KUALA LUMPUR (Jan 30): Shares of Glenealy PLANTATION []s (Malaya ) Bhd and Lingui Developments Bhd advanced on Monday after Samling Strategic Corporation Sdn Bhd (SSC) said it plans to pursue a proposed privatisation of Samling Global (SGL), and in turn, SGL will also propose to privatise Lingui and Glenealy.
At 9.20am, Glenealy jumped 45 sen to RM7 with 66,000 shares traded, while Lingui added 16 sen to RM1.52 with 676,500 shares done.
SSC has indicated that it expects to propose an offer price of RM1.63/Lingui share and RM7.50/Glenealy share.
RHB Research in a note Monday said that at RM1.63 per share, and assuming the offer price of RM7.50/share for Glenealy, this effectively valued Lingui’s timber business at a PER of 9-10x based on our CY12 EPS forecast.
It said the valuation seemed fair, as this was slightly higher than its current target PER of 8x for the timber sector and comparable to its closest and more liquid peer, WTK, which was trading at a CY12 PER of 9.5x.
“The offer price for Glenealy is also fairly valued at a PER of 12.8x consensus CY2012 EPS, similar to our target PER of 13x for mid-sized plantation company.
“We believe a formal offer will be put forward once SSC finalises its funding agreement. Hence, we revise our call (for Lingui) to Trading Buy (from Underperform) with a new fair value of RM1.63 per share (from RM1.33), which represents the indicative offer price proposed by SSC,” it said.
At 9.20am, Glenealy jumped 45 sen to RM7 with 66,000 shares traded, while Lingui added 16 sen to RM1.52 with 676,500 shares done.
SSC has indicated that it expects to propose an offer price of RM1.63/Lingui share and RM7.50/Glenealy share.
RHB Research in a note Monday said that at RM1.63 per share, and assuming the offer price of RM7.50/share for Glenealy, this effectively valued Lingui’s timber business at a PER of 9-10x based on our CY12 EPS forecast.
It said the valuation seemed fair, as this was slightly higher than its current target PER of 8x for the timber sector and comparable to its closest and more liquid peer, WTK, which was trading at a CY12 PER of 9.5x.
“The offer price for Glenealy is also fairly valued at a PER of 12.8x consensus CY2012 EPS, similar to our target PER of 13x for mid-sized plantation company.
“We believe a formal offer will be put forward once SSC finalises its funding agreement. Hence, we revise our call (for Lingui) to Trading Buy (from Underperform) with a new fair value of RM1.63 per share (from RM1.33), which represents the indicative offer price proposed by SSC,” it said.
