KUALA LUMPUR: MSM Holdings Bhd made a strong debut on the Main Market of Bursa Malaysia on Tuesday, June 28 and topped the actives in early trade.
The stock jumped RM1.06 to RM4.56 at 9.15am with 33.86 million shares traded.
MSM's institutional price was fixed at RM3.50 and for retail investors at RM3.38 per share after the book-building exercise.
AmResearch has valued MSM at RM4.53 per share based on a price earnings ratio (PER) of 10 times financial year 2012 earnings per share. Its PER of 10 times is about 23% below the regional average PER of 13 times ex-Japan and Australia.
The research house said MSM was expected to be a high dividend-yielding stock. It added that the group's estimated FY11 to FY12 dividend yields of 6% to 7% (based on the IPO price of RM3.50) would be higher than most of the consumer and numbers forecast operator companies. It said MSM plans to pay out 50% of its net profit as dividends every year.
RHB Research Institute had accorded a fair value of RM4.90 to the shares. It said based on its analysis, MSM's regional peers are trading at an average PER of 11.6 times FY11 and 10.6 times FY12.
'As such, we attribute a target PER of 11 times FY12 to MSM's earnings, in between its regional peers' valuations for FY11 and FY12, and obtain a fair value of RM4.90. This implies a 40% upside from the IPO price of RM3.50/share. At our fair value of RM4.90, investors would also benefit from a dividend yield of 4%-5% per annum,' it said.
The stock jumped RM1.06 to RM4.56 at 9.15am with 33.86 million shares traded.
MSM's institutional price was fixed at RM3.50 and for retail investors at RM3.38 per share after the book-building exercise.
AmResearch has valued MSM at RM4.53 per share based on a price earnings ratio (PER) of 10 times financial year 2012 earnings per share. Its PER of 10 times is about 23% below the regional average PER of 13 times ex-Japan and Australia.
The research house said MSM was expected to be a high dividend-yielding stock. It added that the group's estimated FY11 to FY12 dividend yields of 6% to 7% (based on the IPO price of RM3.50) would be higher than most of the consumer and numbers forecast operator companies. It said MSM plans to pay out 50% of its net profit as dividends every year.
RHB Research Institute had accorded a fair value of RM4.90 to the shares. It said based on its analysis, MSM's regional peers are trading at an average PER of 11.6 times FY11 and 10.6 times FY12.
'As such, we attribute a target PER of 11 times FY12 to MSM's earnings, in between its regional peers' valuations for FY11 and FY12, and obtain a fair value of RM4.90. This implies a 40% upside from the IPO price of RM3.50/share. At our fair value of RM4.90, investors would also benefit from a dividend yield of 4%-5% per annum,' it said.
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