The Star Online: Business
The Star Online: Business |
- Astro opens at RM3.03
- China Q3 growth of 7.4% misses official target for first time since 2009
- Bullish on London property
| Posted: 18 Oct 2012 07:30 PM PDT KUALA LUMPUR: Astro Malaysia Bhd made its debut on the Main Market on Friday at RM3.03, which was three sen above its offer price of RM3 per share. The IPO is the third largest public offering in Malaysia and Southeast Asia thus far this year. At RM3 per share, the pay TV operator's market capitalisation was RM15.6bil (US$5.1bil). The IPO comprised of 1.518 billion 10 sen shares, or 29.2% of the paid-up share capital. Of the 29.2%, Astro had said 20.1% were secondary shares offered by Astro Malaysia's shareholder, Astro Networks (Malaysia) Sdn Bhd, and about 9.1% were primary shares offered by the company. Astro said total amount of funds raised was about RM4.6bil (US$1.5bil), of which the amount raised by the company was RM1.4bil (US$500mil). Astro was delisted from the Malaysian stock exchange following a 2010 buyout by Malaysia's second richest man Ananda Krishnan and Khazanah Nasional, the investment arm of the Malaysian government. When the company was taken private it was valued at RM7.9bil (US$2.6bil). Affin Investment Bank Research said at the IPO price of RM3, Astro was valued at a price-to-earnings multiple of 32 times CY13 EPS and enterprise value/earnings before interest, taxation, depreciation and amortisation of 13 times. "This lies at the higher end of its regional peers valuation range. We are however of the view that its fundamentals and exclusivity may warrant such premium valuations. The research house said Astro had a 99% market share in the pay TV derived from its strong premium content and exclusive sole satellite pay TV operator status. "With these two key high barriers to entry, we expect Astro to retain its market leadership position. Management has guided for a minimum dividend payout ratio of not less than 75% (2.3% yield for FY13). "This will become more meaningful once earnings recover after Astro passes the current transitional blip, a result of Astro incurring major capex as it migrates its customers into the new B.yond set top boxes," said Affin Research. |
| China Q3 growth of 7.4% misses official target for first time since 2009 Posted: 18 Oct 2012 06:58 PM PDT BEIJING: China's economy slowed for a seventh straight quarter in July-September, missing the government's target for the first time since the depths of the global financial crisis. The National Bureau of Statistics said GDP grew 7.4% in the third quarter from a year earlier in line with forecasts from economists polled by Reuters, the first miss of the official target since 6.5% growth in the first quarter of 2009. "This is within expectations, the economy is showing signs of stabilising, that is good news," said Dong Tao, an economist at Credit Suisse in Hong Kong. "We think that with rebounding property markets, stabilising export orders, resuming consumption, we probably have seen the bottom of the economy. The economy can bounce back quickly." While GDP growth at 7.4% would be cause for joy in recession-stalked developed economies, it represents a sharp slowdown for China, where GDP grew 9.2% in 2011 and has averaged an annual rate near 10% for three decades. The government targets growth of 7.5% for the full year reduced in 2012 from the previous 8% target and the consensus forecast of economists polled by Reuters is that it will deliver on it, with an expansion of 7.7%. Indeed, Premier Wen Jiabao was quoted by local media as saying on Wednesday that the economic situation in the third quarter was relatively good, and the government was confident of achieving its goal. But the remorseless slowdown has confounded forecasters repeatedly this year, with the initial consensus call for growth to bottom in the first quarter being persistently beaten back to its present position of a trough in the third quarter followed by a mild uptick in the fourth quarter. Some analysts cite electricity usage growth running at roughly half the average rate of the last five years as a manifest sign of economic malaise. Others disagree. They say there is clear evidence that the financial system's liquidity taps have been opened wide and that finetuning policies Beijing's mantra for a year now are gaining traction. The fine tuning includes two interest rate cuts, three cuts to the proportion of deposits banks must keep as reserves freeing an estimated 1.2 trillion yuan (US$190bil) for lending and approvals in the last month for infrastructure projects worth about US$157bil. - Reuters |
| Posted: 18 Oct 2012 06:53 PM PDT PETALING JAYA: Kenanga Research analysts came away from a recent visit to Europe's financial city of London positive on the city's property scene as the residential segment of the market faces a tight supply while the commercial segment is also short of prime commercial properties. The Kenanga research team noted that London's property scene has ironically bucked the overall bearish trends in the United Kingdom. "The eurozone contagion and tighter UK lending environment have impacted overall UK prices, but has ironically been a big plus for London. "By mid-2012, we understand London's residential prices achieved a 6% year-on-year (yoy) growth and up to 12% in selected prime areas against the weaker UK national price increase of 0.9%," the team stated. They said in their report that a tough local lending environment there had given foreign developers an advantage because UK loans approvals had declined significantly and had surpassed its historical 15-year low. "Loan-to-value (LTV) has also eased-off significantly with average property deposits at more than 25% of property values in 2011. "The tighter lending environment and the global financial crisis have also affected local developers in terms of funding and ability to hold or acquire landbanks," the report stated. This is one of the main reasons Battersea Power Station, where a joint venture consortium consisting SP Setia, Sime Darby and Employees Provident Fund joint managed to secure the project at a price tag of £400mil (RM1.96bil) after the previous developer became a victim of the global financial crisis. Kenanga said that London city was also viewed as a safe haven destination in Europe or as an avenue to divest new found wealth more so especially from emerging markets such as China, India and Russia. "On this backdrop, the local scene in London is still tough as developers are finding it tough to raise financing for landbanking or to kick off new launches," it added. Meanwhile, they said the move by Malaysian developers to invest in the London property market had been largely driven by the need to divest their earnings base overseas. "The Malaysian property market can no longer offer larger listed developers, with high base sales, the double-digit sales growth required by shareholders. "We do expect to see more Malaysian developers and investment companies making a bee-line for London," it said. However, they noted that the development landscape in the UK, especially in central London, could be "challenging" in terms of approvals but public and local authorities perception of the project and infrastructure requirements such as transportation, and the shortage of both residential space, with the lack of Grade A commercial buildings are reasons that will overcome these challenges. Back home, Kenanga also has a "neutral" call on developers due to the tightening supply of real estate policies but has an "outperform" call on IJM Land, and a "market perform" call on both Sime Darby and SP Setia. |
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