KUALA LUMPUR (Feb 8): OSK Research is maintaining a Buy on Perwaya Holdings Bhd with a fair value of RM1.65.
It said on Wednesday it remains upbeat on Perwaja despite the latest rating downgrade by Malaysian Rating Corporation Bhd.
“We believe equity investors should instead keep a close eye on the ongoing transformation efforts implemented by the management,” it said.
OSK Research said the efforts undertaken were: (i) the commissioning of the pelletization and concentration plant in 2012 is likely to translate into significant cost saving of up to USD50 a tonne for its upstream material, and (ii) the award of the mining concession in Bukit Besi, Terengganu may also translate into a blue-sky DCF valuation of RM2.65 per share.
“That aside, we also like the company’s impending corporate proposal to raise cash via the issuance of RCULS as they come with free detachable warrants on the basis of 1-for-2, which is set to reward minority shareholders. Having said that, we decide to keep our BUY recommendation on Perwaja with its Fair Value maintained at RM1.65,” it said.
It said on Wednesday it remains upbeat on Perwaja despite the latest rating downgrade by Malaysian Rating Corporation Bhd.
“We believe equity investors should instead keep a close eye on the ongoing transformation efforts implemented by the management,” it said.
OSK Research said the efforts undertaken were: (i) the commissioning of the pelletization and concentration plant in 2012 is likely to translate into significant cost saving of up to USD50 a tonne for its upstream material, and (ii) the award of the mining concession in Bukit Besi, Terengganu may also translate into a blue-sky DCF valuation of RM2.65 per share.
“That aside, we also like the company’s impending corporate proposal to raise cash via the issuance of RCULS as they come with free detachable warrants on the basis of 1-for-2, which is set to reward minority shareholders. Having said that, we decide to keep our BUY recommendation on Perwaja with its Fair Value maintained at RM1.65,” it said.
