KUALA LUMPUR: There may be limited upside in sugar refiner MSM Malaysia Holdings Bhd's share price, which made a stunning debut on the Main Market of Bursa Malaysia, jumping 31% or 95 sen from the initial public offer price of RM3.50.
MSM Malaysia is an indirect subsidiary of the Federal Land Development Authority (Felda), a statutory body founded in 1956 to alleviate poverty among rural Malays via a land resettlement scheme.
The listing is a watershed in Felda's history as this is the first time the body is listing one of its businesses.
The share price ended the first day of trading with a RM1.39 gain at RM4.89 with 1.01 billion shares transacted.
Strong opening: (From left) Felda Global Group president Datuk Sabri Ahmad, Felda director-general Datuk Dzulkilfli Abd Wahab and Mohd Isa at the listing. The stock rose to an intra-day high of RM4.96 just 20 minutes before trading for the day ended.
An analyst covering the stock told StarBiz that the earnings potential for the financial year ending Dec 31, 2012 (FY12) had been priced in.
“I think it's now fairly valued especially since the consensus was for RM4.50 per share which entailed a price-to-earnings ratio of 10 times FY12 earnings per share,” he said.
He added that low raw-sugar prices would boost the company's margins where sales of refined sugar to beverage makers such as Fraser & Neave Holdings Bhd and CI Holdings Bhd were concerned.
“This is because sales of refined sugar to these companies whose products are for exports too are transacted at market prices,” he said.
MSM chairman Tan Sri Mohd Isa Abdul Samad, who is also Felda chairman, said following the company's listing ceremony yesterday that Felda planned to add to its land bank.
Felda, which owns one of the world's largest diversified agriculture groups, has an existing land bank of 853,000ha within the country with an additional 140,000ha outside Malaysia.
“We're in the final stages of negotiation with a counterpart in Myanmar to acquire land and also doing a feasibility study to buy land in Cambodia.
“We hope to conclude the acquisitions this year,” Mohd Isa said, adding that the land in Myanmar covered about 20,000ha.
He said there were no merger and acquisition plans for now. “We'll manage the company to the best we can and give back value to our shareholders,” Mohd Isa said.
He said the plans to list other businesses under the Felda stable would be up to Prime Minister Datuk Seri Najib Tun Razak, who would announce any such moves.
Felda has interests in more than 80 subsidiaries, associate companies and joint ventures which engage in agro-based activities including multi-crop plantations, oil and fats, oleo chemicals and logistics across 12 countries.
http://biz.thestar.com.my
No comments:
Post a Comment