will result in a gain of RM40.4 million for the trust. Well, the proposed disposal has been completed as announced on 26 March 2015.
With net asset value backing of about RM1.91 per share, I wonder how long the share price can remain undervalued at the current price of RM1.29. The discount of 62 sen or 32% to its net asset value is just too large for a dividend-paying REIT, in my opinion.
What options or developments can arise from the deployment of the sale proceeds of around RM132 million? Whether the funds are used to repay bank borrowings in full or be used to purchase new yield-accretive properties, the dividend payout should increase accordingly.
I continue to think that holding Tower REIT shares in my portfolio is a good idea. The waiting will be worth it, I reckon.
Posted by Stephen at 12:54 AM
Tuesday, March 10, 2015
YTL E-SOLUTIONS BERHAD's shares has been rather active these past 2 days with an upward bias.
I was attracted by its high dividend yield as well as its attractive business model. In the past, there were speculation of it being a privatisation candidate, going the way of YTL Cement. Who knows?
This is an extract from Insider Asia's article on 6 March 2015:
"For FYJune2014, the Communications Technology segment, which owns the WiMax spectrum, contributed RM75.1 million or 86.5% of YTLE’s total revenue and the bulk of earnings. The remaining 5.9% and 7.6% of sales were from the Content & Digital Media and Information Technology & E-commerce, respectively.
The spectrum sharing business is expected to remain the main earnings contributor for the foreseeable future. Under the agreement with YTL Communications, the company will receive a minimum RM75 million annually or 15% of the WiMAX services revenue, whichever is higher.
Thanks to the spectrum sharing agreement, YTLE’s turnover has been steady, ranging from RM74- 88 million between FY11 and FY14 while net profit hovered around RM30-36 million over the same period. Net margin was roughly 41%, on average.
Dividends were raised to 4 sen per share in FY14, up from 2 sen in FY11-FY13. We believe this new level is sustainable, at least, supported by steady cashflow and strong balance sheet. This translates into a higher-than-market average net yield of 7.48%. "...read more
Posted by Stephen at 1:01 AM